Outline
Navigating the complexities of tax-exempt status in the United States can be a daunting task for many organizations. At the heart of this journey is the IRS 1024 form, a critical document for those seeking recognition under various sections beyond the well-known 501(c)(3). This form allows associations, social clubs, and other non-profit entities to apply for tax-exempt status, offering a structured path to gaining financial and operational advantages. Completing the IRS 1024 form is a detailed process that requires an understanding of the specific entity type, eligibility requirements, and the precise nature of the organization's activities. The importance of this form cannot be overstated, as it acts as the foundational step towards achieving non-profit status, making it easier for organizations to pursue their missions without the burden of federal income tax. Equally, the IRS uses information from the form to assess whether an organization meets the strict criteria for tax exemption, ensuring that only those truly eligible receive this beneficial status. The preparation for and submission of the IRS 1024 can seem like a rigorous endeavor, but with careful attention to detail and a clear comprehension of the guidelines, organizations can navigate this process more smoothly, paving the way for a future focused on their mission rather than on tax liabilities.
Document Preview
The form you are looking for begins on the next page of this file. Before viewing it, please see the important update information below.
New Mailing Address
The mailing address for certain forms have change since the forms were last published. The new mailing address are shown below.
Mailing Address for Forms 1023, 1024,
Internal Revenue Service
TE/GE Stop 31A Team 105
P.O. Box 12192
Covington, KY
Deliveries by private delivery service (PDS) should be made to:
Internal Revenue Service
7940 Kentucky Drive
TE/GE Stop 31A Team 105
Florence, KY 41042
This update supplements these forms’ instructions. Filers should rely on this update for the change described, which will be incorporated into the next revision of the form’s instructions.
This page intentionally left blank.
Form 1024 (Rev. January 2018)
Department of the Treasury Internal Revenue Service
Application for Recognition of Exemption
Under Section 501(a)
Go to www.irs.gov/Form1024 for instructions and the latest information.
OMB No.
If exempt status is approved, this application will be open for public inspection.
Read the instructions for each Part carefully. A User Fee must be attached to this application.
If the required information and appropriate documents are not submitted along with Form 8718 (with payment of the
appropriate user fee), the application may be returned to the organization.
Complete the Procedural Checklist that follows the form.
Part I. Identification of Applicant Must be completed by all applicants; also complete appropriate schedule. Submit only the schedule that applies to your organization. Do not submit blank schedules.
Check the appropriate box below to indicate the section under which the organization is applying:
a
Section
b
Reserved for future use
c |
Section |
d
Section
e |
Section |
f |
Section |
g |
Section |
h |
Section |
i |
Section |
|
companies, or like organizations (Schedule G) |
j
Section
k |
Section |
||||
l |
Section |
||||
m |
Section |
||||
n |
Section |
|
|
||
|
|
|
|
||
1a |
Full name of organization (as shown in organizing document) |
2 Employer identification number (EIN) (if |
|||
|
|
|
|
|
none, see Specific Instructions) |
|
|
|
|
||
1b c/o Name (if applicable) |
|
|
3 Name and telephone number of person to be |
||
|
|
|
|
|
contacted if additional information is needed |
|
|
|
|
|
|
1c |
Address (number and street) |
|
Room/Suite |
|
|
|
|
|
|
|
|
1d |
City, town or post office, state, and ZIP + 4. If you have a foreign address, see Specific |
|
|
||
|
Instructions for Part I. |
|
|
|
|
|
|
|
|
( |
) |
1e |
Web site address |
4 Month the annual accounting period ends |
5 Date incorporated or formed |
||
|
|
|
|
|
|
6Did the organization previously apply for recognition of exemption under this Code section or under any other section of the Code? If “Yes,” attach an explanation.
Yes
No
7 Has the organization filed Federal income tax returns or exempt organization information returns? . . . . . . . .
If “Yes,” state the form numbers, years filed, and Internal Revenue office where filed.
Yes
No
8Check the box for the type of organization. ATTACH A CONFORMED COPY OF THE CORRESPONDING ORGANIZING DOCUMENTS TO THE APPLICATION BEFORE MAILING.
a |
Corporation— |
Attach a copy of the Articles of Incorporation (including amendments and restatements) showing approval by the |
|
|
appropriate state official; also attach a copy of the bylaws. |
b |
Trust— |
Attach a copy of the Trust Indenture or Agreement, including all appropriate signatures and dates. |
c |
Association— |
Attach a copy of the Articles of Association, Constitution, or other creating document, with a declaration (see instructions) |
|
|
or other evidence that the organization was formed by adoption of the document by more than one person. Also include a |
|
|
copy of the bylaws. |
If this is a corporation or an unincorporated association that has not yet adopted bylaws, check here . . . . . . . .
I declare under the penalties of perjury that I am authorized to sign this application on behalf of the above organization, and that I have examined this application, including the accompanying schedules and attachments, and to the best of my knowledge it is true, correct, and complete.
PLEASE |
F |
|
SIGN |
|
|
HERE |
(Signature) |
For Paperwork Reduction Act Notice, see instructions.
(Type or print name and title or authority of signer) |
(Date) |
Catalog No. 12343K |
Form 1024 (Rev. |
Form 1024 (Rev. |
Page 2 |
Part II. Activities and Operational Information (Must be completed by all applicants)
1Provide a detailed narrative description of all the activities of the
2List the organization’s present and future sources of financial support, beginning with the largest source first.
Form 1024 (Rev.
Form 1024 (Rev. |
Page 3 |
Part II. Activities and Operational Information (continued)
3Give the following information about the organization’s governing body:
a Names, addresses, and titles of officers, directors, trustees, etc.
bAnnual compensation
4If the organization is the outgrowth or continuation of any form of predecessor, state the name of each predecessor, the period during which it was in existence, and the reasons for its termination. Submit copies of all papers by which any transfer of assets was effected.
5If the applicant organization is now, or plans to be, connected in any way with any other organization, describe the other organization and explain the relationship (for example, financial support on a continuing basis; shared facilities or employees; same officers, directors, or trustees).
6If the organization has capital stock issued and outstanding, state: (1) class or classes of the stock; (2) number and par value of the shares;
(3) consideration for which they were issued; and (4) if any dividends have been paid or whether your organization’s creating instrument authorizes dividend payments on any class of capital stock.
7State the qualifications necessary for membership in the organization; the classes of membership (with the number of members in each class); and the voting rights and privileges received. If any group or class of persons is required to join, describe the requirement and explain the relationship between those members and members who join voluntarily. Submit copies of any membership solicitation material. Attach sample copies of all types of membership certificates issued.
8Explain how your organization’s assets will be distributed on dissolution.
Form 1024 (Rev.
Form 1024 (Rev. |
Page 4 |
Part II. Activities and Operational Information (continued)
9Has the organization made or does it plan to make any distribution of its property or surplus funds to shareholders or
members? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
If “Yes,” state the full details, including: (1) amounts or value; (2) source of funds or property distributed or to be distributed; and (3) basis of, and authority for, distribution or planned distribution.
Yes
No
10Does, or will, any part of your organization’s receipts represent payments for services performed or to be performed? . If “Yes,” state in detail the amount received and the character of the services performed or to be performed.
Yes
No
11Has the organization made, or does it plan to make, any payments to members or shareholders for services performed or
to be performed? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
If “Yes,” state in detail the amount paid, the character of the services, and to whom the payments have been, or will be, made.
Yes
No
12Does the organization have any arrangement to provide insurance for members, their dependents, or others (including
provisions for the payment of sick or death benefits, pensions, or annuities)? . . . . . . . . . . . . .
If “Yes,” describe and explain the arrangement’s eligibility rules and attach a sample copy of each plan document and each type of policy issued.
Yes
No
13Is the organization under the supervisory jurisdiction of any public regulatory body, such as a social welfare agency, etc.? If “Yes,” submit copies of all administrative opinions or court decisions regarding this supervision, as well as copies of applications or requests for the opinions or decisions.
Yes
No
14 Does the organization now lease or does it plan to lease any property? . . . . . . . . . . . . . . .
If “Yes,” explain in detail. Include the amount of rent, a description of the property, and any relationship between the applicant organization and the other party. Also, attach a copy of any rental or lease agreement. (If the organization is a party, as a lessor, to multiple leases of rental real property under similar lease agreements, please attach a single representative copy of the leases.)
Yes
No
15Has the organization spent or does it plan to spend any money attempting to influence the selection, nomination, election,
or appointment of any person to any federal, state, or local public office or to an office in a political organization? . . If “Yes,” explain in detail and list the amounts spent or to be spent in each case.
Yes
No
16 Does the organization publish pamphlets, brochures, newsletters, journals, or similar printed material? . . . . .
If “Yes,” attach a recent copy of each.
Yes
No
Form 1024 (Rev.
Form 1024 (Rev. |
Page 5 |
Part III. Financial Data (Must be completed by all applicants) |
|
Complete the financial statements for the current year and for each of the 3 years immediately before it. If in existence less than 4 years, complete the statements for each year in existence. If in existence less than 1 year, also provide proposed budgets for the 2 years following the current year.
A. Statement of Revenue and Expenses
|
Revenue |
1 |
Gross dues and assessments of members . . . |
2 |
Gross contributions, gifts, etc |
3Gross amounts derived from activities related to the organization’s exempt purpose (attach schedule)
(Include related cost of sales on line 9.) . . . .
4Gross amounts from unrelated business activities (attach schedule)
5 Gain from sale of assets, excluding inventory items
|
(attach schedule) |
. . . . . . . . . . |
6 |
Investment income (see instructions) |
|
7 |
Other revenue (attach schedule) |
|
8Total revenue (add lines 1 through 7) . . . . .
Expenses
9Expenses attributable to activities related to the organization’s exempt purposes . . . . . .
10Expenses attributable to unrelated business activities
11Contributions, gifts, grants, and similar amounts paid
(attach schedule) |
. . . . . . . . . . |
12Disbursements to or for the benefit of members (attach schedule)
13Compensation of officers, directors, and trustees (attach schedule)
14 |
Other salaries and wages |
|
15 |
Interest |
|
16 |
Occupancy |
|
17 |
Depreciation and depletion |
. . . . . . . |
18 |
Other expenses (attach schedule) |
|
19Total expenses (add lines 9 through 18) . . . .
20Excess of revenue over expenses (line 8 minus
line 19) . . . . . . . . . . . . .
(a) Current Tax Year |
3 Prior Tax Years or Proposed Budget for Next 2 Years |
|||
From |
|
|
|
|
|
|
(b) |
(c) |
(d) |
To |
||||
|
|
|
|
|
(e)Total
B. Balance Sheet (at the end of the period shown)
|
|
|
Current Tax Year |
|
|
|
Assets |
as of |
|
1 |
Cash |
1 |
|
|
2 |
Accounts receivable, net |
2 |
|
|
3 |
Inventories |
3 |
|
|
4 |
Bonds and notes receivable (attach schedule) |
4 |
|
|
5 |
Corporate stocks (attach schedule) |
5 |
|
|
6 |
Mortgage loans (attach schedule) |
6 |
|
|
7 |
Other investments (attach schedule) |
7 |
|
|
8 |
Depreciable and depletable assets (attach schedule) |
8 |
|
|
9 |
Land |
9 |
|
|
10 |
Other assets (attach schedule) |
. . . . . . . . . . . . . . . . . . . . . . . . . . |
10 |
|
11 |
Total assets |
11 |
|
|
12 |
|
Liabilities |
12 |
|
Accounts payable |
|
|||
13 |
Contributions, gifts, grants, etc., payable |
13 |
|
|
14 |
Mortgages and notes payable (attach schedule) |
14 |
|
|
15 |
Other liabilities (attach schedule) |
15 |
|
|
16 |
Total liabilities |
16 |
|
|
17 |
|
Fund Balances or Net Assets |
17 |
|
Total fund balances or net assets |
|
|||
18 |
Total liabilities and fund balances or net assets (add line 16 and line 17) |
18 |
|
|
If there has been any substantial change in any aspect of the organization’s financial activities since the end of the period shown above, check the box and attach a detailed explanation . . . . . . . . . . . . . . . . . . . . . . . . . .
Form 1024 (Rev.
Are you filing Form 1024 within 15 months from the end of the month in which the organization was created or formed as required by section 505(c)? . . . . . . . . . . . . . . . . . . . . . . . . . . . .
If “Yes,” skip the rest of this part.
If “No,” answer question 2.
2 If you answer “No” to question 1, are you filing Form 1024 within 27 months from the end of the month in which the organization was created or formed? . . . . . . . . . . . . . . . . . . . . . . . . . .
If “Yes,” your organization qualifies under Regulations section 301.9100-2 for an automatic 12-month extension of the 15-month filing requirement. Do not answer questions 3 and 4.
If “No,” answer question 3.
3 If you answer “No” to question 2, does the organization wish to request an extension of time to apply under the “reasonable action and good faith” and the “no prejudice to the interest of the government” requirements of Regulations section 301.9100-3? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 501(c)(9) and 501(c)(17) organizations:
1
Form 1024 (Rev. 1-2018)
Part IV. Notice Requirements (Sections 501(c)(9) and 501(c)(17) Organizations Only)
Page 6
Yes
No
Yes
No
Yes |
No |
If “Yes,” give the reasons for not filing this application within the
If “No,” answer question 4.
4If you answer “No” to question 3, your organization’s qualification as a section 501(c)(9) or 501(c)(17) organization can be recognized only from the date this application is filed. Therefore, does the organization want us to consider its application as a request for recognition of exemption as a section 501(c)(9) or 501(c)(17) organization from the date the application is received and not retroactively to the date the organization was created or formed? . . . . . . . . . . . .
Yes
No
Form 1024 (Rev.
Form 1024 (Rev. |
Page 7 |
Schedule A Organizations described in section 501(c)(2) or 501(c)(25)
1State the complete name, address, and EIN of each organization for which title to property is held and the number and type of the applicant organization’s stock held by each organization.
2If the annual excess of revenue over expenses has not been or will not be turned over to the organization for which title to property is held, state the purpose for which the excess is or will be retained by the title holding organization.
3In the case of a corporation described in section 501(c)(2), state the purpose of the organization for which title to property is held (as shown in its governing instrument) and the Code sections under which it is classified as exempt from tax. If the organization has received a determination or ruling letter recognizing it as exempt from taxation, please attach a copy of the letter.
4In the case of a corporation or trust described in section 501(c)(25), state the basis whereby each shareholder is described in section 501(c)(25)(C). For each organization described that has received a determination or ruling letter recognizing that organization as exempt from taxation, please attach a copy of the letter.
5With respect to the activities of the organization.
a Is any rent received attributable to personal property leased with real property? . . . . . . . . . . . .
If “Yes,” what percentage of the total rent, as reported on the financial statements in Part III, is attributable to personal property?
bWill the organization receive income which is incidentally derived from the holding of real property, such as income
from operation of a parking lot or from vending machines? . . . . . . . . . . . . . . . . . .
If “Yes,” what percentage of the organization’s gross income, as reported on the financial statements in Part III, is incidentally derived from the holding of real property?
cWill the organization receive income other than rent from real property or personal property leased with real property or income which is incidentally derived from the holding of real property? . . . . . . . . . . . . . .
If “Yes,” describe the source of the income.
Yes
Yes
Yes
No
No
No
Instructions
Line
Line
Line
describes the organization (as shown in its IRS determination letter).
Line
1.A qualified pension,
2.A government plan;
3.An organization described in section 501(c)(3); or
4.An organization described in section 501(c)(25).
Form 1024 (Rev.
Form 1024 (Rev. |
Page 8 |
This page left blank intentionally.
Document Attributes
| Fact Number | Detail |
|---|---|
| 1 | The IRS 1024 form is used by organizations seeking tax-exempt status under Sections 501(c)(4), (c)(5), (c)(6), and other sections of the Internal Revenue Code, excluding 501(c)(3). |
| 2 | Filing the IRS 1024 form is necessary to receive official recognition of tax-exempt status from the IRS, allowing qualifying organizations to be exempt from federal income tax. |
| 3 | The form requires detailed information about the organization's purposes, activities, governance, and financial data. |
| 4 | Applying organizations must pay a user fee upon submitting the IRS 1024 form, the amount of which is determined by the IRS and subject to change. |
| 5 | Completion and submission of the IRS Form 1024 can be done online through the IRS website, streamlining the application process. |
| 6 | After submitting Form 1024, organizations may have to wait several months to receive a determination letter from the IRS concerning their tax-exempt status. |
| 7 | Organizations that successfully obtain tax-exempt status through the IRS Form 1024 are not automatically exempt from state and local taxes, and may need to complete additional filings. |
| 8 | The IRS provides instructions and resources for completing the IRS Form 1024, including a comprehensive instructions document, to assist organizations in the application process. |
How to Fill Out IRS 1024
After deciding to apply for tax-exempt status, organizations typically need to complete and submit the IRS Form 1024. This form is crucial for those seeking recognition under sections other than 501(c)(3) of the Internal Revenue Code. Proper completion and submission of this document is a vital step in obtaining tax-exempt status. The process can be intricate, requiring detailed information about the organization's structure, activities, and finances. The steps outlined below guide through filling out the form accurately.
- Gather necessary information about your organization, including its legal name, Employer Identification Number (EIN), and mailing address.
- Determine the specific tax-exempt status your organization is seeking. The IRS Form 1024 includes sections for various classifications. Selecting the correct one is crucial.
- Complete Part I of the form. This includes basic information about your organization.
- Fill out Part II, where you provide the detailed narrative of your organization's activities. This section requires you to describe your organization's specific activities, how they further your exempt purpose, and the anticipated percentage of your time and resources devoted to each activity.
- Answer all questions in Part III related to your organization's structure and operational information, such as bylaws and articles of incorporation.
- In Part IV, disclose your organization's financial arrangements, including compensation to officers, directors, and trustees. This section also covers your sources of income and financial transactions with such individuals.
- If your organization falls under a specific tax-exempt category, complete the schedule that applies to your organization, which is located in the latter parts of the Form 1024.
- Review all the information provided in the form to ensure its accuracy and completeness. Errors or omissions can delay the processing of your application.
- Attach all required documents and schedules as specified in the instructions for Form 1024. This may include bylaws, articles of incorporation, financial statements, and a detailed description of your activities.
- Sign and date the certification at the end of the form. This step is crucial as it verifies the accuracy of the information provided.
- Prepare the payment for the application fee, which is required for the processing of Form 1024. The fee amount can be found in the instructions for the form.
- Mail the completed Form 1024, along with the necessary attachments and payment for the application fee, to the address specified in the form's instructions.
Once the IRS receives your Form 1024, they will review your application for tax-exempt status. This process may include requests for additional information or clarification on the details provided in your submission. Successfully navigating through this application process is a significant step for an organization in achieving its goals and operating effectively under its tax-exempt status.
More About IRS 1024
The IRS Form 1024 is a document submitted by organizations seeking tax-exempt status under sections other than 501(c)(3) of the Internal Revenue Code. This form helps the IRS determine whether an organization meets the criteria for exemption. Let's explore some common questions regarding this form.
- What is IRS Form 1024?
IRS Form 1024 is an application used by organizations to apply for recognition of exemption under sections of the Internal Revenue Code other than 501(c)(3). Organizations, such as those operating for social welfare, labor, agricultural, or business league purposes, might file this form to receive federal tax exemptions.
- Who needs to file IRS Form 1024?
Organizations seeking tax-exempt status under sections 501(a) but not qualifying under the 501(c)(3) section, such as 501(c)(4) social welfare organizations, 501(c)(6) business leagues, or 501(c)(7) social clubs, need to file Form 1024. It is important for an organization to review the specific requirements of the section under which it is seeking exemption to determine eligibility before filing.
- Is filing Form 1024 mandatory?
Filing Form 1024 is not mandatory for all organizations seeking tax-exempt status. Some entities, like churches or certain types of organizations that automatically qualify for a tax-exempt status, might not be required to file. However, filing can be beneficial as it officially recognizes the organization's tax-exempt status by the IRS, which can be helpful in fundraising and grant applications.
- What information is needed to complete Form 1024?
To complete Form 1024, organizations are required to provide detailed information about their structure, governance, finances, and operations. This includes the organization's name, address, statement of receipts and disbursements, articles of incorporation, bylaws, narratives of activities, and evidence of compliance with applicable laws. Accurate and comprehensive information supports the IRS in making a determination regarding tax-exempt status.
- How long does it take the IRS to process Form 1024?
The processing time for Form 1024 can vary greatly depending on the IRS's workload, the complexity of the application, and whether additional information is needed from the organization. Generally, it can take anywhere from a few months to over a year. Organizations can expedite the process by ensuring their application is complete and accurately filled out before submission.
- What is the difference between Form 1024 and Form 1023?
The primary difference between Form 1024 and Form 1023 lies in the type of organizations that each serves. Form 1023 is specifically for organizations seeking tax-exempt status under section 501(c)(3), which typically includes charities, educational institutions, and religious organizations. In contrast, Form 1024 is for organizations seeking tax exemption under other sections, as mentioned earlier. Each form requires information relevant to determining qualification under its respective code section.
- Can the Form 1024 application be filed electronically?
Yes, as of recent tax years, the IRS allows Form 1024 to be filed electronically through its website. Electronic filing is encouraged as it can be more efficient and may expedite the processing time. However, organizations have the option to file a paper application if they prefer. Detailed instructions on how to file electronically can be found on the IRS’s official website.
- Is there a filing fee for Form 1024?
Yes, there is a filing fee for Form 1024, which must be paid upon submission of the form. The fee amount can vary, so it is important for organizations to check the latest IRS guidance for the most current fee structure. Reduced fees may be available for smaller organizations, so reviewing the IRS's instructions closely is advisable.
- What happens after Form 1024 is filed?
After Form 1024 is filed, the IRS will review the application to determine whether the organization meets the criteria for tax-exempt status under the requested section. The IRS may contact the organization for more information or clarification during this process. Upon conclusion of the review, the IRS will issue a determination letter announcing its decision. If approved, the organization will be recognized as tax-exempt under the applicable section and subject to specific reporting requirements.
Common mistakes
When applying for tax-exempt status using the IRS Form 1024, applicants often encounter several common mistakes. It's important to carefully review the form and instructions to ensure accurate completion and submission. Mistakes in the process can lead to delays or the rejection of an application, affecting the organization's ability to operate efficiently. Below are some of the errors frequently made:
Not providing sufficient detail in the statement of activities. It's vital to clearly outline the organization's operations and purpose, ensuring the IRS understands its eligibility for tax-exempt status.
Failing to include all necessary schedules and attachments. Depending on the type of organization, additional information may be required.
Incorrectly classifying the type of organization. An error in identifying whether it's a 501(c)(3), 501(c)(4), etc., can impact the applicable rules and eligibility.
Omitting necessary financial data or providing incomplete financial statements. Accurate financial information is critical for demonstrating the organization's compliance and usage of funds.
Using an outdated version of the form. The IRS periodically updates their forms, so it's essential to use the latest version available on the IRS website.
Forgetting to sign and date the form. An unsigned form is considered incomplete and will not be processed.
Sending the form to the wrong address. The IRS has specific filing locations depending on the type of application and the organization's location.
Miscalculating the user fee and including an incorrect amount. The fee varies by organization type and gross receipts, so it's necessary to verify the correct amount due.
By avoiding these errors and thoughtfully preparing the IRS Form 1024, organizations can foster a smoother application process for tax-exempt status.
Documents used along the form
Applying for tax-exempt status in the United States requires thorough documentation to ensure compliance with IRS regulations. The IRS Form 1024 is one such document used by organizations seeking recognition of exemption from federal income tax under sections other than 501(c)(3). However, completing the Form 1024 is just a part of the compliance process. Organizations often need to complete and submit additional forms and documents to support their application. Below is a list of documents typically associated with the IRS Form 1024 application process.
- IRS Form 2848, Power of Attorney and Declaration of Representative: This form allows an authorized individual or organization, like an attorney or accountant, to represent the applicant in dealings with the IRS.
- IRS Form 8821, Tax Information Authorization: This document permits the IRS to disclose the applicant’s tax information to a third party, designated by the applicant.
- Articles of Incorporation: These are filed with the Secretary of State or an equivalent state agency to legally document the creation of the corporation. They must specify the purpose of the corporation, which should align with IRS requirements for tax-exempt status.
- Bylaws of the Organization: Bylaws govern how the organization operates, including the roles of directors and officers, the process for handling meetings, and other operational procedures. These are crucial for demonstrating the organized and operational status of the entity.
- Financial Statements: Recent financial statements provide a snapshot of the organization’s financial health and activities. These may include a balance sheet, income statement, and statements of functional expenses and cash flows.
These documents play a crucial role in supporting the IRS Form 1024 application. They help demonstrate the legitimacy, operational status, and purpose of an organization. Submitting a complete and accurate set of documentation is essential for a successful application process. Organizations should ensure they understand the requirements and seek assistance if needed, to navigate the complexities of tax-exempt status application successfully.
Similar forms
The IRS Form 1023 closely resembles the IRS 1024 form. Both are designed for organizations seeking tax-exempt status, but Form 1023 is specifically for 501(c)(3) organizations, which are primarily charitable. Both forms ask for detailed information about the organization's purpose, activities, and finances, ensuring compliance with federal tax exemption criteria.
IRS Form 990 shares similarities with the IRS 1024 form in that it is also related to tax-exempt organizations. Form 990 is an annual reporting return that federal tax-exempt organizations must file, providing information on their mission, programs, and finances. Both forms are crucial for maintaining transparency and compliance with IRS rules.
The IRS Form 8868 is akin to the IRS 1024 form in its association with tax exemption procedures, functioning as an application for an extension of time to file an exempt organization return. Organizations that need more time to prepare their Form 990 or 1024 can request an extension through Form 8868, highlighting the interconnected responsibilities of tax-exempt entities.
IRS Form 8940 also parallels the IRS 1024 form, as it is used by tax-exempt organizations to request specific rulings or determinations from the IRS. These requests can include changes to a classification, approval of scholarship programs, or exception from certain legal requirements. Similar to the IRS 1024, Form 8940 addresses various administrative processes needed for the ongoing compliance and operation of tax-exempt organizations.
Dos and Don'ts
Certainly! When filling out the IRS 1024 form, which is used by organizations seeking recognition of exemption from federal income tax other than those eligible to file Form 1023, it's important to follow certain practices for a smoother process. Below are key dos and don'ts:
Do:
Read the instructions provided by the IRS for the 1024 form thoroughly before starting. These instructions contain crucial information that can help avoid common errors.
Ensure your organization qualifies for the status you are applying for. Different sections of the form are applicable to different types of nonprofits, so understanding the criteria is essential.
Collect all necessary information and documents before starting the application. This includes your organization's EIN, organizing document (like articles of incorporation), and bylaws.
Use the most current version of the form. The IRS updates forms periodically, so using the latest version ensures compliance with current tax law.
Answer every question completely and accurately. If a question does not apply, indicate with "N/A" (not applicable) instead of leaving it blank.
Don't:
Attempt to fill out the form without first understanding the specific tax exemptions for which your organization is eligible. This can lead to applying under the wrong section and potentially having your application rejected.
Overlook the necessity of attaching all required schedules and attachments. The absence of these documents can delay the processing of your application or result in a denial.
Forget to have the form reviewed by someone familiar with IRS procedures and nonprofit tax laws, such as a legal advisor or an accountant, before submission. This can help catch any errors or omissions.
Submit the form without a signature. An unsigned form is considered incomplete and will not be processed by the IRS.
Ignore IRS correspondence after submitting the form. The IRS may request additional information or clarification, so responding promptly is key to advancing your application.
Misconceptions
Understanding the IRS Form 1024 and correcting common misconceptions can help organizations navigate the process of applying for tax-exempt status more smoothly. Here are four common misunderstandings:
- All nonprofit organizations must file Form 1024 to be tax-exempt. This is incorrect. While many organizations use Form 1024 to apply for exemption under sections 501(c)(4), (c)(6), and others, it's not mandatory for all. For instance, churches, their integrated auxiliaries, and conventions or associations of churches, as well as organizations that have gross receipts in each taxable year of normally not more than $5,000, are not required to file.
- Filing Form 1024 automatically grants tax-exempt status. Simply submitting Form 1024 does not guarantee exemption. The IRS reviews each submission carefully, ensuring the organization meets the specific requirements for tax exemption under the code section it is applying for. Approval is only granted after a thorough review of the application and supporting documents.
- Form 1024 is only for 501(c)(3) organizations. This is a common confusion. In reality, Form 1024 is used by organizations seeking tax-exempt status under various sections of 501(c), except 501(c)(3). Organizations seeking exemption under section 501(c)(3) must use Form 1023 or, if eligible, Form 1023-EZ.
- Once exempt, organizations never need to revisit Form 1024. Though the initial approval is a crucial step, maintaining compliance with federal tax laws is ongoing. Organizations should be aware of the need to file annual returns and inform the IRS of any significant changes to their organizational structure, purposes, or activities that might affect their tax-exempt status.
Key takeaways
If you're planning to fill out the IRS 1024 form, here are 10 key takeaways to guide you through the process:
- Understand that the IRS 1024 form is used by organizations seeking tax-exempt status under sections other than 501(c)(3) of the Internal Revenue Code.
- Before starting the form, make sure your organization is eligible by reviewing the specific requirements for tax-exempt status under the section you're applying for.
- Gather necessary information and documents about your organization, including its EIN (Employer Identification Number), bylaws, and financial statements.
- The form requires a detailed description of your organization’s activities, including past, present, and planned activities. Be clear and precise in your descriptions.
- There's a user fee associated with the IRS 1024 form. Check the latest fee schedule on the IRS website to ensure you’re sending the correct amount.
- Consider consulting with a tax professional or attorney experienced in tax-exempt law to help navigate the complexities of the application.
- File the form electronically through the IRS website or by mail, but electronic filing can lead to faster processing times.
- After submitting, expect to wait several months for the IRS to process your application. Processing times can vary based on the complexity of your application and the IRS’s current workload.
- Keep a copy of the completed form and all correspondence with the IRS for your records.
- Be prepared for the possibility of follow-up questions or requests for additional information from the IRS after you submit your form. Respond promptly to avoid delays in your application process.
Successfully applying for tax-exempt status using IRS form 1024 is a significant step for an organization. It can open up more opportunities for funding and grants, which are essential for organizations to thrive and serve their communities. Taking the time to carefully complete the form, following the requirements, and understanding the process is crucial for a positive outcome.
Other PDF Templates
Social Security Medicare - Must be used by anyone wanting to revoke their Medicare enrollment.
Check Food Stamp Status Phone Number Alabama - The form is an essential component of the child protective services framework within Alabama.
California Notice to Vacate - A carefully worded document that legally requires tenants to plan to vacate a property within 90 days, paying attention to procedure and property condition.