Taking Advantage of the Tax Exemptions there are for 501c3

Taking Advantage of the Tax Exemptions there are for 501c3 Organizations

It must feel like living in the movie Brazil to work for the IRS. What must it be like to be surrounded by forms with names like 1099, 1031 and 501c3 the whole time? Well, that's their way of life there everything that they know, do or ever want to do is defined by a section of the Internal Revenue Code. With that little philosophical aside aside, let's take a look at how you get a bit of tax exemption when you are a nonprofit especially what the IRS says about what they call 501c3 organizations.

501c3 organizations. What a way to refer to a nonprofit organization that works for religious, scientific, literary, educational or animal-rights causes. Nevertheless, you probably don't want to waste any time arguing with them about having your life's work reduced to a number. What you want instead is to understand the IRS code so that you can save a little money to use for what really matters.

Basically, if you want to seek some kind of tax exemption under this section, you'd better make sure that you look up section 501c3 of the IRS code and see if your kind of organization is covered. How do you know what kind of organization you have? You need a look at your Articles of Incorporation to see if you are exactly one of the different kinds of organizations they allow. You need to make sure of that, you need to make sure that whatever assets your organization owns, they are completely dedicated to those purposes in a way that they can never be put to use for anything else.

They like to split hairs with other rules too. You have to make sure for instance, that whatever kind of organization you're claiming to be, that your organization spends most of its time doing that kind of work. It won't do if you just do it 10% of the time, for instance. But let's say for instance that your organization's primary focus lies in something like animal-rights (that is allowed), but the way you involve yourself in that cause is all about lobbying Washington. Does that count as the right kind of activity for 501c3 organizations to take part in?

Not likely. They have a specific rule that says that you can't be lobbying the government (any government) for or against anything. Not if you want to qualify. You cany even openly support or oppose any political organization. If you can actually get by jumping through all these hoops, you have your tax exemption.

You have read the best review article categorized by free tips and the title Taking Advantage of the Tax Exemptions there are for 501c3. You can bookmark or spread this post by using this URL http://howto-howto8.blogspot.com/2011/09/taking-advantage-of-tax-exemptions.html. Thank You!