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A tax exempt organization is able to avoid paying all or a part of its state and federal taxes. Although the process of preparing an organization for tax exempt status may be complex, the amount of money saved makes the effort worthwhile.
Becoming a Tax Exempt Organization
The most common types of tax exempt organization include:
Tax exempt organizations can become more successful at achieving their goals by re-investing the money they save on paying taxes into their respective goals.
Tax exemption status differs from state to state, but organizations hoping to achieve this status should begin the process by:
Becoming a Tax Exempt Organization
The most common types of tax exempt organization include:
- Non-Profit - Non-profit organizations include groups with "charitable," "religious," "scientific," "literary," or "educational" purposes.
- Others - Groups such as social clubs, business leagues, agricultural or horticultural organizations, social welfare organizations, veterans organizations, and employee benefits organizations.
Tax exempt organizations can become more successful at achieving their goals by re-investing the money they save on paying taxes into their respective goals.
Tax exemption status differs from state to state, but organizations hoping to achieve this status should begin the process by:
- Applying for federal exemption first - State tax exemption may depend on the IRS' decision concerning the status of your group. Even if you are denied federal tax exemption status, you may still qualify for state exemption.
- Seeking counsel - Organizations having trouble with the process of applying for tax exemption status should contact a tax exemption attorney or specialist.
