Dear Pastor and Church,
We are proud to offer the most Complete and Authoritative 501(c)(3) Tax-Exempt services for Churches in The United States.
Does a Church have to contact the Internal Revenue Service in order to be Exempt from Income Taxation?
No. Churches are not required to apply for and obtain recognition of tax-exempt status from the IRS in order to be treated as tax exempt provided they meet the requirements of section 501(c)(3).
Is there any reason why a Church would contact the IRS for formal recognition of the Church as Tax Exempt?
Yes. Although there is no requirement to do so, many churches seek recognition of exempt status from the IRS because such regonition provides certain benefits. An Organization may find it useful to establish to the IRS that it is a Church so that the leaders of that church, as well as its parishioners and contributors, are certain that the Church is eligible for exemption and the many tax-prefered provisions that Congress has created for such organizations. For example, establishing its exempt status under 501(c)(3) provides the contributors of the church with advance assurance that their contributions are tax deductable. In order to receive this recognition and advance assurance, the organization must submit a Form 1023, Application for Recognition of Exemption, to the IRS and pay the applicable user fee. (User fees are discussed in greater detail below)
Source: Department of the Treasury, Publication 1828 Tax Guide for Churches and other Religious Organizations
Do not make the mistake and assume that because you form a corporation and are meeting regularly to worship that you are a 501(c)(3) tax-exempt organization within the meaning of 170(b)(1)(a)(i).
In American Guidance Foundation, Inc. vs. U.S., the court noted that the Internal Revenue Service has developed fourteen criteria which it applies as the circumstance warrant in order to determine if an organization is a “Church.”
Why put your church into jeopardy? Let us establish for you and receive your 501(c)(3) recognition from the IRS.
This is crucial for the prosperity of the church!
In determining whether an admittedly religious organization is also a church, the IRS does not accept any and every assertion that such an organization is a church. Because beliefs and practices vary so widely, there is no single definition of the word “Church” for tax purposes. The IRS considers the facts and circumstances of each organization applying for church status.
We will establish a “church status” for you and will also provide the following: (necessary for church status)
Church Charter & Bylaws
Brief history and the development of the church
Statement of faith
Statement of Church Ordination and Licensing
Formal code of doctrine and discipline for its members
Form of worship
Schedule of worship services (Church bulletin) also needed for sales tax exempt
Hierarchy or ecclesiastical government
Schedule of Officers and salary
Minister/pastor church work and salary
Minister/pastor employment agreement
Names, addresses, and resumes of Board Members (Trustees/Directors)
WARNING! Unless you and your accountant or lawyer are preparing 501(c)(3) applications on a daily basis, I would think twice before engaging any one to do this. (Ask for references) If done improperly you can delay the process up to 9 months, obtain an adverse determination letter and even lose your user fee. We receive many attempted applications with adverse “90 day” determination letters from lawyers, accountants and amateur people. They cry HELP!
Don’t let this be you.
Below, we have provided a brief summary of the IRS 501(c)(3) application process.
501(c)(3) Tax Exempt Status
The only way to establish a bonified tax exempt recognition with the IRS and the community is to apply for and must be granted the exempt status under the section 501(c)(3) of the IRS code. However, the IRS establishes a number of overriding restrictions and limitations that apply to your Church. Meeting these rules is critical to qualifying for and maintaining your non-profit tax-exempt status. These laws are complex.
We will prepare the 501(c)(3) tax-exempt application and all schedules, affidavits, forms, detailedfinancial statements, (revenue and expenses and proposed budgets for 2 years) and attachments for you and make sure that you will met all legal and technical requirements needed for the 501(c)(3) status.
For example, we will make sure you’ll meet the organizational test for exemption, which includes amending your Articles of Incorporation. Our Experience shows that 90 percent of the Articles of Incorporation we receive needs to be amended before submitting to IRS
We will also prepare all of your internal rules of operation. These rules are subordinate to the organization’s charter and make provisions for the qualification of its membership, their voting rights, election of its board of directors & officers, duties of board members and officers, terms of office, meetings, dues and assessments, if any.
We will be with you all the way until you get your 501(c)(3) and of course afterwards for compliance.
Upon receipt of the completed application and attachments the Internal Revenue Service will send you a Letter of Acknowledgment of your request and assign a document locator number. Technically they have up to 120 days to respond.
We will have you sign a limited power of attorney and Declaration of Representative Form 2848 this will enable us to correspond with the “Exempt Organization Specialist” that will be assigned to your case. Applications are handled and approved on a case by case basis.
This specialist will go over the entire application and attachments, in which it can take up to four months to finish the process. During this time we will correspond with the agent and make sure you meet all the technical and legal requirements. Because of our Excellent, thorough work and professional relationship with the IRS we have been receiving 501(c)(3) status for our clients on an average of 60 days!
According to the IRS not all organizations will receive a favorable determination letter. We will make sure you will receive your 501(c)(3) and will money back guarantee it.
What happens next?
After the technical review, which can take up to 4 months, you will receive a “determination letter” (this is your 501(c)(3) status) direct from the Director of Exempt Organizations. This letter will state that you are exempt from federal income taxes under section 501(c)(3). Churches receive Definitive Rulings under section 170(b)(1)(A)(i) Note! The IRS does not give 501(c)(3) identification numbers. This exemption will be retro active to the date of incorporation, which means any contributions you receive since you have been incorporated will be fully tax deductible.
Your letter is important as it shows to your grantors and contributors and the public that you are indeed a 501(c)(3) organization. The letter will also spell out restrictions and conditions that apply if you are to remain tax-exempt under sec. 501(c)(3). Moreover, the letter will address your Information and Annual Reporting Requirements to IRS.
INCLUDED AT NO EXTRA CHARGE!
YOUR STATE TAX EXEMPTION AND NON-PROFIT REGISTRATION
State Tax Exemption
If your State has Solicitation Registration Regulations, we will also register your organization with your State. All charitable organizations must register with the state prior to engaging in solicitation activities. (Please see your individual state requirement) and renew annually thereafter. We will register your organization with the State and inform you of this disclosure requirement.
Sales Tax Exemption
Exemption from State Sales Tax is granted only to non-profit organizations that meet the criteria set forth in State Sales Tax Section in your State Statutes. We will prepare your application for “Sales Tax Consumer’s Certificate of Exemption.”
Subject to the provisions of your State Immunity Statute: We will also include an indemnification agreement indemnifying all your directors and officers of the organization.
IRS Contributions Substantiation and Disclosure Requirements
Under the new law, section 170 and new section 6615 of the Internal Revenue Code, Churches will need to provide new kinds of information to donors. Thus, taxpayers may no longer rely solely on a canceled check for deductions. Failure to do so may result in denial of deductions to donors and the imposition of penalties on non-profits. To help comply with this law, we will provide you with IRS-compliant forms (as templates with your letterhead on top) to copy and to give out to your donors and contributors.
Internal Revenue Service (IRS) Application User Fee
We look forward to working with you to ensure that your organization is safeguarded through IRS exemption recognition and becomes an organization recognized by the IRS as exempt from federal (and state) income taxes, and eligible to receive tax deductible contributions from its donors and supporters, as well as Federal and State grants.
Please pray about it and if you have any more questions or requests regarding the above please don’t hesitate to give us a TOLL-FREE CALL @ 877-439-3678 .
Be anxious for nothing, but in everything by prayer and supplication, with thanksgiving, let your requests be known to God: …Phil 4:6