What does a nonprofit organization need in order to obtain a 501(c)(3) status?
In order for a nonprofit organization located in South Dakota to obtain 501(c)(3) status, it must first apply to the Internal Revenue Service (IRS). This process involves submitting an application, Form 1023 or Form 1023-EZ, and providing the IRS with information about the organization. The organization must indicate that its purpose is to benefit the public, rather than serve the interests of private individuals, and must provide statements that outline its activities. Additionally, the organization must provide documentation to demonstrate its tax-exempt status. This typically includes evidence that it is organized and operated exclusively for one or more types of exempt purposes. When applying, the organization must also provide details about its governance, operations, assets, and fund-raising activities. Finally, it must submit the proper filing fee to the IRS. After the organization submits the application and supporting documentation, the IRS will make a decision about its tax-exempt status. If approved, the organization will be notified and can start operating as a nonprofit. It may then begin receiving tax-deductible donations and advancing its mission.
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