Discussion:Filing Tax Exempt Status
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Discussion Forum Index --> Tax Questions --> Filing Tax Exempt Status
| 16 July 2008 | |
| I have a client that has an organization that teaches soccer indoors or outdoors depending upon the time of year to children ages 10 to 18 and wants to file as a tax exempt organization. A 501(3)(c) can only be a school with a building and 501(7) is for a sports membership group. One form needs a 1023 and the other a 1024. I am having a difficult time advising this client on which way to go with the filing. | |
RoyDaleOne (talk|edits) said: | 16 July 2008 |
| Is the organization making profit? Or is the client looking for a tax deduction for donations? | |
| 16 July 2008 | |
| The organization is making a profit. But the client is looking for a tax deduction for donations. | |
| 16 July 2008 | |
| Bleblanc,
The following IRS information should help you get a handle on the topic: http://www.irs.gov/pub/irs-tege/eotopice87.pdf For historical perspective and the development of the IRS's view: http://www.irs.gov/pub/irs-tege/eotopich82.pdf and | |
| 16 July 2008 | |
| Let me explain the differences here -
501(c)(3) - is the only 501(c) organization in which contributions to it can be tax deductible to the donor. In order to obtain that, Form 1023 needs to be completed. It may also provide a state tax exemption from sales tax, depending upon which state you're located in. 501(c)(7) - is for a club membership organization. While it is tax exempt for IRS purposes - contributions to donors are not tax deductible. Form 1024 needs to be completed. It is also possible - that if the gross receipts are under $ 5,000 annually - you don't need to actually obtain tax exempt status - but before relying on this - I would check out the actual provision so you're not relying on vague information. | |
WIBadgerCPA (talk|edits) said: | 16 July 2008 |
| I've been successful filing Form 1023 for these clients. (Not sure where "school with a building" info is coming from) | |
| 18 July 2008 | |
| Bleblanc, re-read the 501(c)(3) provisions. The section specifically includes fostering national or interntional amateur sports competion. | |
