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Apply For Tax-Exempt Status

Seeking tax-exempt status from the IRS can be an incredible amount of frustrating work, especially if you are not familiar with all the technical language the IRS uses on the application forms. Failure to properly answer questions, or the use of "red flag" terms in your responses to certain questions can result in lengthy delays and additional invasive questions from the IRS.

Your job when filling out Form 1023 or Form 1024 is to convince thke IRS that the organization qualifies for tax-exempt status under the category you have chosen.

I can serve in an advisory role, giving you help when you need it and reviewing your application before mailing, or I can prepare the entire application for you. I can offer something for just about every realistic budget.

Obtaining recognition of tax-exempt status is one of the most important acts performed by a new nonprofit organization. It is a time-consuming process and should not be left until the last minute.

It is most worthwhile to dedicate enough time and resources to properly prepare the application for tax-exempt status. It's easier and less expensive to do it correctly up front than it is to correct errors later. If you are working with a professional preparer, good communication is extremely important.

One of the advantages to working with an experienced professional like myself is that I can help you organize and refine your finances, your program focus, and your operations. My goal is to provide enough detail to the IRS to decide in your favor without the IRS sending additional requests for clarifying information.

During the preparation process I ask a lot of questions, I listen to everything you have to say, and I guide you along in the process. Each organization is unique.

How Much Should You Expect to Pay?

You should be aware that there are cut-rate shops that prepare exemption applications for a very low price. Be careful in dealing with those places. They use a cookie-cutter approach which may not accurately represent your organization's purposes and activities. Often they have hidden add-on fees. It is impossible to properly prepare an application for tax-exempt status for $500. On the other hand, it should not cost $10,000 for a small tax-exempt organization to get incorporated and file for tax-exempt status. Depending on the type and complexity of the organization, and the degree of cooperation you provide, expect to pay anywhere from $1,500 to $5,000.

How Long Does it Take to Prepare the Application?

Generally it takes about two weeks to prepare the application under the best of circumstances. In most cases I can prepare the application just about as fast as you can provide me with the information I request. More complicated organizations may require some additional time for research and documentation.

How Long Does it Take for the IRS to Review and Approve the Application?

It depends. The most straight-forward applications can be approved in about 8 weeks. More complicated applications can take six months to a year. Applications with controversial activities could drag on for more than a year.