Answer: To be eligible for a 501 (C) (3) Non-Profit entity the organization must be organized as a trust, a corporation, or an association in order for it to meet IRS regulations. Some examples of exempt purposes that qualify are: charitable, religious, educational, scientific, literary and preventing cruelty to children or animals.
Question: Do all organizations require filing of exempt status?
Answer: If your organization has an exempt purpose, as listed above, you may not need to apply for federal tax exemption if the organization’s gross receipts are normally less than $5000 per tax year. You must also remember that if you apply for federal tax exempt status you must also do the same with your state and local governments. In Pennsylvania, at a minimum, you will need to complete Department of revenue forms for tax exempt status. You should always remember to seek the advice of a CPA when applying for tax exempt status and also your attorney for preparing the proper documents for filing with the state to form your entity.
This article appeared in a recent issue of Business Matters. For more articles related to Pittsburgh’s north hills you can subscribe here.