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	Overview How to Start a 501(c)3 Articles of Incorporation Sample Bylaws Using a Fiscal Sponsor Subscriber Log In

Starting a Nonprofit: Tax Exempt Process

What is the nonprofit organization 501(c)(3) tax exempt process?

Step1: Determine if you are ready to become a 501(c)(3) nonprofit organization

Review the Nonprofit Start-up Checklist
NOW AVAILABLE! Start Up for Success: A Step-by-Step Workbook for Planning, Founding and Initiating a New 501(c)(3) Nonprofit
The Workbook was developed to help meet the needs of individuals interested in starting a nonprofit organization—to help them weigh their options, start smart, and implement their early planning goals.

The workbook is designed to be an interactive guide that helps you solidify your thinking, ideas and actions around your specific concept. This is not a resource that will educate you on the depth and breadth of nonprofits, the history of nonprofits, or why nonprofits are important to our society. The information here is focused on guiding you through your own process, informed by what you need to know about nonprofits, the 501(c)(3) legal structure and the process of incorporation. Click here to purchase your copy.

Step 2: Incorporate your nonprofit organization in the State of Colorado/p>

Develop Articles of Incorporation for your organization
Register your nonprofit in the State of Colorado at the Secretary of State website and attach your Articles of Incorporation document saved in a pdf format. The cost to incorporate online is $50. (Additional amendments to the document also cost $25 a piece.)

NOTE: It is important that Articles of Incorporation be attached when you incorporate by checking “Yes” to the question “Do you wish to attach other statutorily required or optional information?” While not required for the State of Colorado, they are required at the Federal level to file for tax-exempt status.
Obtain a copy of your Certificate of Good Standing from the Secretary of State website.

Step 3: Apply for your Organization’s Employer Identification Number (EIN) with the Internal Revenue Service

You can obtain EIN online at the IRS website for free after completing a series of prompted questions.

NOTE: You may chose to view your EIN number immediately (recommended) or have it sent to your mailing address in 10-12 business days. If you chose to view the EIN number immediately, make sure you print several copies before clicking out of the screen. You will not have the opportunity to view this document again.

Step 4: Obtain and complete IRS Form 1023 (Application for Recognition of Exemption under Section 501(c)(3) of the Internal Revenue Code), Articles of Incorporation, Bylaws and necessary attachments with the Internal Revenue Service.

NOTE: We recommend trying to complete as much of the application as possible before reading the instructions and then using them as a reference for parts that are confusing.

1023 Application Form

While you can download the form in pdf format, you cannot submit the form (or attachments) to the IRS online. Therefore, we recommend saving the writable pdf to your desktop and working on it from there. You will need Adobe Acrobat in order to download the forms:

Step 5: File the Form 1023 (Application for Recognition of Exemption under Section 501(c)(3) of the Internal Revenue Code), Articles of Incorporation, Bylaws and necessary attachments with the Internal Revenue Service.

The application fee is either $350 or $750 depending on your estimated annual organizational budget size.
Upon receipt of the application, the IRS will mail you a letter outlining their process. After 30 to 40 days (or sometimes longer), you will receive a letter from the IRS asking for additional information.
If additional information is requested, respond as soon as possible. You are generally given 20 days to respond. If you do not respond within 20 days, your application can be denied. If you are not able to obtain answers to the questions within the 20-day period, call the IRS at the number given on the letter to work out arrangements. If any of the questions are unclear, you can also call this number for clarification from the IRS officer assigned to process your application.
Once the additional information is provided and the IRS is satisfied, you will receive a letter of designation granting your organization its 501(c)(3) status within as little as two months and as many as nine months.

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