IRS Releases Simplified Application for Small 501(c)(3)’s

On July 1, 2014, the IRS released Form 1023-EZ and related guidance for small eligible organizations to apply for tax exempt status recognition using the simplified 1023-EZ.  The streamlined application is available for most organizations with assets of $250,000 or less and annual gross receipts of $50,000 or less.  These tests are applied to prior years of operations as well as projections for future years.  Most small start-up nonprofit organizations should be eligible to utilize the new form, but the list of ineligible entities is lengthy and should be consulted.

The 1023-EZ must be submitted online, but a printed form of the 1023-EZ is a mere 3 pages compared to the 26 page regular Form 1023.  The application is a logical step for small nonprofits, which already are subject to similar relaxed annual reporting requirements with the Form 990-EZ.

For a link to the guidance, Rev. Proc. 2014-40, click here.  For a link to a hard copy of Form 1023-EZ, click here.  For a link to information on completing the form online through, click here.