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IRS Lowers Filing Fees for New 501(c)(3) Applicants

IRS Lowers Filing Fees For New 501(c)(3) Applicants

Good news from the IRS usually sounds like the beginning of a funny joke…but not this time.  In an unexpected move, the IRS announced in late January a revised filing fee schedule for applicants for 501(c) status.  Most applicants will see their filing fee go down, though some at the lower end of the scale could see an increase.  Here’s the breakdown:

Form 1023…$600 for all filers (was $400 for budgets under $10k/yr; $850 for budgets over $10k/yr)

Form 1023-EZ…remains at $275 (was already lowered from $400 in July 2016)

Requests for group exemption status…$2,000 (was $3,000)

For more complete details, see the IRS Revenue Bulletin 2018-5 and scroll down to Appendix A.

Greg McRay, EA

Greg McRay is the founder and CEO of The Foundation Group. He is registered with the IRS as an Enrolled Agent and specializes in 501(c)(3) and other tax exemption issues.

This Post Has 10 Comments
  1. I am in a social club and we are a 501C. Our treasure took ill and have been out for over 6 months. She might not be returning. Our President and Vice president been doing the treasure duties also. Our Bylaw state no one can hold two position. What shall take place so we can stay in compliance with the law.

    1. Hi Chevelle,

      Without knowing all the details on how your board is set up, I would refer back to your Bylaws. If there is doubt around your treasurer returning, your Bylaws should have provisions on how to replace the board member so you can avoid having dual-capacity officers long-term.

  2. hello my name is tracy sherrills im trying to get my 501c3 ive been working under someones else and I want to receive my own what do I do

    1. Hi Tracy, thank you for reaching out to us! I recommenced looking over this page on our website: How to start a 501(c)(3) organization: https://www.501c3.org/how-to-start-a-501c3-nonprofit/

      If you don’t have prior experience with the IRS form requirements to start a nonprofit, we highly recommend professional services to ensure it is done correctly. Feel free to call our office line at 615-361-9445 or complete the inquiry form on this page: https://www.501c3.org/501c3-services/start-a-501c3-nonprofit/. We’d be happy to discuss your idea with you!

  3. Hi, I am starting a non profit organization which is charitable and educational. My purpose is to help the youth with educational funding like school supplies, tutoring, educational field trips, funding for college tuitions, youth mentoring, and youth after school food meals. My question is, how would I fill out the 1023 form and the state secretary form 202? So do I have to have board memebers for this type of organization to receive my certificate and exemption from the IRS?

    1. Hi, T. Thanks for reaching out. You are correct that a Form 1023 would have to be prepared. And yes, you will need a board of directors. But from your question, it’s obvious that this is all new to you. Starting a nonprofit and getting 501(c)(3) status is not a do-it-yourself project. I could fill a book with answers to only the questions you just asked. My advice is to get help with the formation of this charity. We’ve been doing this for clients for almost 23 years. Call and speak with one of our advisors.

  4. Hello Greg and Justin, This question is related to previous blog posts focused on distinguishing employee/contractor/volunteer. We started a nonprofit a few months ago that provides nature-based mentoring programs (we intend to apply for 501c3 status within the next year and appreciate finding you as a resource!) First year revenues are expected to be $10-$15k, with net profit essentially zero, so we are running pretty lean. One of the moms involved in our program has agreed to serve as a program mentor and to help us with social media. We are considering two options. 1) work-trade with no money changing hands…she serves as a program mentor and helps with social media (our benefit) in exchange for her kids participating in our programs for free (her benefit). 2) we hire her as an employee at essentially minimum wage, also offering a significant discount (40%) for her kids to participate in our programs. At this early stage of operations, do we have the flexibility to consider either option? Appreciate your perspective and guidance!

    1. Hi Shawna, thanks for posting this question! We would recommend your organization to go for option #2. Letting certain children participate in a service for free in exchange for service could raise questions from the IRS. If you haven’t already, I would recommend reaching out to our Nonprofit Advisors to go over your plans for this 501(c)(3) nonprofit. Our Nonprofit Formation services can help you navigate the application process and give you insights for long-term success! Feel free to call into our office at 615-361-9445 or complete an inquiry on our Nonprofit Formation page: https://www.501c3.org/501c3-services/start-a-501c3-nonprofit/

  5. Hello Greg,
    This question is from an old blog about private vs. public charities. I want to start a Peer Run organization, I do want it to be a family run organization. Most of the start-up costs are from our own personal resources. We do want to be able to solicit funds from the public. My siblings would be on the Board of Directors, I would be a paid employee essentially managing the day to day operations, training and offering peer services. I also would like to establish offices in more than one state, as we would be seeking contracts through the Department of Veterans Affairs to offer services to veterans. We are all disabled veterans.

    1. With that many complications and potential conflicts-of-interest, you definitely need assistance with setting up something like that. We recommend you talk with one of our sales advisors about our SureStart formation program. If you place an inquiry on our website, one of our Nonprofit Advisors will be sure to follow up with you!

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