If you’re considering starting a 501(c)(3) organization, and your organization is eligible to file Form 1023-EZ, there’s good news for you. Beginning July 1, 2016, IRS has reduced the 1023-EZ user fee to $275–down from $400.
This, of course, is great for anyone planning to file the 1023-EZ. That said, I’ve argued that the 1023-EZ process would improve with a little more oversight, and a lower user fee suggests that maybe that sort of change isn’t going to happen.
So, how do you know if your organization is eligible to file Form 1023-EZ? The Instructions for Form 1023-EZ include an eligibility checklist. The financial eligibility requirements to file Form 1023-EZ are:
- The organization does not expect annual gross receipts of more than $50,000 in any of the next 3 years;
- The organization has not had annual gross receipts of more than $50,000 in any of the past 3 years; and
- The organization does not have total assets exceeding $250,000.
There are 26 items total on the eligibility checklist, so you’ll want to review the whole thing. If the IRS finds that your organization is ineligible to file 1023-EZ, it will reject your application and you’ll have to file a full 1023, so make sure you’re eligible prior to submission.