Why Set Up a 501c3 Organization?

 

 Nonprofit organizations exist to serve the unmet needs of people, animals or the environment. Nonprofit organizations fall under section 501(c)(3) of the IRS tax code, qualifying them for income tax exemption under federal law.

 

One of the major benefits of being tax-exempt under IRC Section 501(c)(3) is the ability to accept contributions and donations that are tax-deductible to the donor. Additional benefits include, but are not limited to:

 

 

* Exemption from federal and/or state corporate income taxes
* Possible exemption from state sales and property taxes (varies by state)
* Ability to apply for grants and other public or private allocations available only to IRS-recognized, 501(c)(3) organizations
* Potentially higher thresholds before incurring federal and/or state unemployment tax liabilities
* The public legitimacy of IRS recognition
* Discounts on US Postal bulk-mail rates and other services

In summary, if you plan on applying for grants, you need to obtain 501c3 status.

If you plan on soliciting donations and contributions, you need to obtain 501c3 status.

Without having your 501c3 status:

* Your donors do not get a tax deduction and are thus less likely to make a contribution

* Many foundations will be legally prohibited from contributing to your organization

* Your organization’s legitimacy is questioned

 

To start your 501c3 today, just call Floyd Green CPA PC at 877-457-2550 or visit our website http://floydgreencpa.com/index.php/501c3/501c3-services for more info.