EFTA00812069

Department of the Treasury Instructions for Form 1023 Internal Revenue Service (Rev. December 2017) Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code Section references are to the Internal Revenue Contents Page • Research your tax questions online. Code unless othenvise noted. • Search publications on by topic or Grants to Individuals and Contents Page Private Foundations keyword. Future Developments 1 Requesting Advance • Use the online Internal Revenue Code, Approval of Individual Grant Regulations, or other official guidance. What's New 1 Procedures 24 • View Internal Revenue Bulletins (IRBs) Overview of Section 501(c)(3) Appendix A: Sample Conflict of published in the last few years. Organizations 1 Interest Policy 26 • Sign up to receive local and national tax General Instructions 3 Appendix B: States with Statutory news by email. To subscribe, go to Answers 3 Provisions Satisfying the IRS.govichmilies-non-orolits. Purpose of Form 3 Requirements of Internal Obtaining Tax-Exempt Status 3 Revenue Code Section Tax forms and publications. You can 508(e) 28 download or print all of the forms and What to File 4 Appendix C: Glossary of Terms . 30 publications you may need at IRS.gov/ When to File 4 Index 36 FormsPubs. Otherwise you can go to Where To File 4 1RS.gov/OrderForms to place an order Filing Assistance 4 Note. Keep a copy of the completed and have forms mailed to you. You should Signature Requirements 4 Form 1023 for your permanent records. receive your order within 10 business Representation 4 days. Public Inspection 5 Foreign Organizations in General . 6 Future Developments Specific Instructions 6 For the latest information about Overview of Section 501(c) Part I. Identification of Applicant 6 developments related to Form 1023 and (3) Organizations Part II. Organizational Structure 7 Its instructions, such as legislation Part III. Required Provisions in enacted after they were published, go to Who Is Eligible for Section Your Organizing Document 8 IRS.gov/Form1023. 501(c)(3) Status? Part IV. Narrative Description of Phone Help Organizations organized and operated Your Activities 8 exclusively for religious, charitable, Part V. Compensation and Other If you have questions and/or need help completing Form 1023, please call scientific, testing for public safety, literary, Financial Arrangements With or educational purposes, or to foster Your Officers, Directors, 877-829-5500. This toll-free telephone Trustees, Employees, and service is available Monday through national or international amateur sports Independent Contractors 8 Friday. competition, or for the prevention of Part VI. Your Members and Other cruelty to children or animals are eligible Individuals and Organizations to file Form 1023 to obtain recognition of That Receive Benefits From What's New exemption from federal income tax under You 10 New section 170(b)(1)(A)(xl). Form section 501(c)(3) of the Internal Revenue Part VII. Your History 10 1023 includes the new public charity Code. Part VIII. Your Specific Activities . . status for section 170(b)(1)(A)(lx) Form 1023 not necessary. The Part IX. Financial Data 12 agricultural organizations. See Part X. following types of organizations may be Part X. Public Charity Status 15 Public Charity Status, new line 5g. considered tax exempt under section Part XI. User Fee Information 17 501(c)(3) even if they don't file Form 1023. Schedule A. Churches 17 User fees are updated annually. • Churches, including synagogues, Schedule B. Schools, Colleges, Organizations should reference Rev. Proc. temples, and mosques. and Universities 18 2017-5, 2017-1 I.R.B. 230, at ham& • Integrated auxiliaries of churches and Schedule C. Hospitals and core.publish.no.irsloWirblod1/ conventions or associations of churches. Medical Research wb201701.0clf or later revision for user • Any organization that has gross Organizations 19 fees (revised in the first Internal Revenue receipts in each tax year of normally not Schedule D. Section 509(a)(3) Bulletin (I.R.S.) issued each year). For more than $5,000. For more Information Supporting Organizations 21 additional information on the user fee, see on gross receipts exceptions, go to Schedule E. Organizations Not Part XL User Fee Information. 1RS.gov/Charities. Filing Form 1023 Within 27 Months of Formation 22 Even though the above organizations How To Get Forms and aren't required to file Form 1023 to be tax Schedule F. Homes for the Elderly or Handicapped and Publications exempt, these organizations may choose Low-Income Housing 23 to file Form 1023 in order to receive a Internet You can access the IRS website determination letter that recognizes their Schedule G. Successors to Other Organizations 24 24 hours a day, 7 days a week at 1RS.aov section 501(c)(3) status and specifies Schedule H. Organizations to do the following. whether contributions to them are tax Providing Scholarships, • Download forms, instructions, and deductible. Fellowships, Educational publications. Loans, or Other Educational • Order IRS products online. Jan 02, 2018 Cat. No. 17132z EFTA00812069 Qualification of a Section 501(c)(3) with respect to acts, bills, resolutions or foundations are subject to excise taxes Organization similar items (such as legislative that aren't imposed on public charities. confirmation of appointive offices). Public charities. The following 501(c)(3) There are two requirements for an Legislation also includes action by the organization to be exempt from federal organizations are classified as public public in a referendum, ballot initiative, charities. income tax under section 501(c)(3). A constitutional amendment, or similar 501(c)(3) organization must be organized • Churches. procedure. Legislation generally doesn't and operated exclusively for one or more • Schools. include actions by executive, judicial, or • Hospitals, medical research exempt purposes. administrative bodies. organizations, and cooperative hospital Organized. An organization must be Organizations may involve themselves service organizations. organized as a corporation (including a in issues of public policy without being • Organizations that receive substantial limited liability company), trust, or engaged in legislative activity. For support from grants, governmental units, unincorporated association. The example, organizations may conduct and/or contributions from the general organizing document (articles of educational meetings, prepare and public. incorporation if you are a corporation, distribute educational materials, or • Organizations that normally receive articles of organization if you are a limited otherwise consider public policy issues. more than one-third of their support from liability company, articles of association or Similarly, an organization may appear contributions, membership fees, and constitution if you are an association, or before a governmental body to offer gross receipts from activities related to trust agreement or declaration of trust if testimony about a decision that may affect their exempt functions, and not more than you are a trust) must limit the the organization's existence. one-third of their support from gross organization's purpose(s) and A private foundation isn't allowed investment income and net unrelated permanently dedicate its assets to exempt business income. to influence legislation. purposes. • Organizations that support other public Operated. An organization must be charities. Political campaign Intervention. All If an organization requests public operated to further one or more of the 501(c)(3) organizations are absolutely charity classification based on receiving exempt purposes stated in its organizing prohibited from directly or indirectly document. Certain other activities are substantial public support, it must continue participating or intervening in any political to seek significant and diversified public prohibited or restricted, including, but not limited to, the following activities. A 501(c) campaign on behalf of (or in opposition to) support contributions in later years. any candidate for elective public office. (3) organization must: Private foundation. A 501(c)(3) Non-partisan voter education activities • Absolutely refrain from participating in (including public forums and voter organization that can't meet one of the the political campaigns of candidates for specific exceptions to be classified as a education guides) are permitted. Similarly, local, state, or federal office; public charity is a private foundation. • Absolutely ensure that its assets and non-partisan activities to encourage people to participate in the electoral Classification as a private earnings don't unjustly enrich board process, such as voter registration and foundation has nothing to do with members, officers, key management get-out-the-vote drives, aren't prohibited employees, or other insiders; the name of the organization. political campaign activity. However, voter There are many organizations that include • Not further non-exempt purposes (such as purposes that benefit private interests) education or registration activities that (a) the word foundation in their names that favor one candidate over another, (b) aren't private foundations for tax more than insubstantially; oppose a candidate in some manner, or purposes. • Not operate for the primary purpose of (c) favor a group of candidates, are conducting a trade or business that isn't prohibited. Private operating foundations. A related to its exempt purpose(s); • Not engage in activities that are illegal private foundation that lacks general or violate fundamental public policy; and Public Charities and Private public support but actively conducts • Restrict its legislative activities. Foundations exempt programs (as opposed to making grants to other organizations to conduct Legislative activity. An organization Every organization that qualifies for exempt activities) may be treated as a doesn't qualify for section 501(c)(3) status tax-exempt status under section 501(c)(3) private operating foundation. Private if a substantial part of its activities is is further classified as either a public operating foundations are subject to more attempting to influence legislation. charity or a private foundation. For some favorable rules than other private organizations, the primary distinction foundations in terms of charitable Form 5768. Most public charities are between a public charity and a private eligible to elect to make expenditures to contribution deductions and attracting foundation is an organization's source of grants from private foundations. In order to influence legislation by filing Form 5768, financial support. be classified as a private operating Election/Revocation of Election by an Eligible Section 501(c)(3) Organization To foundation, an organization must meet Make Expenditures To Influence A public charity has a broad base of certain support tests. See support test at Legislation. By filing Form 5768, an support, while a private foundation IRS.gov/ eligible organization's legislative activities receives its support from a small number PrivateOperatingFoundationSuPPOrtTestS. will be measured solely by an expenditure of donors. This classification is important Also see new Private Operating limit rather than by the "no substantial because different tax rules apply to the Foundations-new organizations at amount" limit. For additional information operations of each entity. wynvirs.govicharities-non-profitsrivate- on the expenditure limit or the no foundations/private-operating- substantial amount limit, see Pub. 557, Deductibility of contributions to a fpundations-new-organizations Tax-Exempt Status for Your Organization. private foundation is more limited than contributions to a public charity. See Pub. State Registration Requirements For this purpose, legislation" includes action by Congress, a state legislature, a 526, Charitable Contributions, for more Information on the deductibility of Tax exemption under section 501(c)(3) is local council, or a similar governing body, a matter of federal law. After receiving contributions. In addition, private Instructions for Form 1023 EFTA00812070 federal tax exemption, you may also be Past, present, and planned activities. 4. Submit a written statement required to register with one or more Many items on Form 1023 are written in supporting its request if applying for states to solicit for contributions or to the present tense; however, your answers retroactive reinstatement. obtain exemption from state taxes. The should be based on your past, present, National Association of State Charity If the application is approved, the date and planned activities. of reinstatement generally will be the Officials (NASCO) maintains a website that provides Informational links to the Language and currency requirements. postmark date of the application, unless various states for these purposes. It can Prepare Form 1023 and attachments in the organization qualifies for retroactive be accessed at www.nasconet.org. English. Provide an English translation if reinstatement. Alternate submissions and the articles of organization or bylaws are in standards apply for retroactive any other language. reinstatement back to the date of General Instructions We may ask you to provide English automatic revocation. See Rev. Proc. Social Security Number. Don't enter 2014-11.2014-03IR.& 411 for details. translations of foreign language Social Security numbers on this form publications you submit with your Form Expedite Requests because the IRS is required to disclose 1023. approved exemption applications and We will only approve expedited Report financial information in U.S. processing of an application where a information returns. Documents subject to dollars (specify the conversion rate used). disclosure include supporting documents request is made in writing and contains a Combine amounts from within and outside compelling reason for processing the filed with the form and correspondence the United States and report the total for with the IRS about filing. application ahead of others. each on the financial statements. Circumstances generally warranting "You" and "Us". Throughout these expedited processing include the instructions and Form 1023, the terms Purpose of Form following. "you" and "your" refer to the organization • A grant to the applicant is pending and that is applying for tax-exempt status. The Completed Form 1023 required for the failure to secure the grant may have an terms "us" and "we" refer to the Internal section 501(c)(3) exemption. Form adverse impact on the organization's Revenue Service. 1023 is filed by organizations to apply for ability to continue operations. recognition of exemption from federal • The purpose of the newly created Definitions. Terms in bold type in Form income tax under section 501(c)(3). Upon 1023 are defined throughout these organization is to provide disaster relief to approval, we will issue a determination victims of emergencies such as floods and instructions and in Appendix C. letter that provides written assurance hurricanes. about the organization's tax-exempt • There have been undue delays in Answers status, and its qualification to receive issuing a letter caused by problems within Answer items completely. Where a "Yes" tax-deductible charitable contributions. the IRS. or "No- reply isn't requested, you may Every organization qualifying for answer "Not Applicable" where exemption under section 501(c)(3) will User Fee appropriate. If you believe you have also be classified as either a "public The law requires payment of a user fee previously answered the Item, you may charity" or a "private foundation." with each application. Enclose payment refer to your previous answer. Other organizations that may file with your application. DON'T STAPLE or Your answers must provide Form 1023. Other organizations that otherwise attach your check or money 4 sufficient detailabout your past, present, andplannedactivities to prove that you are an exempt apply for tax-exempt status under section 501(c)(3) by filing Form 1023 Include section 501(e) and (f) cooperative service order to your application. You may pay your user fee with a personal or certified check, bank check, or organization. We will not be able to organizations, section 501(k) childcare cashier's check. Processing your recognize you as tax exempt based on organizations, and section 501(n) application will not be delayed by the form generalizations. Therefore, we need to charitable risk pools. of payment unless your check is returned understand the specific activities you will to us for Insufficient funds. undertake to reach your charitable goals. Obtaining Tax-Exempt Status Additional guidance regarding user Financial data. Form 1023 asks you to fees is available in Rev. Proc. 2017-5, answer a series of questions and provide To apply for tax-exempt status, file Form 2007-1 I.R.B. 230, at WM information to assist us in determining if 1023 and pay the appropriate user fee. core.publish.no.irs.govArb/Ddf/ you meet the requirements for tax Application for Reinstatement wb201701.pdf or later revision (revised in exemption under section 501(c)(3). One of the first I.R.B. issued each year). the pieces of Information requested is and Retroactive Reinstatement financial data. This data, whether An organization must apply to have its For additional information on the user budgeted or actual, should be consistent tax-exempt status reinstated if it was fee, see Part XL User Fee Information. with other Information presented in the automatically revoked for failure to file a application. return or notice for three consecutive Group Exemption years. The organization must: Form 1023 isn't used to apply for a group For example, if you are requesting public charity status under one of the 1. Complete and file the appropriate exemption. A group exemption is issued to application form, a central organization that recognizes on a public support tests, the financial data should show contributions from the public group basis the exemption of subordinate 2. Pay the appropriate user fee and organizations on whose behalf the central or receipts from providing exempt enclose it with the application, organization has applied. See Pub. 557 for services. Budgeted financial data should be prepared based upon your current 3. Write 'Automatically Revoked" at information on how to apply for a group the top of the application and mailing exemption. plans. We recognize that the organization's actual financial results may envelope, and Leaving a group exemption. If a vary from the budgeted amounts. subordinate organization in an existing group exemption wishes to apply for an Instructions for Form 1023 EFTA00812071 individual exemption, it should notify Its • Amendments to organizing document in The PDS can tell you how to get written parent organization of its intention to leave chronological order. proof of the mail date. If you're using PDS, the group ruling before filing Form 1023. • Bylaws or other rules of operation and send your application, user fee, and all amendments. other required information to: What to File • Documentation of nondiscriminatory All applicants, unless otherwise noted, policy for schools, as required by Internal Revenue Service Schedule B. Attention: EO Determination Letters must complete Parts I through XI of Form 1023, plus any required schedules and • Form 5768. Stop 31 attachments. • All other attachments, including 201 West Rivercenter Boulevard explanations, financial data, and printed Covington, KY 41011 The following organizations must materials or publications. complete additional schedules to Form Private delivery services can't 1023. Attachments deliver items to P.O. boxes. You Use an attachment where there is Ak must use the U.S. Postal Service THEN you insufficient space on the form for you to to mail any items to an IRS P.O. box IF your organization must file legibly and accurately respond to a address. Is a(n) Schedule .. question. For any attachments submitted with your Form 1023: Church A • Use 81/2 x 11 Inch paper, Filing Assistance School, College, or • Provide your name and Employer For help in completing this form or general University Identification Number (EIN) at the top of questions relating to an exempt each page, and organization, you may access Information Hospital or Medical • Identify the Part and number to which on our website at IRS.gov/EO. Research the attachment relates. Organization Listed below are a number of Include any court decisions, rulings, publications and a searchable link that Section 509(a)(3) opinions, or any other documents that will may be helpful to your organization. Supporting assist us in processing your Form 1023. Organization • Pub. 517, Social Security and Other Organization Not Filing Attachments in the form of tape Information for Members of the Clergy and Form 1023 Within 27 recordings or other electronic media aren't Religious Workers acceptable unless accompanied by a • Pub. 526, Charitable Contributions Months of transcript. Attachments must be In • Pub. 557, Tax-Exempt Status for Your Formation English. Organization Home for the Elderly or • Pub. 598, Tax on Unrelated Business Handicapped and When to File Income of Exempt Organizations Low-Income Generally, if you file Form 1023 within 27 • Pub. 1771, Charitable Contributions Housing F months after the end of the month in which Substantiation and Disclosure you were legally formed, and we approve Requirements Successor to Other the application, the legal date of formation • Pub. 1828, Tax Guide for Churches and Organizations G will be the effective date of your exempt Religious Organizations Organization Providing status. • Pub. 3079, Gaming Publication for Scholarships, Tax-Exempt Organizations Fellowships, Educational If you don't file Form 1023 within 27 • Pub. 3833, Disaster Relief: Providing Loans, or Other months of formation, the effective date of Assistance through Charitable Educational Grants to your exempt status will be the date you Organizations Individuals and Private filed Form 1023 (submission date). The • Pub. 4220, Applying for 501(c)(3) Foundations Requesting date considered to be the date we receive Tax-Exempt Status Approval of Individual Form 1023 Is generally the postmark date. • Pub. 4221, Compliance Guide for Grant Procedures . . H For exceptions and special rules, 501(c)(3) Tax-Exempt Organizations including automatic extensions, see Schedule E of Form 1023. You can search organizations eligible to receive tax-deductible charitable Where To File contributions at /RS.govaPub78. Assembly of Application Send the completed Form 1023, user fee Package payment, and all other required Signature Requirements To assist us in processing the application, information to: An officer, director, trustee, or other official documents should be submitted in the who is authorized to sign for the following order. Internal Revenue Service organization must sign Form 1023 at the • User fee enclosed but not attached to Attention: EO Determination Letters end of Part XI. The signature must be the application form. Stop 31 accompanied by the title or authority of the • Form 1023 Checklist. P.O. Box 12192 signer and the date. Please clearly print • Form 2848, Power of Attorney and Covington, KY 41012-0192 the accompanying information. Declaration of Representative (if needed). • Form 8821, Tax Information Private Delivery Service Representation Authorization (if needed). • Expedite request Of needed). Organizations can use certain private Form 2848. Attach a completed Form • Application Form 1023 and Schedules delivery services (PDS) designated by the 2848 if you want to authorize a A through H (as required). IRS to meet the "timely mailing as timely representative to represent you regarding • Organizing document. filing" rule for tax returns. Go to IRS.gov/ your application. An individual authorized PDS for the list of PDS. by Form 2848 may not sign the application Instructions for Form 1023 EFTA00812072 unless that person is also an officer, Figure 1.990 Series Forms filed by Exempt Organizations director, trustee, or other official who is authorized to sign the application. Type of Annual Return Who Should Flle A centralizedauthorization file (CAF) number isn't required to be listed on Form 2848. Form 990, Retum of Organization Section 501(c)(3) public charities Form 8821. Form 8821 authorizes us to Exempt from Income Tax discuss your application with the person you have appointed. Form 990-EZ, Short Form Return of Section 501(c)(3) public charities whose Form 8821 doesn't authorize your Organization Exempt from Income Tax gross receipts during the year were less appointee to advocate your position with than $200,000 and total assets at the respect to the Federal tax laws; to execute end of the year were less than $500,000 waivers, consents, or closing agreements; or to otherwise represent you before the Schedule A (Form 990 or 990-EZ), Section 501(c)(3) public charities IRS. If you want to authorize an individual Organization Exempt under Section to represent you, use Form 2848. 501(c)(3) After You Submit Form 1023 Schedule B (Form 990, 990-EZ, or All section 501(c)(3) organizations We will acknowledge receiving your 990-PF), Schedule of Contributors application in writing. You may expect to receive this notice within 21 days of the Form 990-PF, Return of Private Private foundations, including private postmark date of the Form 1023. Read the Foundation operating foundations notice thoroughly because it will provide further information about the processing of Form 990-7, Exempt Organization Public charities and private foundations your Form 1023. Business Income Tax Return that have gross unrelated business income of $1,000 or more Generally, we assign applications in the order we receive them. Unless the Form 990-N Electronic Notice Tax-exempt organizations that don't file application is approved for expedited (e-Postcard) for Tax-Exempt Form 990 or Form 990-EZ can file Form processing, it will be worked in the order Organizations Not Required to File Form 990-N. Most small tax-exempt received. 990 or Form 990-EZ organizations with gross receipts of No additionalInformation needed. $50,000 or less can file a Form 990-N. If our review shows that you qualify, we will send you a letter stating that you are exempt under section 501(c)(3) and You may also be required to file Information not available for public whether you are a public charity or a other returns, such as Inspection. The following items will not private foundation. employment tax returns or benefit be open for public inspection. Additional information needed. If plan returns, which aren't discussed here. • Any information relating to a trade the review shows that we need additional secret, patent, style of work, or apparatus information or changes, we will call or Public Inspection that, if released, would adversely affect write you. Examples of the types of you. (We must approve withholding this questions you may be asked are available Information available for public In- information.) at IRS.00v. spection. If we approve exempt status • Any other information that would If the additional information indicates under section 501(c)(3), the following adversely affect national defense. (We that you qualify, we will send you a letter information will be open for public must approve withholding this stating that you are exempt under section inspection. information.) 501(c)(3) and whether you are a public • Your complete Form 1023 and any • User fee check. charity or a private foundation. If we supporting documents. • Information only applications from the conclude that you don't qualify for • All correspondence between you and United States Virgin Islands, Bureau of exemption, we will send you a letter that the IRS concerning Form 1023, including Internal Revenue (BIR), and related explains our position and your appeal Form 2848. supporting documents. rights. • The letter we issue approving your • Contributors' names and addresses exemption. and identifying information about Annual Filing Requirements • Annual information returns (Forms 990, contributors included with Forms 990 or If an annual information return or tax return 990-EZ, or 990-PF). 990-EZ and the Schedule B filed with is due while the Form 1023 is pending, • Schedule A, included with Forms 990 or these forms. complete the return, mark "Application 990-EZ. • Form 990-T, Exempt Organization Pending" in the heading, and send the • Schedule B, included with Forms 990 or Business Income Tax Return. return to the address indicated in these 990-EZ, except the names and addresses When applying for tax-exempt status, instructions. of contributors and other identifying you must clearly identify any information information about contributors. that isn't open for public inspection by Information on return filing • Schedule B, included with Form separately marking it as "NOT SUBJECT requirements and exceptions may be 990-PF, including names, addresses and TO PUBLIC INSPECTION" and attaching found in Pubs. 557 and 598 and in the other identifying information about an explanation of why you are asking for instructions to the annual returns listed in contributors. the information to be withheld. We will Figure 1. decide whether to withhold the identified information from public inspection. Instructions for Form 1023 EFTA00812073 Making documents available for public organization, other than a private The information only procedure requires Inspection. Both you and the IRS must foundation, may be relieved from filing the BIR to complete Form 1023 and make the information that is subject to Form 990 or Form 990-EZ in any year in supporting documents for the disclosure available for public inspection. which it has gross receipts from U.S. organization, but doesn't require a user The public may contact us toll-free at source income of $50,000 or less and fee payment. The application and 877-829-5500 to request public inspection hasn't conducted significant activity in the supporting documents aren't open for or copies of the information. The public United States. See the Instructions for public inspection (see Public Inspection, may also request inspection of the Form 990 and Form 990-EZ, and the above for more information). information or a copy of the information Instructions for Form 990-PF for further directly from you. information. A foreign organization that is All other Virgin Islands organizations subject to unrelated business income tax that seek U.S. recognition of exempt An exempt organization may post the must file Form 990-T. status under section 501(c)(3) must follow documents required to be available for the normal application process. public inspection on its own website. The Canadian Organizations information return and exemption Canadian organizations that have application materials must be posted received a Notification of Registration from Specific Instructions exactly as filed with the IRS. Only the the Canada Customs and Revenue information that isn't open for public Agency (formerly, Revenue Canada), and Part I. Identification of inspection may be deleted. whose registrations haven't been revoked Applicant If an exempt organization posts the ("Canadian registered charities"), are documents on its website, it must provide automatically recognized as section Line 1. Full name of organization. notice of the website address where the 501(c)(3) organizations and aren't Enter your complete name exactly as it documents may be found, but it need not required to file Form 1023. Canadian appears in your organizing document, provide copies of the information. registered charities are also presumed to including amendments. However, documents posted on an be private foundations. A Canadian Line 2. do Name. If you have an "in care organization's website must still be made registered charity may complete certain of name, enter it here. available for public inspection without portions of the Form 1023 in order to be charge at its main office during regular listed as a section 501(c)(3) organization Line 3. Mailing address. Enter your business hours. on the IRS website at 1RS.00v/Pub78 or complete address where all Documents aren't considered available to request classification as a public correspondence will be sent. If mail isn't for public inspection on a website if the charity, rather than a private foundation. A delivered to the street address and you otherwise disclosable information is edited Canadian registered charity should only have a P.O. Box, show the box number or subject to editing by a third party when complete and submit the following instead of the street address. posted. To date, the IRS hasn't approved documents. For a foreign address, enter the any third party websites for posting. • Copy of its Notification of Registration. information in the following order: city, • Part I of Form 1023. province or state, and country. Follow the See Pub. 557 for additional guidance • Part X of Form 1023 (if requesting on public inspection. country's practice in placing the postal public charity classification). code in the address. Don't abbreviate the • Signature in Part XI of Form 1023. country name. Foreign Organizations in • Form 8833, Treaty-Based Return General Position Disclosure Under Section 6114 or Line 4. Employer Identification Num- 7701(b). ber (EIN). All organizations must have an Foreign organizations are those that were EIN. Enter the nine-digit EIN the IRS created in countries other than the United Organizations Created in assigned to the organization. If the States, its territories, or its possessions. organization doesn't have an EIN, it must Foreign organizations may apply for United States Territories and apply for one. An EIN can be applied for tax-exempt status on income earned in the Possessions by visiting the IRS website at 1RS.gov/EIN. United States in the same way that Organizations created in possessions and The organization may also apply for an domestic organizations apply for exempt territories of the United States are EIN by faxing or mailing Form SS-4 to the status. See Language and currency generally treated as domestic IRS. The Form SS-4 and its separate requirements, above. organizations. These organizations instructions can be downloaded from A foreign organization applying for complete all required pans of Form 1023 IRS.gov. Organizations outside the United exempt status should complete all to apply for exempt status under section States or U.S. possessions may also required parts of Form 1023. There are, 501(c)(3). Special rules, discussed below, apply for an EIN by calling 267-941-1099 however, special rules below for some apply to some Virgin Islands (toll call). Don't apply for an EIN more than Canadian organizations. organizations. once. Contributions by U.S. residents to Charitable contributions to If the organization has more than one foreign organizations generally organizations created in United States EIN and hasn't been advised which to use, aren't deductible. Tax treaties possessions and territories are deductible notify the: between the U.S. and certain foreign by the donors if the organization qualifies Department of the Treasury countries provide specific limited for exempt status under section 501(c)(3). exceptions. Internal Revenue Service Center Virgin Islands Organizations Ogden, UT 84201.0027 Annual returns for foreign organiza- The United States Virgin Islands, Bureau tions. A foreign organization that obtains of Internal Revenue (BIR) may request an State what EINs the organization has, exemption as a public charity must file an information only letter concerning the the name and address to which each information retum annually (Form 990 or exempt status under section 501(c)(3) of number was assigned, and the address of Form 990-EZ). A foreign organization that an organization formed in the Virgin the organization's principal office. The IRS is a private foundation must file Form Islands. The organization itself doesn't will advise the organization which number 990-PF annually. However, a foreign seek U.S. recognition of exempt status. to use. Instructions for Form 1023 EFTA00812074 Line 5. Month the annual accounting 990 and Form 990-EZ. See IRS.gov for document is its state-approved "articles of period ends (01-12). Enter the month more information. organization." If it has adopted an that your annual accounting period ends, Private foundations must file Form "operating agreement," then this using a two-digit number format. For document is also part of its organizing 990-PFregardless of the amount example, if your annual accounting period of their gross receipts. document. ends in December, enter "12." Your An LLC shouldn't file an exemption annual accounting period is the 12-month Line 11. List the date you were legally application if it wants to be treated as a period on which your annual financial created by month, day, and year (for disregarded entity by its tax-exempt records are based. Your first tax year example, 02/01/2018). The date should be member. could be less than 12 months. consistent with your organizing document Line 3. An "unincorporated association" Check your bylaws or other rules of described in Part II. formed under state law must have at least operation for consistency with the annual Line 12. For purposes of completing this two members who have signed a written accounting period entered in line 5. application, you are formed under the laws document for a specifically defined Line 6a. Primary contact. Your primary of a foreign country if you aren't formed purpose. contact person may be an officer, director, under the laws of the United States, its The articles of organization of an trustee, or other individual who is territories and possessions; federally unincorporated association must include permitted to speak with us according to recognized Indian tribal or Alaska Native the name of your organization, your your bylaws or other rules of operation. governments; or the District of Columbia. purpose, the date the document was Your primary contact person may also be adopted, and the signatures of at least two an "authorized representative," such as an Part II. Organizational individuals. If your copy doesn't contain attorney or certified public accountant for Structure the proper signatures and date of whom you have submitted a completed adoption, you may submit a written Form 2848 with the Form 1023. Only trusts, unincorporated associations, declaration that states your copy is a or corporations (including limited liability complete and accurate copy of the signed Line 7. If you wish to be represented by companies) are eligible for tax-exempt and dated original. Your declaration an authorized representative, a completed status under section 501(c)(3). Sole should clearly indicate the original date of Form 2848 must be attached to the Form proprietorships, partnerships, or loosely 1023. adoption. affiliated groups of individuals aren't eligible. Bylaws may be considered an Line 8. Provide information about organizing document only if they persons, other than your officers, To qualify for tax-exempt status, you must check "Yes" on either line 1,2,3, or are property structured (includes directors, trustees, employees, or authorized representative(s), whom you 4 and submit a copy of your organizing name, purpose, signatures, andintent to document. form an organization). paid, or promised to pay, to assist you in establishing your organization, developing Line 1. A "corporation" is an entity Line 4a. A trust may be formed by a trust programs to solicit funds, or otherwise organized under a Federal or state statute, agreement or declaration of trust. A trust advising you about organizational, or a statute of a federally recognized may also be formed through a will. financial, or tax matters. Indian tribal or Alaskan native If your trust agreement copy doesn't For example, provide information about government. A corporation's organizing contain the proper signatures, you may a paid consultant who advised you about document is its "articles of incorporation." submit a written declaration that states obtaining tax exemption. your copy is a complete and accurate Certification of filing. If formed under Line 9a. Organization's website. Enter state statute, your articles of incorporation copy of the signed and dated original. your complete website address if you must show certification of filing. This Your declaration should clearly indicate have one. Also, list any websites means your articles show evidence that on the original date that it was signed. maintained on your behalf. The a specific date they were filed with and information on your website should be Trust created by a will. For trusts approved by an appropriate state created by a will, include a copy of the consistent with the information in your authority. The document must be an exact Form 1023. death certificate or a statement indicating copy of what is on file with your state. the date of death, and a copy of the Line 9b. Email (optional). Enter your Substitute Articles ofIncorporation. relevant portions of the will. email address to receive educational If you don't have a copy of your articles of information from us in the future. Because Trust agreement and non-charitable incorporation showing evidence of having interests. If your trust agreement of security concerns, we can't send or been filed and approved by an appropriate respond to confidential information via provided for distributions for state official, you may submit a substitute non-charitable interests, indicate the date email. copy of your articles of incorporation. This on which these interests expired. If your Line 10. Certain organizations aren't substitute copy may be handwritten, trust agreement continues to provide for required to file an information return (Form typed, printed, or otherwise reproduced. It these interests, you will not qualify for 990 or Form 990-EZ) or notice (Form must be accompanied by a declaration, tax-exempt status. 990-N). Generally, organizations not signed by an officer authorized to sign for required to file Form 990, or Form 990-EZ, you, that it is a complete and correct copy Line 4b. Generally, a trust must be or Form 990-N include churches, certain of the articles of incorporation and that it funded with property, such as money, real church affiliated organizations, and certain contains all the powers, principles, estate, or personal property to be legally affiliates of a governmental unit. Note that purposes, functions, and other provisions created. organizations that are exempt from filing by which you currently govern yourself. Line 5. "Bylaws" are generally the internal Form 990 or Form 990-EZ because of Line 2. A "limited liability company" (LLC) rules and regulations of an organization. If gross receipts are generally required to that files its own exemption application is you have bylaws, you should submit a submit Form 990-N if they choose not to treated as a corporation rather than a current copy. file Form 990 or Form 990-EZ. For more partnership. Instead of articles of information, see the Instructions for Form incorporation, an LLC's organizing Instructions for Form 1023 EFTA00812075 Bylaws don't need to be signed unless evidence that it was signed, dated, and Foreign organizations. Foreign they are the organizing document as certified as described in Part II. organizations may be able to rely upon the described in line 3 above. Line 2a. Dissolution clause. Your applicable laws of their jurisdiction in a organizing document must permanently similar manner. You must provide a copy Part III. Required dedicate your assets for a section 501(c) of the applicable law with an English Provisions in Your (3) purpose. This means that If you translation. Organizing Document dissolve your organization In the future, your assets must be distributed for an Part IV. Narrative Line 1. Purpose clause. Your organizing exempt purpose described in section Description of Your document must limit your purposes to 501(c)(3), or to the federal government, or those described in section 501(c)(3). to a state or local government for a public Activities Those purposes are: charitable, religious, purpose. Describe completely and in detail your educational, scientific, literary, testing for If your organizing document states that past, present, and planned activities. Don't public safety, fostering national or your assets would be distributed to refer to or repeat the purposes in your international amateur sports competition, members or private Individuals or for any organizing document. You may refer to and preventing cruelty to children or purpose other than those provided in other parts of the application rather than animals. section 501(c)(3), you must amend your repeat information provided elsewhere. The generally accepted legal definition organizing document to remove such For each past, present, or planned of "charitable" includes relief of the poor, statements. activity, include information that answers the distressed, or the underprivileged; If multiple amendments are required, the following questions. advancement of religion; advancement of they may be done at the same time. For • What is the activity? education or science; erecting or example, if you are a corporation and are • Who conducts the activity? maintaining public buildings, monuments, required to amend both your purpose and • When Is the activity conducted? or works; lessening the burdens of dissolution clauses, you may file a single • Where Is the activity conducted (for government; lessening neighborhood amending document with your appropriate example: Los Angeles and San Francisco, tensions; eliminating prejudice and government authority. California)? discrimination; defending human and civil • How does the activity further your rights secured by law; and combating The following is an example of an acceptable dissolution clause: exempt purposes? community deterioration and juvenile • What percentage of your total time is delinquency. Therefore, the phrase "relief allocated to the activity? of the poor in your organizing document Upon the dissolution of this organization, assets shallbe • How is the activity funded? (This should properly limits your purposes. agree with the financial data In Part IX.) distributed for one or more If your purposes are limited in some • List any alternate names under which exempt purposes within the you operate, including any "aka" (also way by referring to section 501(c)(3), your organizing document also properly limits meaning of section 501(c)(3) of known as) or "dba" (doing business as) your purposes. For example, the phrase the InternalRevenue Code, or names. "relief of the elderly within the meaning of corresponding section of any future federal tax code, or shall If you have a website, you may attach a section 501(c)(3)" in your organizing be distributed to the federal paper copy to support your narrative document also properly limits your description of activities. purposes. government, or to a state or However, if the purposes listed in your local govemment, fora public purpose. Part V. Compensation and organizing document are broader than those listed In section 501(c)(3), you Other Financial should amend your organizing document Arrangements With Your before applying. A reference to section Naming a specific organization to 501(c)(3) will not ensure that your receive your assets upon dissolution will Officers, Directors, purposes are limited to those described in only be acceptable if your articles state Trustees, Employees, and section 501(c)(3). All of the language in that the specific organization must be exempt under section 501(c)(3) at the time Independent Contractors your organizing document must be considered. The following Is an example your dissolution takes place and your Compensation. For purposes of Part V, of an acceptable purpose clause: articles provide for an acceptable compensation includes, alternative if the specific organization isn't • Salary or wages; The organization is organized exempt. See Pub. 557 for further • Deferred compensation; exclusively for charitable, information and examples of acceptable • Retirement benefits, whether in the religious, educational, and language for dedication of assets in your form of a qualified or non-qualified organizing document. employee plan (pensions or annuities); scientific purposes under section 501(O(3) of the Internal Line 2c. Operation of state law. A • Fringe benefits (personal vehicle, 501(c)(3) organization must permanently meals, lodging, personal and family Revenue Code, or educational benefits, low interest loans, corresponding section of any dedicate its assets to an exempt purpose described in section 501(c)(3), or to the payment of personal travel, entertainment, future federal tax code. or other expenses, athletic or country club federal government or to a state or local government for a public purpose. In membership, and personal use of your certain states, reliance may be placed property); and bonuses. See Pub. 557 for further information and examples of how to limit your upon state law to establish the permanent Example. Assume an organization purposes. dedication of assets for exempt purposes. compensates Its director as follows. This is based on Rev. Proc. 82-2, 1982-1 Any amendment to your articles of C.B. 367. For additional information, organization you submit should show search 'Operation of state law" at IRS.gov. Instructions for Form 1023 EFTA00812076 Wages compensated independent contractors Line 6a. Affixed payment" means a who will receive more than $100,000 in payment that is either a set dollar amount Director Compensation $ 2,500 taxable or non-taxable compensation per or fixed through a specific formula where Salary as Chief Executive 40,000 year. the amount doesn't depend on discretion. Officer For example, a base salary of $200,000 Line 3b. "Common control" means that Deferred retirement 2.000 you and one or more other organizations that is adjusted annually based on the Health insurance policy 5,000 have (1) a majority of your governing increase in the Consumer Price Index is a Use of a vehicle 5,000 boards or officers appointed or elected by fixed payment. Total Compensation $ 54,500 the same organization(s), or (2) a majority A -non-fixed payment" means a of your governing boards or officers payment that depends on discretion. For consist of the same individuals. Common example, a bonus of up to $100,000 that is Information in Pan V must be consistent control also occurs when you and one or based on an evaluation of performance by with the information provided in Part IX. more commonly controlled organizations the governing board is a non-fixed Financial Data. have a majority ownership interest in a payment because the governing body has corporation, partnership, or trust. See the discretion over whether the bonus is paid Line la. For each person listed, state instructions for line 2a, above, for a and the amount of the bonus. their total annual compensation, or definition of ownership. proposed compensation, for all services to Line 7a. Don't include purchases of the organization, whether as an officer, Line 4. By adopting these recommended goods and services in your normal course employee, or other position. Use actual compensation-setting practices, such as of operations that are available to the figures, if available. Officers, directors, by resolution of your governing board, you general public under similar terms and and trustees may use the organization's will be establishing procedures aimed at conditions. address for mailing. helping to prevent your top officials from receiving excess compensation benefits. Arm's length. An arm's length Line lb. Employees may use the standard exists where the parties have an organization's address for mailing. Report Line 4e. "Similarly situated organizations" adverse (or opposing) interest. For total compensation. For employees who means tax-exempt or taxable example, a seller wants to sell his goods are also officers, directors, or trustees, organizations of a comparable size, at the highest possible price, while a buyer their compensation as employees and for purpose, and resources. Adjustments due wants to buy at the lowest possible price. all other services should be reported in to geographic area, and other specific These are adverse interests. line la. conditions are appropriate, but should be In negotiating with a person, an documented. The source(s) of adverse interest is assumed if that person Line lc. "Independent contractors' are comparable compensation data, both persons who aren't treated as employees is otherwise unrelated to you in the sense taxable and non-taxable, should be for employment tax purposes. For of not being in a position to exercise documented and copies retained in your substantial influence over you or your information on determining if an individual permanent records. is an employee or an independent affairs. If the person is in a position to contractor, see Pub. 15-A, Employer's Line 4g. "Reasonable compensation" is exercise substantial influence over your Supplemental Tax Guide. the amount that would ordinarily be paid affairs, then an arm's length standard for like services by like organizations requires additional precautions to Line 2a. Describe family or business under like circumstances as of the date eliminate the effect of the relationship. relationships between your officers, the compensation arrangement is made. directors, or trustees. "Related" refers to Using a conflict of interest policy, Establishing and documenting reasonable information about comparable both family and business relationships. compensation is important because transactions between unrelated parties, "Family relationships" include the excessive compensation may result in and reliable methods for evaluating the individual's spouse, ancestors, children, excise taxes on both the individual and the transaction, are examples of precautions grandchildren, great-grandchildren, organization. In addition, this may that would help make the negotiation siblings (whether by whole or half blood), jeopardize the organization's tax process equivalent to one between and the spouses of children, exemption. unrelated persons. grandchildren, great-grandchildren, and Line 5a. Astonffict of interest" arises Fair market value. This is the price at siblings. when a person in a position of authority which property or the right to use property "Business relationships" include over an organization, such as a director, employment and contractual relationships, would change hands between a willing officer, or manager, may benefit buyer and a willing seller, neither being and common ownership of a business personally from a decision he or she could where any officers, directors, or trustees, under any compulsion to buy, sell, or make. A Sample Conflict ofInterest Policy transfer property or the right to use individually or together, possess more is included as Appendix A. This sample than a 35% ownership interest in common. property, and both having reasonable conflict of interest policy doesn't prescribe knowledge of relevant facts. "Ownership" means voting power in a any specific requirements. Therefore, corporation, profits interest in a organizations should use a conflict of Line 7b. Don't include sales of goods and partnership, or beneficial interest in a trust. interest policy that best fits their services in your normal course of organization. operations that are available to the Line 2b. Describe family or business general public under similar terms and relationships between you and any of your Adoption of a conflict of interest policy isn't required to obtain tax-exempt status. conditions. officers, directors, or trustees other than their position with you as an officer, However, by adopting the sample policy or Line 9a. Answer "Yes" if any of your director, or trustee. a similar policy, you will be choosing to put officers, directors, or trustees: in place procedures that will help you • Is an officer, director, or trustee in Line 2c. Describe family or business avoid the possibility that those in positions another organization (other than a section relationships between your officers, of authority over you may receive an 501(c)(3) organization) that has a lease, directors, or trustees and your five highest inappropriate benefit. contract, loan, or other agreement with compensated employees or five highest you, or Instructions for Form 1023 EFTA00812077 • Possess more than a 35% ownership Part VIII. Your Specific preselected pattern to win the game. interest in any organization that has a Other gaming activities include pull-tabs, lease, contract, loan, or other agreement Activities raffles, keno, split-the-pot, and other with you. For example, you would answer Line 1. You participate in a political games of chance. -Yes" if one of your directors were an campaign if you promote or oppose the Describe these activities, including how officer for a section 501(c)(4) organization candidacy of an individual for public office. often your bingo or other gaming activities with whom you had a lease for office Your explanation should Include are conducted, where they are conducted, space. You would also answer "Yes" if one representative copies of your political and who conducts them. Also describe of your directors owns more than 35% of literature, brochures, pamphlets, etc. whether your workers are compensated. If the voting stock of a corporation to which Candidate debates and nonpartisan voter workers are compensated, describe who you made a loan. education are permitted. receives compensation and how the Organizations describedin amount is determined. Part VI. Your Members and section 501(c)(3) are prohibited Revenue associated with these Other Individuals and from supporting or opposing activities means gross revenue amounts. Organizations That candidates for public office in any political Expenses associated with these campaign. Ifyou answer - Yes,"you aren't activities means direct and indirect Receive Benefits From qualified for tax exemption under section expenses. The dollar value of prizes You 501(c)(3) and shouldreconsider whether should be included in expenses. the filing of application Form 1023 is Line la. Benefits to individuals. Gaming may be subject to appropriate for your organization. See Describe any programs where you provide Pub. 557 for a description of other Internal unrelated business income tax. goods, services, or funds to individuals. See Pub. 3079 for further Revenue Code sections under which you For example, describe programs by which may qualify. information about gaming. you provide food to the homeless, employment counseling to senior citizens, Line 2a. You are attempting to Influence Line 3c. Local jurisdictions include cities, or grants to victims of a disaster. legislation" if you directly contact or urge counties, towns, municipalities, and Line lb. Benefits to organizations. the public to contact members of a similar government jurisdictions within a Describe any programs where you provide legislative body for the purpose of state. A local jurisdiction also includes an goods, services, or funds to organizations. proposing, supporting, or opposing Indian Reservation. For example, programs where you provide legislation. You are also attempting to Line 4a. "Fundraising" includes efforts to equipment, accounting assistance, or influence legislation if you advocate the raise funds through appeals for financial grants to other organizations. adoption or rejection of legislation. If you support. Fundraising may be conducted answer "Yes," your explanation should by your employees or volunteers, through Line 2. For programs that are available include the percentage of your total time only for members, include a sample an agent, or through an independent and total funds spent on such legislative contractor. If you answer "Yes," check all membership application and a schedule of activities. Also, submit representative membership dues. Also, describe any the boxes that apply and complete lines copies of your legislative literature, 4b through 4e. different membership levels and the brochures, pamphlets, etc. benefits each membership level receives. Line 4d. Local jurisdictions include cities, Organizations described in section counties, towns, municipalities, and Line 3. Describe any business or family 501(c)(3) are prohibited from engaging in relationship between Individuals who similar government jurisdictions within a a substantial amount of legislative state. A local jurisdiction also Includes an receive goods, services, or funds through activities. Whether you are engaged in your programs with any officer, director, Indian Reservation. substantial legislative activities depends trustee, or with any of the five-highest on all of the facts and circumstances. Line 4e. This is intended to obtain compensated employees or independent information from you regarding contractors listed In Part V, line 1a, lb, or Line 2b. By filing Form 5768 your donor-advised funds that you may lc. legislative activities will be measured maintain. A "donor-advised fund" is solely by expenditure limits under section maintained if you establish separate Part VII. Your History 501(h) rather than by whether legislative accounts for a donor whereby the donor activity is considered substantial. Form may exercise a right to make a Line 1. You are a "successor" if you 5768 describes the types of organizations recommendation on either uses of the have: that are eligible to make an election. For a account, such as providing advice about • Substantially taken over all of the discussion of the requirements of section how to invest, or distributions from the assets or activities of another 501(h), see Pub. 557. If you are an account, such as providing advice about organization, organization that elects to use expenditure how to make expenditures. • Been converted or merged from limits In Influencing legislation: another organization, or • Attach a copy of Form 5768 that has Line 5. You are "affiliated" with a • Installed the same officers, directors, or already been separately filed with us, or governmental unit if you were created by, trustees as another organization that no • Provide a completed Form 5768 with controlled by, or closely related to a longer exists and that had purpose(s) your exemption application. governmental unit. Identify each similar to your purpose(s). governmental unit and describe your Churches andprivate foundations relationship with It. Include details of any The predecessor organization aren't eligible to make this financial reports or audits required by the may be or may not have been a election. governmental unit. Also, describe any tax-exempt or non-exempt power or authority given to you by the organization. Line 3a. For purposes of this application, governmental unit. "bingo" is a game of chance played with cards that are generally printed with 5 For purposes of this question, a rows of 5 squares each on which "governmental unit" Includes a State, a participants place markers to form a possession of the United States, or any -10- Instructions for Form 1023 EFTA00812078 political subdivision of a State or a instructions for Part V, line 7a, for a Una 13d. A "relationship" between you possession of the United States, or the description of the term arm's length. and the recipient organization includes the United States, or the District of Columbia. Line 8. A "joint venture" is a legal following situations. A governmental unit would generally agreement in which the persons jointly • You control the recipient organization or not qualify for exemption under section undertake a transaction for mutual profit. it controls you through common officers, 501(c)(3). Also, if you can exercise certain Generally, each person contributes assets directors, or trustees, or through authority sovereign powers, such as the power to and shares risks. Like a partnership, joint to approve budgets or expenditures. tax or police powers, you would generally ventures can involve any type of business • You and the recipient organization were not qualify for exemption under section transaction and the persons involved can created at approximately the same time 501(c)(3). be individuals, groups of individuals, and by the same persons. companies, or corporations. • You and the recipient organization Line 6a. 'Economic development" operate in a coordinated manner with organizations are generally formed to Una 9a. Childcare services provide care combat community deterioration by respect to facilities, programs, employees, for children away from their homes. An or other activities. assisting businesses located in a organization providing childcare services particular geographic area whose • Persons who exercise substantial may qualify for tax-exempt status as either influence over you also exercise economy is economically depressed or a school under section 170(b)(1)(A)(ii) or substantial influence over the other deteriorating. Their varieties of activities childcare organization under section include grants, loans, provision of organization. 501(k). Refer to the instructions for Part information and expertise, or creation of VIII, line 19, to determine if you qualify as Una 14a. Answer "Yes" if you make industrial parks. Economic development a school. grants, loans, or other distributions (such organizations may also be formed to as goods) to a foreign organization. For A childcare organization qualifies under eliminate prejudice and discrimination or section 501(k) if it provides care for purposes of completing this application, a lessen the burdens of government through domestic organization is one that is children away from their homes, involvement with business development. substantially all of the childcare enables formed under the laws of the United If your exempt purpose is to combat States, its territories and possessions, individuals to be gainfully employed, and community deterioration, describe federally recognized Indian Tribal and the services provided by the organization whether the area or areas in which you will are available to the general public. Alaska Native governments (including operate have been declared blighted or political subdivisions), or the District of economically depressed by a government Una 9b. "Gainfully employed' includes Columbia. A "foreign organization" is one finding. If the area hasn't been declared enabling individuals to work or to seek that isn't a domestic organization. blighted or economically depressed, a work. A list of federally recognized Indian more suitable exemption may be under Line 9c. Section 501(k) states that to tribes is provided in Federal Register Doc. sections 501(c)(4) or 501(c)(6). See Pub. qualify as a childcare organization, 2016.01769 at htica:// 557 for more information. substantially all of the care you provide wmv.federalreoistergovidocuments/2017/ If your exempt purpose is to eliminate should be to permit individuals to be 01/17/2017-00912/Indian-entities- prejudice and discrimination, describe gainfully employed. If less than 85% of recognized-and-eligible-to-receive- how your activities further this purpose. your services are for children of working services-lrom-the-untted-states-bureau- parents or caretakers: cd-indian. A list of entities that are treated If your exempt purpose is to lessen the as political subdivisions of Indian tribal burdens of government, describe whether • Describe the percentage of the children for whom you provide services to permit governments is provided in Rev. Proc. the government has recognized your 86-17, 1986.1 C.B. 550 and Rev. Proc. activities as those for which it would parents or caretakers to work, and • Describe any efforts you are taking to 84-36, 1984-1 C.B. 510. otherwise be responsible, and any involvement you have with governmental increase the percentage of the children for Una 15. A "close connection" between entities that demonstrates that you are whom you provide services to permit you and another organization includes the actually lessening governmental burdens. parents or caretakers to work. following situations. Line 9d. Describe any eligibility • You control the organization or it Line 7a. 'Develop" means the planning, controls you through common officers, financing, construction, or provision of requirements, such as employment with a particular employer. directors, or trustees; or through authority similar services involved in the acquisition to approve budgets or expenditures. of real property, such as land or a building. Line 10. Intellectual property" includes • You and the organization were created For example, you should provide the following. at approximately the same time and by the information regarding the services of a • Patents (for inventions). same persons. For example, you were consultant who puts together an • Copyrights (for literary and artistic formed within months of the time that a arrangement for you to acquire a nursing works such as novels, poems, plays, films, social welfare organization and a political home through the issuance of tax-exempt musical works, drawings, paintings, action committee were established by the bonds. photographs, sculptures, architectural same persons who were instrumental in Line 7b. "Manage" means to direct or designs, performances, recordings, film, your formation. administer. For example, you would and radio or television programs). • You and the organization operate in a provide information about an organization • Trade names, trade marks, and service coordinated manner with respect to hired to administer a museum gift shop. marks (for symbols, names, images, and facilities, programs, employees, or other See the instructions for Part V, line 2a, for designs). activities. For example, you share rental a description of the term business or • Formulas, know-how, and trade expenses for office space and employees family relationships. secrets. with a for-profit corporation. Una 12a. A "foreign country" is a country • Persons who exercise substantial Line 7c. See the instructions for Part V, influence over you also exercise line 2a, for a description of the term other than the United States, its territories and possessions, and the District of substantial influence over the other business or family relationships. See the organization and (1) you either conduct Columbia. activities in common or (2) have a financial Instructions for Form 1023 -11- EFTA00812079 relationship. For example, a voting which normally maintains a regular faculty Travel, study, or other similar purposes member of your governing body is also a and curriculum and normally has a include payments made to enhance a voting member of the governing body of a regularly enrolled body of pupils or literary, artistic, musical, scientific, business league with which you intend to students in attendance at the place where teaching or other similar capacity, skill, or cooperate in planning an advertising its educational activities are regularly talent of the individual recipient. For campaign that will inform the public about carried on. A school may include a the example amounts paid to: the benefits of a particular program. For following. • Vocational high school students to be example, a voting member of your • Primary, secondary, preparatory, or used to purchase basic tools, governing body is also a voting member of high school. • Teachers to induce them to teach in an the governing body of a business league • College or university. economically depressed, public school that has made a loan to you. • Trade or technical school. system, and • Nursery or pre-school. • A scientific researcher to underwrite Line 16. A "cooperative hospital service organization" described in section 501(e) • School that you operate as an activity, that individual's research project. such as a school that is operated as an Educational grants don't include is organized and operated on a cooperative basis to provide its section activity of a museum, historical society, or amounts you pay to an individual as church. compensation, such as payments made to 501(c)(3) hospital members one or more of the following. If you are a nursery or pre-school that a consultant for personal services or to • Data processing. meets the description of a school, you produce a report for you. would answer "Yes" to line 19 and Educational grants don't include • Purchasing (including purchasing insurance on a group basis). complete Schedule B. You would also amounts paid to another organization that answer "No" to Part VIII, line 9a. distributes your funds as a scholarship to • Warehousing. • Billing and collection (including If you are a nursery or pre-school that an individual if you have no role in the purchasing patron accounts doesn't meet the description of a school, selection process. receivable on a recourse basis). you would answer "No" to line 19. You If you are a "private foundation" as • Food services. would answer "Yes" to Part VIII, line 9a, if described in Part X, you can request • Clinical. you are applying for exemption as a advance approval of your grant-making • Industrial engineering. childcare organization. procedures by completing Schedule H • Laboratory. See Pub. 557 for additional and avoid the possible imposition of • Printing. information. excise taxes under section 4945. • Communications. • Record center. Line 20. "Hospital or medical care" includes the treatment of any physical or Part IX. Financial Data • Personnel (including selecting, testing, training, and educating mental disability or condition, whether as A. Statement of Revenues and personnel) services. an inpatient or outpatient. A hospital includes the following. Expenses A cooperative hospital service • Hospitals and rehabilitation institutions. organization must also meet certain other Existed 5 years or more. If you have outpatient clinics, or community mental been in existence for 5 years or more, requirements specified in section 501(e). health or drug treatment centers if the For additional information, see Pub 557. complete the A. Statement of Revenues principal purpose or function is the and Expenses for your most recently Line 17. A cooperative service providing of medical or hospital care or completed year and each of the three organization of operating educational medical education or research. years immediately before it. Place organizations described in section 501(f) • Medical research organizations, if the financial information for your most recently is organized and operated to provide principal purpose or function is the completed year in the column marked investment services to its members. continuous active conduct of medical Current tax year. For the fifth year, enter Those members must be organizations research in conjunction with a hospital. the required information on a separate described in section 170(b)(1)(A)(ii) or (iv), See Pub. 557 for additional statement and attach it to Form 1023. The and either tax exempt under section information. information on the Statement ofRevenues 501(a) or whose income is excluded from and Expenses and on the separate taxation under section 115(a). Line 21. "Low-income housing" refers to rental or ownership housing provided to statement will contain a total of five years See Pub. 557 for additional persons based on financial need. "Elderly of financial information. information. housing" refers to rental or ownership We may request financial Line 18. A "charitable risk pool" housing provided to persons based on information for more than five described in section 501(n) is organized age, including retirement, assisted-living, years ifnecessary. and operated to pool insurable risks of its independent living, continuous care, and section 501(c)(3) members (other than life care arrangements. "Handicapped Existed more than one year, less risks related to medical malpractice). A housing" refers to rental or ownership than 5 years. If you have been in section 501(n) organization must be housing provided to persons based on existence for more than 1 year and less organized under state law provisions physical or mental disabilities, including than 5 years, provide your actual income authorizing risk pooling arrangements for nursing homes. and expenses for each completed year charitable organizations and also meet If you are a skilled nursing facility, you you have existed and projections of your certain other requirements provided by should also complete Schedule C. likely income and expenses based on a section 501(n). reasonable and good faith estimate of Line 22. Answer "Yes" if you pay money your future finances for your current year See Pub. 557 for additional to an individual as a scholarship, information. and each year you haven't existed for a fellowship, or educational loan, for travel, total of 4 years of financial information. Line 19. "A school" is an educational study, or other similar purposes. Also Place financial information for the year you organization whose primary function is the answer "Yes" if you pay such amounts on are filing this application in the column presentation of formal instruction and behalf of an individual to a school or a marked Current tax year. tuition or educational savings program. -12- Instructions for Form 1023 EFTA00812080 Existed less than 1year. If you have income is gross receipts received from a payment is called a grant, it is actually existed for less than 1 year, you must governmental unit In performance of the gross receipts that should be included on provide projections of your likely income orchestra's exempt function that should be line 9. The payment is by a governmental and expenses for your current year and listed on Line 9. unit (state) for a study for its own use, not projections of your likely income and for the direct benefit of the general public. expenses for the next 2 years based on a Line 2. Include amounts received from The study could have been done by a reasonable and good faith estimate of members to provide support to the for-profit consulting company rather than your future finances for a total of 3 years of organization. Don't include payments from by the tax-exempt conservation group. financial information. Place financial members or on behalf of members to Submit an Itemized list of payments by information for the year you are filing this purchase admissions, merchandise, any governmental units showing: application in the column marked Current services, or use of facilities. • Payer (governmental unit or bureau), tax year. Line 3. Include gross income from • Purpose of payment, and Preparing the statement. Prepare the dividends, interest, payments received on • Amount. statements using the method of securities, loans, rents, and royalties that Include as gross receipts the income accounting you use in keeping your books are held for investment purposes. from activity conducted: and records. If you use a method other Line 4. Net income from unrelated • Intermittently (not regularly carried on), than the cash receipts and disbursements business activities generally Includes such as an occasional auction. method, attach a statement explaining the income from any trade or business activity • With substantially all (at least 85%) method used. For example, state whether that is regularly carried on, not conducted volunteer labor, such as a car wash. you used the accrual method of with substantially all (at least 85%) • For the convenience of members, accounting to prepare the financial volunteer labor, and not related to your students, patients, officers, or employees, statements included with this application. exempt purposes. (This amount can be such as a parking lot for a school's Prepare the statements using the taken from Form 990-T, If filed.) students and employees. accounting period entered on Part I, line 5. • With substantially all contributed Report on line 9 Income from activities merchandise, such as a thrift store. Financial information should reflect that aren't related to the accomplishment projected activities reported elsewhere in of your exempt purposes, but aren't See Pub. 598 for additional information this application. considered unrelated business activities. regarding income that isn't from an Line 1. Include funds or other items of For example, income from the sale of unrelated trade or business. value that you receive as gifts, grants, or merchandise by volunteers that isn't Line 10. Add lines 8 and 9 and enter the contributions. For example, if one of your treated as an unrelated trade or business amount. activities is a food drive, the value of the is reported on line 9. donated food must be included on this Line 11. Attach a schedule with total See Pub. 598 for additional information amounts entered (rather than each line. Also include on this line payments a regarding unrelated business income. governmental unit makes to enable you to individual transaction) for each category both accomplish your exempt purpose(s) Line 5. Include the amount collected by using the format in Figure 2. and to provide a service or facility directly any local tax authority from the public on Line 12. "Unusual grants" generally are to the general public. your behalf. substantial contributions and bequests See the instructions to line 9 if you are Line 6. To determine the value of from disinterested persons that by their uncertain whether revenue should be services or facilities furnished by a size adversely affect classification as a included as a grant in line 1 or as gross governmental unit, use the fair market public charity. They are unusual, receipts in line 9. Unusual grants aren't value of the services or facilities furnished unexpected, and received from an included on this line, but are included on to you. Don't include the value of services unrelated party. line 12. or facilities generally provided to the public You must fully describe your unusual without charge. grants in Part X, line 7. For additional Examples Line 7. Enter the total income from all information about unusual grants and a 1. A city pays the symphony orchestra sources not reported on lines 1 through 6, description of public charity classification to provide free music programs in the or lines 9, 11, and 12. Submit an itemized see Pub. 557. public schools. The programs are open to list showing each type and amount of Line 13. Add lines 10 through 12 and the public. This income received from a income included. Also, briefly describe governmental unit accomplishes the enter the amount. each type of income. orchestra's exempt purpose and directly Line 14. Fundraising expenses include provides a service to the general public. Line 8. Add lines 1 through 7 and enter the total expenses incurred by you for The income is a grant to the symphony the amount. soliciting gifts, grants, and contributions orchestra that should be listed on line 1. Line 9. "Gross receipts" is income from included on line 1. Where you allocate a 2. The symphony orchestra sells activities that you conduct to further your portion of your other expenses to tickets to the public for its fall season. exempt purposes (excluding amounts fundraising, submit an itemized list Such Income is gross receipts received listed on other lines). It includes payments describing the amounts allocated. Include from the general public in performance of by a governmental unit that may be called fees paid to professional fundraisers for the orchestra's exempt function and a "grant," but that Is actually payment for a soliciting gifts, grants, and contributions. should be listed on line 9. service or facility for the use of the Line 15. If distributions have been made, 3. The public school system pays the government payer, rather than for the submit an Itemized list showing the name symphony orchestra to create several direct benefit of the public. of each recipient, a brief description of the musical pieces suitable for the school Example. The state government gives purposes or conditions of payment, and system's elementary music curriculum. a conservation group a grant to study the the amount paid. This payment by a governmental unit for consequences to an ecologically Colleges, universities, and other the music compositions is primarily for its significant woodland area of a new educational institutions and agencies (the school system's) own use, not for the sewage treatment plan. Although the subject to the Family Educational Rights direct benefit of the public. Therefore, this Instructions for Form 1023 -13- EFTA00812081 Figure 2. Part IX-A. Statement of Revenues and Expenses the counter, the statement should show Line 11. Net Gain or (Loss) the name of the corporation, a description of the stock and the principal exchange on which it is traded, the number of shares Categories held, and their value as carried on your (A) Real Estate (B) Securities (C) Other books and their fair market value. 1. Gross sales price of Line 6. Enter the total amount of loans assets (other than (personal and mortgage loans) receivable. inventory) by category. Submit an itemized list that shows each 2. Less: Cost or other borrower's name, purpose of loan, basis and sales repayment terms, interest rate, and expenses. original amount of loan. Report each loan 3. Gail or (loss). Subtract separately, even if more than one loan line 2 from line 1. was made to the same person. 4. Net gain or (foss) -Add line 3 of columns (A). (B). and (C). Enter here and Line 7. Enter the total book value of other on Form 1023, Pan IX -A Statement of Revenues and Expenses.Ire 11. investments. Include the total book value of government securities (federal, state, and municipal), and buildings and and Privacy Act (20 U.S.C. 1232g) need expense for which a separate line isn't equipment held for investment purposes. not list the names of individuals who were provided. Submit an itemized list identifying and provided scholarships or other financial reporting the book value of each building/ Line 24. Add lines 14 through 23 and item of equipment held for investment assistance where such disclosure would enter the amount on line 24. purposes. violate the privacy provisions of the law. Instead, such organizations should group B. Balance Sheet Line 8. Enter the total book value of each type of financial aid provided, Complete the following for your most buildings and equipment not held for indicate the number of individuals who recently completed tax year. If you haven't investment. This includes facilities you received the aid, and specify the completed a full tax year, use the most own and equipment you use in conducting aggregate dollar amount. current information available. Be sure to your exempt activities. Submit an itemized Line 16. If payments have been made, enter the year-end date for the information list of these assets held at the end of the submit an itemized list showing the name provided and not the date the form is current tax year/period, including the cost of each recipient, a brief description of the prepared. or other basis. purposes or condition of payment, and Line 1. Enter the total cash in checking Line 9. Enter the total book value of land amount paid. Don't include any amounts and savings accounts, temporary cash not held for investment. on line 15. investments (money market funds, CDs, Line 10. Enter the total book value of any Line 17. Enter the total amount of treasury bills, or other obligations that other category of assets not reported on compensation. Be consistent with mature in less than one year), and petty lines 1 through 9. For example, you would information provided in Part V, lines 1a, cash funds. include patents, copyrights, or other lb, and lc. Line 2. Enter the total accounts intangible assets. Submit an itemized list Line 18. Enter the total amount of receivable that arose from the sale of of each asset. employees' salaries and wages not goods and/or performance of services, Line 11. Add lines 1 through 10 and enter reported on line 17. less any reserve for bad debt. the amount. Line 19. Enter the total interest expense Line 3. Enter the amount of materials, Line 12. Enter the total amount of for the year, excluding mortgage interest goods, and supplies you purchased or accounts payable to suppliers and others, treated as an occupancy expense on manufactured and held to be sold or used such as salaries payable, accrued payroll line 20. in some future period. taxes, and interest payable. Line 20. Enter the amount paid for the Line 4. Enter the total amount of bonds or Line 13. Enter the total unpaid portion of use of office space or other facilities, heat, notes that you issued that will be repaid to grants and contributions you have light, power, and other utilities, outside you. Submit an itemized list that shows the committed to pay to other organizations or janitorial services, mortgage interest, real name of each borrower, a brief description individuals. estate taxes, and similar expenses. of the obligation, the rate of retum, the due date, and the amount due. Line 14. Enter the total of mortgages and Line 21. If you record depreciation, other notes payable outstanding at the depletion, and similar expenses, enter the Line 5. Enter the total fair market value end of the current tax year/period. Submit total amount. (FMV) of corporate stocks you hold. an itemized list that shows each note Submit an itemized list of your corporate separately, including the lender's name, Line 22. Professional fees are those stock holdings. For stock of closely held charged by individuals and entities that purpose of loan, repayment terms, interest corporations, the statement should show rate, and original amount. aren't your employees. They include fees the name of the corporation, a brief for professional fundraisers (other than summary of the corporation's capital Line 15. Enter the total amount of any fees listed on line 14, above), accounting structure, the number of shares held, and other liabilities not reported on lines 12 services, legal counsel, consulting their value as carried on your books. If through 14. Submit an itemized list of services, contract management, or any such valuation doesn't reflect current fair these liabilities, including the amounts independent contractors. market value, also include fair market owed. Line 23. Submit an itemized list showing value. Line 16. Add lines 12 through 15 and the type and amount of each significant For stock traded on an organized enter the amount. exchange or in substantial quantities over -14- Instructions for Form 1023 EFTA00812082 Line 17. Under fund accounting, an charitable, and religious purposes. Cooperative hospital service organization segregates its assets, 'Directly for the active conduct" means organizations described in section 501(e) liabilities, and net assets into separate that the distributions are used by the should also check this box, but don't funds according to restrictions on the use foundation itself to carry out the programs complete Schedule C. of certain assets. Each fund is like a for which it is organized and operated. Line Sd. Check this box if you are separate entity in that it has a Grants made to assist other organizations organized and operated to support self-balancing set of accounts showing or individuals are normally considered organizations described in lines Sa assets, liabilities, equity (fund balance), indirect. through 5c, 5f, 5h, or 5i, or an organization income, and expenses. If you don't use For additional Information about private that is tax exempt under section 501(c)(4), fund accounting, report only the "net operating foundations, go to Mel/ (5), or (6). If you select this box, complete assets" account balances, which include www.irs.gov/charities-non-profits/ and submit Schedule D. capital stock, paid-in capital, retained foundations/private-operating-foundation- The organization(s) you support should earnings or accumulated Income, and supbothtest have a significant influence over your endowment funds. Line 3. If you have existed for one year or operations. Line 18. Add lines 16 and 17 and enter more, you must provide financial Line 5e. Check this box if your primary the amount. information that demonstrates you meet purpose is to test products to determine Line 19. If you answer "Yes," describe the the requirements to be classified as a their acceptability for use by the general private operating foundation. change and explain what caused it. public. Line 4. If you have existed for less than Contributions to organizations of this Part X. Public Charity one year, you must ordinarily provide an type aren't deductible under section affidavit or opinion of counsel that sets Status forth facts conceming your operations and 170(c). Also, organizations that primarily test for specific manufacturers don't Line la. Organizations that are exempt projected support to demonstrate that you qualify for exemption under section 501(c) under section 501(c)(3) are private are likely to satisfy the requirements to be (3). foundations unless they are: classified as a private operating • Churches, schools, hospitals, foundation. If you haven't provided an Line 5f. Check this box if you are governmental units, entities that undertake affidavit or opinion of counsel, you may organized and operated exclusively to testing for public safety, organizations that provide a narrative statement that benefit a college or university owned or have broad financial support from the provides sufficient information to operated by a governmental unit. You general public; or demonstrate that you are likely to satisfy must also normally receive a substantial • Organizations that support one or more the requirements to be classified as a part of your support from a govemmental other organization(s) that are themselves private operating foundation. unit or from contributions from the general classified as public charities. public. Line 5a. Check this box if your primary Section 501(c)(3) organizations purpose is operating a church or a Organizations that qualify under this excepted from private foundation status convention or association of churches. category would generally also qualify are public charities. See the instructions The term "church" includes mosques, under section 509(a)(3), line 5d, which for Part X, lines Sa through 5j for a more temples, synagogues, etc. If you select would be an easier public charity status to detailed description of public charities. this box, complete and submit maintain. Unless you meet one of the exceptions Schedule A. Line 5g. Check the box if you are an above, you are a private foundation and Line 5b. Check this box if your primary agricultural research organization must answer, "Yes," on line la. purpose is operating a school. If you described in section 170(b)(1)(A)(ix) select this box, complete and submit operated in conjunction with a land grant Line lb. Section 508(e) provides that a college or university or a non-land grant private foundation isn't tax exempt unless Schedule B. college of agriculture. its organizing document contains specific If you operate a school but it isn't your provisions. These specific provisions primary purpose, don't check this box. Attach to your application additional require that you operate to avoid liability However, you must still complete and information detailing your agricultural for excise taxes under sections 4941(d), submit Schedule B. research program and how contributions 4942, 4943(c), 4944, and 4945(d). You to such program will be spent. This Be sure your response is consistent information should include the following. can also meet these provisions by reliance with Part VIII, line 19. on state law. • A description of how you are engaged Line 5c. Check this box if your primary in the continuous active conduct of See Pub. 557, Chapter 3, Section agricultural research (as defined in section 501(c)(3) Organizations, Private purpose is providing medical or hospital care, or medical education or research 1404 of the Agricultural Research, Foundations and Public Charities, Extension, and Teaching Policy Act of Governing instrument for samples of (performed in association with a hospital). If you select this box, complete and submit 1977). provisions that will meet section 508(e). • Information showing that you are Also, see Appendix B for a list of states Schedule C. operated in conjunction with a land grant that have enacted statutory provisions that A hospital includes a rehabilitation institution, outpatient clinic, community college or university or a non-land grant satisfy the requirements of section 508(e), college of agriculture (as defined in subject to notations. Appendix B is based mental health clinic, drug treatment center, or skilled nursing facility. section 1404 of the Agricultural Research, on Rev. Rul. 75-38, 1975-1 C.B. 161. Extension, and Teaching Policy Act of Line 2. Some private foundations are A hospital doesn't include 1977). private operating foundations. These are convalescent homes, homes for children • Information discussing the timing of types of private foundations that lack or the aged, or institutions whose principal when you will spend contributions for general public support, but make purpose or function is to train research. qualifying distributions directly for the handicapped individuals to pursue some vocation. Line 5h. Check this box if you normally active conduct of their educational, receive a substantial part of your support Instructions for Form 1023 -15- EFTA00812083 from grants from governmental units or Sh or 5i. By checking this box, you agree 2. An officer, director, trustee, or any from contributions from the general public, to let us choose the best public charity other individual who has similar powers or or a combination of these sources. status for you. responsibilities. Typically, a substantial part of your income 3. An individual who owns more than Line 6. Confirmation of public support would be shown on Part IX-A. Statement status. If you have been in existence for 20% of the total combined voting power of ofRevenues and Expenses, lines 1 and 2. a corporation that is a substantial more than 5 years, and you checked Under this public charity status, you box 5h, Si, or 5j; then you must confirm contributor. must meet the one-third public support your public support status. 4. An individual who owns more than test or the 10% facts and circumstances 20% of the profits interest of a partnership This determination must be based on test. your public support computed on the cash that is a substantial contributor. Public support test An organization method of accounting. Therefore, If you 5. An individual who owns more than must receive either (1) at least one-third of use the accrual method of accounting, 20% of the beneficial interest of a trust or its total support from governmental please use a worksheet to convert your estate that is a substantial contributor. agencies, contributions from the general revenue accounts from the accrual to the 6. A member of the family of any public, and contributions or grants from cash basis. Such a worksheet is provided individual described In 1, 2, 3, 4, or 5 other public charities; or (2) at least 10% in Instructions for Schedule A (Form 990 above. of its total support from governmental or 990-EZ), Public Charity Status and agencies, contributions from the general Public Support, Part IV. Supporting 7. A corporation in which any public, and contributions or grants from Organizations, Section A. All Supporting individuals described In 1, 2, 3, 4, 5, or 6 other public charities and also satisfy a Organizations. above, hold more than 35% of the total facts and circumstances test. combined voting power. To show that you meet one of the required public charity support tests, 8. A trust or estate in which any Facts and circumstances test. Facts individuals described In 1, 2, 3, 4, 5, or 6 and circumstances include (1) the amount complete lines 6a and/or fib. above, hold more than 35% of the of support you received from the general Line WI). From Part IX-A. Statement beneficial interests. public, governmental units, or public of Revenues and Expenses, add the line 8 charities; (2) whether you have a 9. A partnership in which any amounts from completed tax years only. individuals described In 1, 2, 3, 4, 5, or 6 continuous and bona fide program for Multiply the total by 2% (0.02) and enter solicitation of funds from the general above, hold more than 35% of the profits the amount in the space provided. interest. public, governmental units, or public charities; and (3) all other facts and Line 6.9(10. Attach a list showing the Substantial contributor. A circumstances, including the public nature name and amount contributed by each 'substantial contributor is any individual of your governing board, the extent to person, company, or organization whose or organization that gave more than which your facilities or programs are gifts totaled more than the 2% amount. If $5,000 to you from the date you were publicly available, the extent to which your no gifts totaled more than the 2% amount, formed or other date that your exemption dues encourage membership, and state this on an attachment. would be effective, to the end of the year whether your activities are likely to appeal Line 6b(l). For each year amounts are in which the contributions were received. to persons having a broad common included in lines 1, 2, and 9 of Part IX-A, This total amount contributed must also be interest or purpose. For additional attach a list showing the name and more than 2% of all the contributions you information about the 10% facts and amount received from each disqualified received. A creator of a trust is treated as circumstances test, see Pub. 557 and person. If no such amounts are included a substantial contributor regardless of the Reg. section 1.170A-9(e)(3). on lines 1, 2, and 9 of Part IX-A, state this amount contributed. Line 51 Check this box if you normally on an attachment. For more information regarding receive more than one-third of your substantial contributors, go to IRS.gov/ Line 6b(ll). The required list for this support from contributions, membership line should include the name of and SubstantialContributor. fees, and gross receipts from activities amounts paid by each individual or Family members. A "member of the related to your exempt functions, or a organization included on line 9, Part IX-A. combination of these sources, and not family- includes the spouse, ancestors, Statement of Revenues and Expenses, children, grandchildren, more than one-third of your support from that were greater than the larger of 1% of great-grandchildren, and their spouses. gross Investment income and net line 10, of the Part IX-A. Statement of unrelated business income. Typically, a For additional information concerning Revenues and Expenses or $5,000 for members of the family, go to IRS.00v/ substantial part of your income would be any completed tax year. Your list for each shown on Part IX-A. Statement of FamilvMembers. payer must show a year-by-year Revenues and Expenses, lines 1, 2, and Further information about disqualified breakdown of the amounts reported for 9. completed tax years on Part IX-A. persons, can be obtained at IRS.gov/ Under this public charity status, you Statement of Revenues and Expenses, DisgualibedPerson. must meet both the "one-third public line 9. If no such payments were made, Line 7. "Unusual grants" generally are support test" and the state this on an attachment. substantial contributions and bequests "not-more-than-one-third Investment from disinterested persons that by reason income and net unrelated business Don't include disqualifiedpersons of their size adversely affect classification income test". Before checking this box, consider the types of income you listed on A in this list. Disqualified persons should be listedin line 66(i). as a public charity. They are unusual, unexpected, and received from an Part IX-A. Statement of Revenues and For purposes of this application, a unrelated party. If you answer "Yes" to Expenses, lines 1 through 13. See Pub. "disqualified person" is any Individual or line 7, submit a statement for each grant. 557 for additional Information about these organization that is any of the following. The statement should Include the name of tests. the contributor, the date and amount of the 1. A 'substantial contributor to you Line 5j. Check this box if you are unsure (defined below). grant, a brief description of the grant, and whether you are better described in boxes an explanation of why it is unusual. You -16- Instructions for Form 1023 EFTA00812084 should include details of any additions illegal or contrary to clearly defined public You may request classification as funds you expect to receive from the policy. a church at a later date after you contributors listed. If they qualify for establish a congregation or other unusual grant treatment, these amounts Specific Line Items religious membership group. For should be reported on Part IX-A. information about this option, contact our Statement of Revenues and Expenses, Line la. Provide a copy of your written customer account service representatives line 12. creed, statement of faith, or summary of at 877-829-5500 (toll-free). See Pub. 557 for additional information beliefs. about unusual grants. Line 7. Enter the total number of your Line lb. A lorm of worship" refers to current members in the provided. If you religious practices that express your have no members, enter zero. Part XI. User Fee devotion to your creed, faith, or beliefs. Information Line 8a. Answer "Yes" if you have a Line 2a. A "code of doctrine and prescribed way to become a member. Your application willnot be discipline" refers to a body of laws or rules Answer "Yes" even if you just keep processed without payment of the that govern behavior. records of who is currently a member. Ak proper user fee. Line 2b. Your "religious history' includes Describe any actions required for the story of your establishment and major individuals to become members. Submit Your user fee may be paid by a copies of any application forms used. personal or certified check, bank check, or events in your past. cashiers check. Your check should be Line 2c. Your literature includes any Line 8b. Describe any rights and benefits made payable to the United States writings about your beliefs, rules, or of members. You should include details of Treasury. For the current user fee history. any levels of membership and the rights amounts, go to www.irs.govicharities-non- and/or benefits associated with each level. prolits/form-1023-amount-of-user-fee. You Line 3. A `religious hierarchy or ecclesiastical government" refers to Line 8c. If your members may be can also call 877-829-5500. associated with another denomination or people or institutions that exercise significant influence or authority over you. church, describe the circumstances in Schedule A. Churches which your members would be members Line 4a. Indicate the regular days and of your church and another church. There is no single definition of the word times of your religious services. Describe `church' for tax purposes. When the order of events during your regular Line 8d. See Glossary, Appendix C, for a determining whether a section 501(c)(3) worship service and explain how the description of the word "family." religious organization is also a church, we activities conducted as part of your will consider characteristics generally Line 9. Answer "Yes" if you conduct services further your religious purposes. baptisms, weddings, funerals, or other attributed to churches and the facts and Also include sample copies of church circumstances of each organization religious rites. bulletins, pamphlets, or flyers that are applying for public charity status as a distributed to your members or the general Line 10. A school for the religious church. public. instruction of the young refers to any The characteristics generally attributed to regularly scheduled religious, educational Line 4b. Enter on the space provided, the activities for youth, such as 'Sunday churches are as follows. average number of members and • A distinct legal existence. school." non-members who attend your regularly • A recognized creed and form of scheduled religious services. Line 11a. A "prescribed course of study" worship. refers to formal or informal training. It • A definite and distinct ecclesiastical Line 5a. An "established place of doesn't include self-ordination or paying a government. worship" is a place where you hold fee for an ordination certificate without • A formal code of doctrine and regularly scheduled religious services. It completing a course of study. Describe discipline. may be a place that you own, rent, or the course of study completed by your • A distinct religious history. which is provided freely for your use. If you religious leader. • A membership not associated with any answer "Yes," go to line 5b. If you answer other church or denomination. -Nor describe where you meet to hold Line 12. Answer "Yes" if your religious • Ordained ministers ministering to the regularly scheduled religious services. leader is listed in Part V, line la. congregation. Line 6. An "established congregation' or Line 14. Answer "Yes" if you are part of a • Ordained ministers selected after other religious membership group' group of churches with similar beliefs and completing prescribed courses of study. includes individuals who regularly attend structures, such as a convention, • A literature of its own. and take part in the religious services of association, or union of churches. • Established places of worship. your organization at an established • Regular congregations. Line 16. If you answer "Yes," submit a location. An established congregation copy of your church charter. Identify the • Regular religious services. generally doesn't include members of only • Sunday schools for the religious organization that issued the charter and one family. If you answer "No" because describe the requirements you met to instruction of the young. you don't have an established • Schools for the preparation of ministers. receive it. Don't describe organizational congregation or other religious charters you received from your state's Although it isn't necessary that each of the membership, you may be a religious Secretary of State, Franchise Tax Board, above criteria be met, a congregation or organization that doesn't qualify as a or similar administrative office. other religious membership group is church. If you don't qualify as a church, generally required. A church includes you will need to go back to Part X, line 5, Line 17. Attach any additional information mosques, temples, synagogues, and to reconsider your public charity status. you would like us to consider that would other forms of religious organizations. For help us classify you as a church. more information, see Pub. 1828. The practices and rituals associated with your religious beliefs or creed must not be -17- EFTA00812085 Schedule B. Schools, 'Yes," don't complete the remainder of The M school admits students Schedule B. Colleges, and Universities of any race, color, national Line 2b. Answer "Yes" if you have a origin, and ethnic origin to all the An organization is a school if it: signed contract or agreement with a state rights, privileges, programs, and • Presents formal instruction as its or local government under which you activities generally accorded or primary function. operate and receive funding. Submit a • Has a regularly scheduled curriculum. made available to students at signed and dated copy of your contract or the school. It doesn't • Has a regular faculty of qualified agreement. If you answer 'Yes," don't teachers. discriminate on the basis of complete the remainder of Schedule B. • Has a regularly enrolled student body. race, color, national origin, and • Has a place where educational Line 3. Enter the name of the public ethnic origin in administration of activities are regularly carried on. school district and county where you its educationalpolicies, operate. admission policies, scholarship The term "schoor includes primary, secondary, preparatory, high schools, Line 4. Answer -Yes" if you were formed andloan programs, and athletic colleges, and universities. It doesn't or substantially expanded during a period and other school-administered include organizations engaged in both of time when public schools in your district programs. educational and non-educational or county were desegregated by court activities, unless the latter are merely order. incidental to the educations activities. If you are unsure whether to Every private school is subject to the Non-traditional schools such as an outdoor survival school or a yoga school may qualify. A answer "Yes," contact an appropriate public school official. provisions of Revenue Procedure 75-50, 1975.2 C.B. 587. See Pub. 557, which sets forth the requirements of Rev. Proc. The term "schoor doesn't include Line 5. Answer -Yes" if a state or federal 75-50 under the section for Private home schools. administrative agency or judicial body ever Schools. determined your organization to be racially Section I. Operational Information discriminatory. Identify the parties involved A private school must also certify and the forum in which the case was annually that it meets the requirements of Line la. Answer "Yes" if you have a presented. Explain the reason for the Rev. Proc. 75-50. This can be regularly scheduled curriculum, a regular action, the decision reached, and provide accomplished by filing Schedule A (Form faculty of qualified teachers, a regularly legal citations (if any) for the decision. 990, Form 990-EZ) Organization Exempt enrolled student body, and facilities where Also, explain in detail any changes made Under Section 501(c)(3). your educations activities are regularly in response to the action against your carried on. Submit evidence establishing organization or the decision reached. Schools that don't file Form 990 or that you meet these factors, as described 990-EZ must file Form 5578, Annual below. Line 7. In responding to this line, you may Certification of Racial Nondiscrimination • Evidence that you have a regularly reference information previously provided for a Private School Exempt From Federal in response to Part VIII, lines 7a, 7b, or 7c, Income Tax. scheduled curriculum includes a list of required courses of study, dates and times along with any additional information to fully respond. Line 1. Answer 'Yes" if your organizing courses are offered, and other information document or bylaws contain a about how to complete required courses. Line 8. Answer 'Yes" if you manage or nondiscriminatory statement as to • Evidence that you have a regular faculty intend to manage your programs through students similar to the one shown above. of qualified teachers includes certifications your own employees or by using by the appropriate state authority or volunteers. Answer "No" if you engage or Answer "No" if the nondiscrimination successful completion of required training. intend to engage a separate organization statement isn't included. If the statement • Evidence of a regularly enrolled student or independent contractor. Make sure your isn't included in your organizing document body includes records of regular answer is consistent with the information or bylaws, you may submit a copy of your attendance by students at your facility. provided in Part VIII, line 7b. In responding signed and dated resolution that was • Evidence of a place where your to this line, you may reference information adopted according to your internal rules or exclusively educational activities are previously provided in response to Part regulations. Your resolution should regularly carried on includes a lease VIII, line 7a, 7b, or 7c, along with any approve a nondiscriminatory policy similar agreement or deed for your facility. additional information to fully respond. to the one shown above. If you answer "No," don't complete Line 2. Answer -Yes" if your brochures, Schedule B. You don't meet the Section II. Establishment of application forms, advertisements, and requirements of a school and you will Racially Nondiscriminatory Policy catalogues dealing with student need to go back to Part X, line 5, to admissions, programs, and scholarships reconsider your public charity status. A section 501(c)(3) organization that is a contain a statement similar to the school must publish a notice of its racially following. Line lb. Answer "Yes" if your primary nondiscriminatory policy as to students as function is the presentation of formal follows. The M school admits students of any instruction. If you answer "No," don't race, color, andnational or ethnic complete Schedule B. You don't meet the origin. requirements of a school and you will need to go back to Part X, line 5, to reconsider your public charity status. Submit representative copies of each Line 2a. Answer "Yes" if you are a public document. school. Submit documentation of your If you answer "No," to line 2, but status as a public school. If you answer checked the box on line 2b, you are agreeing that all future printed materials, including Internet content, will contain a -18- EFTA00812086 statement of nondiscriminatory policy as objective to keep public or private school conjunction with a hospital. The hospital to students similar to the one provided education segregated by race. Explain with which the organization is affiliated above. how these individuals or organizations must be described in section 501(c)(3), a promote segregation in public or private federal hospital, or an instrumentality of a Line 3. You must demonstrate that you have made your nondiscriminatory policy schools. governmental unit, such as a municipal hospital. known to all segments of the general Line 8. Answer "Yes" if on a continuing community served by the school. One way basis, you will maintain fora minimum "Medical research' means of meeting this requirement is to publish period of three years the following investigations, experiments, and studies the school's nondiscriminatory policy records. to discover, develop, or verify knowledge annually. If you have already published • Your racial composition (similar to the relating to the causes, diagnosis, your notice, submit the actual page of the information requested in Schedule B, treatment, prevention, or control of human newspaper on which the notice appears. Section II, line 5). physical or mental diseases and We can't accept a photocopy, other • Evidence that your scholarships and impairments. For more Information, see electronic reproduction, or partial page of loans are awarded on a racially Reg. section 1.170A-9(c)(2). the newspaper. nondiscriminatory basis (similar to the If you are a hospital, check the first box Answer "No," if you haven't attached information requested in Schedule B, on Schedule C and complete Section I. your notice and describe how you meet Section II, line 6). If you are a medical research the publicity requirement of Rev. Proc. • Copies of all materials used by you or organization, check the second box on 75-50. on your behalf to solicit contributions. Schedule C and complete Section II. • Copies of brochures, application forms, See Pub. 557 or Rev. Proc. 75-50 for advertisements, and catalogues dealing guidance on the format and content of the with student admissions, programs, and Section I. Hospitals required notice and whether any financial aid. exceptions may apply to you. Line 1. Answer -Yes" if all doctors in your Answer "No" if you don't maintain community are eligible for staff privileges A notice published in the legal records and explain how you meet the at your facility. You may answer "Yes" if notices section or c.lassified recordkeeping requirements under Rev. staff privileges at your facility are limited advertisements of your local Proc. 75-50. by capacity. newspaper is generally not acceptable. Failure to maintain these records Answer "No" if all doctors in your Line 5. Enter the racial composition of your student body, faculty, and A or produce them upon the proper request will create a presumption that you haven't complied with the community aren't eligible for staff privileges at your facility. administrative staff in the spaces If you answer "No," describe in detail provided. Enter actual numbers, rather requirements of Rev. Proc. 75-50. how you limit eligibility for staff privileges than percentages, for the current year and at your facility. Include details of your projected numbers for the next academic Schedule C. Hospitals and eligibility criteria and selection procedures year. If the number is zero, then enter "0: Medical Research for your courtesy staff of doctors. Don't identify students, faculty, Organizations Line 2a. Answer "Yes" if you admit all A and staff by name. An organization qualifies as a hospital if it is one of the following. patients in your community who can pay for themselves or through private health insurance. If you are completing the table based • Hospital. on estimates, submit documentation that • Cooperative hospital service Answer "No" if you limit admission for supports how you arrived at the estimated organization (Schedule C not required). these Individuals in any way. If you answer numbers. For example, if your estimates • Medical research organization operated "No," describe your admission policy in are based on the racial composition of the in conjunction with a hospital. detail. You should explain how and why community in which you operate, submit you restrict patient admission. current census data of the racial Hospital. An organization is a "hospital' if its principal purpose or function is Line 2b. Answer "Yes" if you admit all composition for the area. If your numbers patients in your community who and the census numbers differ greatly, providing medical or hospital care or medical education or research. Medical participate in Medicare. explain why. care includes treatment of any physical or Answer "No" if you limit admission in Line 6. Enter the racial composition of mental disability or condition, on an any way for these Individuals. If you students to whom you award loans and inpatient or outpatient basis. Thus, if an answer "No," describe your admission scholarships in the spaces provided. Enter organization is a rehabilitation institution, policy in detail. You should explain how actual numbers, rather than percentages, outpatient clinic, or community mental and why you restrict patient admission to for the current year and projected health or drug treatment center, it is a exclude persons who participate in numbers for the next academic year. If the hospital if its principal function is providing Medicare. number is zero, then enter "0: treatment services as described above. Line 2c. Answer "Yes if you admit all Don't identify students by name. A hospital doesn't include patients in your community who A convalescent homes, homes for children or the aged, or institutions whose principal participate in Medicaid. Answer "No" if you limit admission in Line 7a. Submit a list that identifies each purpose or function is to train any way for these individuals. If you individual or organization by name. Your handicapped individuals to pursue a answer "No," describe your admission list must Include your incorporators, vocation. policy in detail. You should explain how founders, board members, donors of land, Medical research organization. An and why you restrict patient admission to and donors of buildings. organization is a "medical research exclude persons who participate in Line 7b. Answer "Yes" if any individuals organization' if its principal purpose or Medicaid. or organizations on your list have an function is the direct, continuous, and active conduct of medical research in -19- EFTA00812087 Line 3a. Answer "Yes" if you require a distinguishes charity care patient Line 10. Answer 'Yes" If you manage or deposit from Medicare and/or Medicaid expenditures from uncollected bad debts. intend to manage your programs through patients before admission. If you answer Line 5d. Submit copies of any written your own employees or by using "Yes," describe in detail how you agreements you have with municipalities volunteers. Answer "No" if you engage or determined the amount required and or government agencies to subsidize the intend to engage a separate organization explain why a deposit is needed. cost of admitting or treating charity or independent contractor. Make sure your patients. answer is consistent with the information Line 3b. Answer "Yes" if you require a deposit for other patients before provided in Part VIII, line 7b. Line 5e. A sliding fee scale establishes admission and the requirement is the payments depending on financial ability to Line 11. Recruitment incentives may be same as for Medicare and/or Medicaid pay. offered to attract or retain physicians as patients. employees or to serve the community in Line Sa. Answer "Yes" If you have a which the hospital is located. Such Answer "No" If you require a deposit, formal program of medical training and but deposits for Medicare/Medicaid incentives are generally offered when research. If you answer "Yes," describe there is an acute shortage of such patients and other patients differ as to: (1) your program in detail, including its length the way the amount is determined, or (2) physicians in your hospital or within the and criteria for acceptance Into your community. the reason for the deposit. If you answer program. 'No," describe the differences in detail. Line 12. Physicians who have a financial Line 6b. Answer "Yes" if you have a or professional relationship with you Line 4a. Answer "Yes" if you offer formal program of community educational emergency medical or hospital care at include physicians with whom you have a programs. If you answer "Yes," describe business relationship, such as employees, your facility on a 24-hour basis, seven your program in detail. days a week. If "No," explain why you staff physicians, participants in joint don't offer an emergency room. For Line 7. Answer "Yes" if you provide office ventures, or physicians with whom you example, emergency care may be space to physicians conducting their own contract for services. inappropriate for the type of services you medical practices. Line 13. A business relationship includes provide. Also, describe any emergency Line 8. Answer "Yes" if you have a board employment, contractual relationship, or services that you provide. of directors that is representative of the status as a member of your board of Line 4b. Answer "Yes" if you have a community you serve. Include a list of directors. specific written plan or policy to accept all each board member with the individual's Line 14. Answer -Yes" if you have patients in need of emergency care name and employment affiliation. Also, for adopted a conflict of interest policy without considering their ability to pay. each board member, describe how that consistent with the sample conflict of If you answer "Yes," submit a copy of individual represents the community. interest policy provided in these your plan or policy. Generally, hospital employees and staff instructions or you are subject to similar physicians aren't individuals considered to conflict of interest policies under state law. Line 4c. Answer -Yes" if you have be community representatives. Provide copies of the policies to which you specific arrangements with any police, fire, are subject. Although a conflict of interest or ambulance service providers to bring Answer "Yes"if an organization described in section 501(c)(3) policy isn't required as a matter of tax law, emergency cases to your facility. we encourage adoption of a substantive with a community board exercises If you answer "Yes," describe each rights or powers over you, such as the conflict of interest policy because it makes specific agreement. For written right to appoint members to your it more likely that you will operate for the agreements, you may submit a copy of governing board of directors and the benefit of the community and not for each agreement. If it is oral, explain fully power to approve certain transactions. private interests. This sample conflict of the agreement. For any oral agreements, Describe these rights andpowers. In interest policy doesn't prescribe any include details of how and when the addition, describe how each of that specific requirements. Therefore, agreement was arranged. organization's board of directors organizations should use a conflict of Line 5a. Answer "Yes" if you provide free represents the community. interest policy that best fits their or low cost medical or hospital care organization. Answer "Yes" If you are subject to a An example of a substantive conflict of services to the poor. If you answer "Yes," answer lines 5b through 5e. Don't answer state corporate practice of medicine law interest policy is available in Appendix A in lines 5b through 5e if you answer -No." that requires your governing board to be these instructions. The sample conflict of composed solely of physicians licensed to interest policy does not prescribe any Line 5b. Submit a copy of your written practice medicine In the state. If you specific requirements. Therefore, policy or explain fully the understanding answer "Yes" on this basis, also provide organizations should use a conflict of under which you operate regarding the the following Information. interest policy that best fits their admission and/or treatment of charity • Describe whether a hospital described organization. cases. Explain how you distinguish in section 501(c)(3) exercises any rights or between charity care and bad debts. powers over you. Answer "No" If you haven't adopted a • Identify the corporate practice of conflict of interest policy or you aren't Include details ofhow you inform subject to conflict of interest policies under the generalpublic about your medicine law under which you operate. • Explain how the section 501(c)(3) state law. policy. Submit copies of any documents or agreements you require hospital exercises any rights or powers charity patients to sign before being over you, such as the right to appoint Section II. Medical Research admitted and/or treated. members to your governing board of Organizations directors and the right to approve certain Line 5c. Submit information that shows transactions. Line 1. Attach a list of hospitals with the amounts you spend for treating charity • Explain what services you provide to which you have relationships relating to care patients and the types of services the section 501(c)(3) hospital. the conduct of medical research. Describe you provide. Include an explanation that in detail the relationship you have with -20- Instructions for Form 1023 EFTA00812088 each hospital. Submit copies of any public support test, submit the amounts Line 2. Answer 'Yes" if your governing written agreements. and sources of revenue for the last four document, bylaws, or other internal rules Line 2. Describe in detail all activities that completed tax years for the supported and regulations show that a majority of organization(s). You should provide the your governing board consists of directly accomplish your conduct of medical research. requested financial data in the format individuals who also serve on the shown on Part IX-A. Statement of governing board of the supported Making grants to other organizations Revenues and Expenses, for each organization(s). Then, go to Section III. doesn't directly accomplish the conduct of supported organization. You must then medical research. submit the lists requested by Part X, Answer "No" if your governing line 6b(ii), which is applicable to the public document, bylaws, or other internal rules Line 3. Your schedule should explain and regulations don't show that a majority how you determine the fair market value of support test under section 509(a)(2). of your governing board consists of your assets. Answer "No" if no supported individuals who also serve on the organization listed in line 1 has been governing board of the supported Schedule D. Section recognized as tax-exempt under section organization(s). If you answer -No" but still 501(c)(4), (5), or (6). believe you satisfy this test, explain and 509(a)(3) Supporting If any organization you intend to go to Section III. Otherwise, go to line 3 Organizations support hasn't received a letter because you don't meet the "supervised A section 509(a)(3) organization is from us recognizing it as a public or controlled in connection with" charity under section 509(a)(1) or 509(a) relationship test. commonly referred to as a "supporting organization." An organization that a (2), or hasn't received a determination Line 3. Answer 'Yes" if you are a supporting organization benefits is recognizing that it is tax-exempt under charitable trust under state law, you name commonly referred to as a "supported section 501(c)(4), (5), or (6), you must each specified publicly supported organization." A supporting organization demonstrate, in writing, that each organization as a beneficiary in your trust may support more than one supported organization you support is describedin agreement, and each beneficiary organization. section 509(a)(1) or 509(a)(2). For organization has the power to enforce the example, if you support a church or trust and compel an accounting under An organization qualifies for public charity foreign organization, you should describe state law. Then go to Section II, line 5. status as a supporting organization under how this organization qualifies as a public section 509(a)(3) if: charity under section 509(a)(1) or 509(a) Line 4a. Answer "Yes" if the officers, • It is organized and at all times thereafter (2). directors, trustees, or members of the is operated exclusively for the benefit of, supported organization(s) elect or appoint to perform the functions of, or to carry out any of your officers, directors, or trustees. the purposes of one or more public Section II. Relationship with If your governing document, bylaws, or charities described in section 509(a)(1) or Supported Organization(s) - Three other internal rules and regulations don't 509(a)(2); provide for this, explain how your officers, Tests directors, or trustees are elected or • It meets one of three required relationship tests with the supported To qualify under section 509(a)(3), you appointed. Then go to line 4d. organization(s); and must show that you meet one of three relationship tests with the supported Line 4b. Answer "Yes" if any members of • It isn't controlled directly or indirectly by the governing body of the supported 'disqualified persons' See specific organization(s); • Test I. Operated, supervised, or organization(s) also serve as your officers, instructions for Part X, line 6b(ii), for a directors, trustees, or hold another definition of a "disqualified persons." controlled by (comparable to a important office for your organization. parent-subsidiary relationship); A supporting organization can also • Test 2. Supervised or controlled in Describe the position held and whether support the charitable purposes of connection with (comparable to a the position is ongoing. Then go to line 4d. organizations that are exempt under brother-sister relationship); or Line 4c. Answer "Yes" if your officers, sections 501(c)(4), (5), or (6). • Test 3. Operated in connection with directors, or trustees maintain a close and (responsive to the needs or demands of, continuous working relationship with the Section 1. Identifying Information and having significant involvement in the officers, directors, or trustees of the affairs of, the supported organization(s)). supported organization(s). Explain the About Supported Organization(s) continuous relationship in detail. Then go Line 1. Answer 'Yes" if your governing Line 1. Enter the name, address, and EIN to line 4d. document, bylaws, or other internal rules of each organization you support. and regulations show that the majority of If you answer tlo,"on line 4c and Line 2. Answer Yes" if each supported your governing board or officers is elected your answers to lines 3, 4a, and organization has received a letter from the or appointed by the supported 4b were "No," you don't meet the IRS recognizing it as a public charity under organization(s). Then, go to Section III. "operatedin connection with"relationship section 509(a)(1) or 509(a)(2). Then, go to Answer "No" if your governing test. You must establish a different Section II, line 1. document, bylaws, or other internal rules relationship with the supported and regulations don't show that the organization or go back to Part X to Answer "No" if any supported reconsider your public charity status. organization hasn't received a letter from majority of your governing board or us recognizing it as a public charity under officers is elected or appointed by the supported organization(s). If you answer Line 4d. Answer "Yes" if the supported section 509(a)(1) or 509(a)(2). Then, go to organization has a significant involvement line 3. "No" but still believe you satisfy this test, explain and go to Section III. Otherwise, in your investment policies, making and Line 3. Answer 'Yes" if any supported go to line 2 because you don't meet the timing of grants, and directing the use of organization you listed in line 1 received a -operated, supervised, or controlled by" your income and assets. Explain how the letter from us stating that it is exempt relationship test. supported organization is involved in under section 501(c)(4), (5), or (6). Also, these matters. to show how the organization meets the -21- EFTA00812089 Line 5. An applicant for tax exemption as organizing document unless there has • An individual having powers or a supporting organization under the been an historic and continuing responsibilities similar to those of your -operated In connection with relationship relationship between you and the officers, directors, or trustees. must satisfy either the integral part test or supported organization(s). Line lb. See the instructions for Part V, the alternative integral part test. If you are Line 7b. An historic and continuing line 2a, for a description of the terms requesting supporting organization status relationship depends on all the facts and -family or business relationship." by meeting the "operated in connection circumstances that would demonstrate a Schedule E. Organizations with" relationship, you must satisfy either substantial identity of interests between the integral part test or the alternative you and the supported organization. Not Filing Form 1023 integral part test. If you satisfy the integral If you answer "No" to lines 7a and 7b. Within 27 Months of part test described in line 5, then you don't have to complete line 6. you may consider amending your Formation organizing document to specify the Answer "Yes" If you conduct activities supported organization(s) by name so you The questions in this schedule will help us that the supported organization would can answer "Yes" to line 7a. Otherwise, determine the effective date of exemption otherwise conduct. Describe the activities you will need to go back to Part X to for an organization that filed its application that you conduct, other than distributing reconsider your public charity status. more than 27 months after the end of the funds. Then go to Section III. month in which it was legally formed. Line 6a. To satisfy the alternative integral Section III. Organizational Test If you meet exceptions for late filing, your part test as a supporting organization, you exemption under section 501(c)(3) will be must distribute at least 85% of your annual Line la. If you answered "No" to line la, you must amend your organizing effective from the date you were legally net income to the organization(s) you formed. support. See the Glossary for a document to specify the supported description of "net income" to be used in organization(s) by name, purpose, or If you don't meet any exceptions, your calculating whether you meet the 85% class. Otherwise, you will not meet the exemption under section 501(c)(3) will be distribution threshold. operational test under section 509(a)(3) effective from the date you filed your and you will need to go back to Part X to application. Answer "Yes" If you distribute at least reconsider your public charity status. 85% of your net income to the supported Line 1. Answer "Yes" If you are a church organization(s). For purposes of this Line lb. If you answered "No" to line tb, or an association of churches. You should schedule, "net income" has the same you must amend your organizing have also checked Part X, line 5a, and meaning as the term "adjusted net document to specify the supported completed Schedule A. If you qualify as a income; which is applicable to private organization(s) by name. Otherwise you church or an association of churches, your operating foundations. will not meet the operational test under exemption will be effective from the date In general, "adjusted net income" is the section 509(a)(3) and you will need to go of your legal formation. excess of gross income, including gross back to Part X to reconsider your public charity status. Answer "Yes" If you are an integrated income from any unrelated trade or auxiliary of a church. If you qualify as an business, determined with certain integrated auxiliary of a church, your modifications, reduced by total Section IV. Disqualified Person exemption will be effective from the date deductions. Gross income doesn't include Test of your legal formation. gifts, grants, or contributions. Control. As a section 509(a)(3) An "integrated auxiliary of a church" If you answer line 6a "No," and your refers to a class of organizations that are answer to line 5 was "No," unless you supporting organization, you may not be controlled directly or indirectly by related to a church or convention or establish that the supported association of churches, but aren't such organization(s) will be attentive to your disqualified persons. You are controlled If disqualified persons can exercise 50% or organizations themselves. In general, you operations, you don't meet the "operated must: in connection with" relationship test. Go more of the total voting power of your governing body. You are also controlled if • Be described as both tax exempt under back to Part X to reconsider your public section 501(c)(3) and a public charity charity status. disqualified persons have authority to affect significant decisions, such as power described in sections 509(a)(1), (2), or (3); Line 6b. Submit a list that shows the total over your investment decisions, or power and amount distributed annually to each over your charitable disbursement • Receive financial support primarily from supported organization. Also, Indicate how decisions. You are also controlled if internal church sources as opposed to each amount will vary from year to year. disqualified persons can exercise veto public or governmental sources. Line 6c. Submit a list that shows the total power. Although control is generally Men's and women's organizations, annual income for each supported demonstrated where disqualified persons seminaries, mission societies, and youth organization. have the authority over your governing groups that satisfy the above referenced body to require you to take an action or sections 501(c)(3) and 509(a)(1), (2), or Line 6d. Answer "Yes" if your funds are refrain from taking an action, indirect (3) requirements are considered "earmarked" for a particular program or control by disqualified persons will also integrated auxiliaries whether or not they activity. disqualify you as a supporting meet the internal support requirements. If you distribute your income to, or for organization. More guidance as to the types of the use of, a particular department or See the instructions for Part X, organizations that qualify as integrated program of an organization, list the total line 6b(ii) for a description of the term auxiliaries can be found in Regs. section annual revenue of the supported "disqualified person." 1.6033.2(h). department or program in line 6c. A public charity isn't a disqualified Line 2a. Answer 'Yes" if you are a public Line 7a. The "operated in connection person. charity and your annual gross receipts are with" test requires that you specify the A 'foundation manager means your: normally $5,000 or less. For information supported organization(s) by name in your • Officers, directors, or trustees; or about whether your annual gross receipts are normally $5,000 or less, see Pub. 557. -22- EFTA00812090 If you qualify as an organization with • You reasonably relied on written advice a combination of purposes, such as for annual gross receipts of normally $5,000 from us. poor. frail, and elderly persons. or less, your exemption would be effective • You reasonably relied on the advice of from the date of your legal formation. a qualified tax professional who failed to Section I. General Information Answer "No" if you are a private file or advise you to file Form 1023. about Your Housing foundation, regardless of your gross Answer "Yes" if you wish to request an receipts. extension of time to file under these Line 1. The type of housing you provide Line 2b. Answer "Yes" if: provisions. If you answer 'Yes; describe should include both a description of the in detail the reasons for filing late based type of facility provided, such as • Your gross receipts were normally less than $5,000 for years before your last on the factors listed above. Don't apartment complex, condominium, complete the rest of this schedule. cooperative, or private residence, and the completed tax year, Answer "No" if you don't wish to nature of your facility, such as • Your gross receipts normally exceeded $5,000 for your last completed tax year, request an extension under these assisted-living facility, continuing-care provisions and go to line 6a. facility, nursing home, low-income facility, and • You filed this application within 90 days etc. Line 6a. By checking "Yes," and from the end of your last completed tax completing Part X, line 6a and/or line 6b, Line 7. See the instructions for Part V, year. you are eligible for a ruling to be classified line 7a, for a description of the terms arm's as a public charity from the postmark date length and fair market value. Line 3. Lines 3a, 3b, and 3c are applicable to subordinates included in a of your application. Line 8. Answer "Yes" if you manage or group exemption application. See Pub. Line 6b. If you anticipate significant intend to manage your programs through 557 for information regarding group changes in your sources of support in the your own employees or by using exemptions. If you were a subordinate of a future, answer Yes," and we will base volunteers. Answer "No" if you engage or group exemption that was timely filed and your qualification for a ruling on the intend to engage a separate organization you are filing for exemption within 27 financial information you provide in line 7. or independent contractor. Make sure your months from the date you were notified by If you check "Yes," complete the financial answer is consistent with the information the organization holding the group information requested in line 7 of provided in Part VIII, line 7b. exemption letter that either (1) you are no Schedule E. Line 9. Government programs include longer covered by the group exemption letter, or (2) the group exemption request If you answer "No," we will base your federal, state, or local government qualification for a ruling on the financial programs. was denied, answer "Yes" and don't complete the remainder of this schedule. information you provided in Part IX. If you answer "No," don't complete line 7 of Section II. Homes for the Elderly or Line 4. Answer Yes" if you were formed Schedule E. on or before October 9, 1969. If you are a Handicapped corporation, your formation date is the Line 7. Complete projected budgets of income for the first two full tax years after Line 2a. Answer -Yes" if you charge a date your articles of incorporation were one-time fee for admission to your facility. filed with and approved by your state the date you mailed your Form 1023. See officials. If you are an association, your the specific instructions for Part IX-A. Line 2b. Answer "Yes" if you charge formation date is the date you adopted Statement of Revenues and Expenses daily, weekly, monthly, or annual fees or your organizing document. If you are a lines 1 through 13, if you need guidance maintenance charges. trust, your formation date is generally the on what to include in the various categories. Line 2c. A "community" refers to the area date your trust was both adopted and that will be served by your facility. For funded. example, a community may be a local If you answer "Yes,"don't Schedule F. Homes for the area or a region. Elderly or Handicapped A complete the rest of this schedule. As an organization formed on or before October 9, 1969, your exemption and Low-Income Housing Line 3a. Describe what happens to individuals if they become unable to pay your regular charges. For example, you would be effective from the date of your Homes for the elderly or handicapped are may have a policy whereby you have a legal formation. Answer "No"if you were eligible for tax exemption as charitable reserve fund for maintaining residents who formedafter October 9, 1969. organizations only if they meet the special are having trouble in paying their regular needs of the elderly or handicapped for charges. You may also have a policy of Line 5. You may receive an extension of residential facilities designed to meet their keeping residents who are having trouble time to file Form 1023 beyond the physical, social, recreation, health care, in paying their regular charges in place for 27-month period if you can establish that and transportation needs. Homes for the a period of time to permit them to find you acted reasonably and in good faith, elderly or handicapped must also be alternative housing. Include a copy of any and that granting an extension will not within the financial reach of a significant printed materials that informs the public prejudice the interests of the government. segment of the elderly or handicapped in about your policy. For example, consider the following the community. Once admitted to the provisions. elderly or handicapped housing facility, Line 3b. Describe any arrangements you • You filed Form 1023 before we the organization must have an established have or expect to have with welfare discovered your failure to file. policy to maintain them as residents, to agencies, sponsoring organizations, or • You failed to file because of intervening the extent possible, even if the residents others to assist residents who become events beyond your control. subsequently become unable to pay the unable to afford to remain residents. • You exercised reasonable diligence but monthly charges. Line 4. Describe how you provide for the you were not aware of the filing health care needs of residents, including requirements. (The complexity of your Low-income housing must provide the services provided. This can include filing and experience in these matters is affordable housing for a significant providing for the activities of daily living of taken into consideration.) segment of individuals in your community residents at your facilities and transporting with low incomes. Your housing may serve -23- EFTA00812091 residents to other facilities for medical demonstrate how these distributions Section II services. further your exempt purposes. Line la. Only complete lines la through Line 5. Describe how living units and Generally, distributions made to 4 if you are a private foundation based on common areas are designed to meet the individuals may advance educational your answers to Part X, line 1a. Answer physical needs of residents (such as grab purposes if selection is made: Yes" if you are a private foundation and bars in bathrooms, wide doorways and • In a non-discriminatory fashion in terms you are requesting advance approval of hallways, design of kitchens and of racial preference, your grant-making procedures under bathrooms, etc.). Also, include information • Based on need and/or merit, and section 4945(g). Answer "No if you are a about facilities and programs designed to • To a charitable class in terms of being private foundation but don't wish to meet some combination of physical, available to an open-ended group, rather request advance approval of your emotional, recreational, social, religious, than to pre-selected individuals. grant-making procedures under section and similar needs of residents. 4945(g). If you answer "No," the amounts A scholarship or fellowship is tax free to the recipient only if he or she is a you distribute as educational grants Section M. Low-Income Housing candidate for a degree at an eligible provided to individuals may be considered educational institution and uses the taxable expenditures under section 4945. Line 2. Answer "Yes" if you charge daily, weekly, monthly, or annual fees or scholarship or fellowship to pay qualified Answer "N/A" if you are requesting maintenance charges. education expenses. public charity status in Part X. Qualified education expenses include For more information about advance Schedule G. Successors tuition and fees; and course-related approval of grant-making procedures of a expenses such as books, supplies, and private foundation, go to!RS.gov/ to Other Organizations equipment. Room and board, travel, Advance-Approval-of-Grant-Making- You should complete this schedule as a research, clerical help, and non-required Procedures. successor organization if any of the equipment aren't qualified education Line lb. Check the box for section following situations pertain to you. expenses. See Pub. 970, Tax Benefits for "4945(g)(1)" if your award qualifies as a • You have taken or will take over the Education, for additional information. scholarship or fellowship grant that is activities that were previously conducted awarded on an objective and Selection of individuals using a lottery by another. nondiscriminatory basis and is used for • You have taken or will take over 25% or system generally hasn't been approved by the IRS. study at a school (see the Schedule B for more of the fair market value of the net what is considered a school). assets of another organization. Check the box for section "4945(g)(3)" • You were established upon the Section I if the purpose of your award is to achieve conversion of an organization from a specific objective, produce a report or for-profit to non-profit status. Line lb. If you have different grant programs, describe the purpose and other similar product, or improve or The other organization is the predecessor amount of each program. enhance a literary, artistic, musical, organization. You should complete this scientific, teaching, or other similar schedule regardless of whether the Line lc. If you award educational loans, capacity, skill, or talent of the recipient. predecessor (other organization) was describe the terms of the loan (for Include your educational loan program exempt or not exempt from federal income example, interest rate, duration, under this section. You may check more tax. forgiveness provision, etc.). Also, describe than one box. how any other loan institutions are Line la. For purposes of this schedule, a involved in your program. If your award qualifies as a prize or "for-profit" organization is one in which award that is subject to the provisions of Line ld. Explain how you will publicize section 74(b) and your recipient is persons are permitted to have an ownership or partnership interest, such as your program and whether you publicize to selected from the general public, you don't the general public or to another group of have to request advance approval of your corporate stock. It includes sole proprietorships, corporations, and other possible recipients. Include specific grant-making procedures since a prize or entities that provide for ownership information about the geographic area in award isn't subject to the advance which your program will be publicized and approval procedure requirements because interests. the means you will use, such as through it isn't a grant for travel, study, or other newspaper advertisements, school district similar purposes. See Revenue Rulings Schedule H. Organizations announcements, or community groups. 77-380, 1977-2 C.B. 419; 76-460, 1976.2 Providing Scholarships, Line le. Submit sample copies of your C.B. 371 and 75-393, 1975-2 C.B. 451. Fellowships, Educational solicitation material for applicants or Line 4. For additional information Loans, or Other materials announcing the awards. If regarding private foundations requesting solicitation is done orally through school advance approval of individual grant Educational Grants to counselors or others, explain fully. procedures, go to 1RS.00v/Advance- Individuals and Private Line 2. Organizations that make grants to Approval-Of-Grant-Making-Procedures . Foundations Requesting individuals must maintain adequate Line 4a Answer "Yes" if you award Advance Approval of records and case histories showing the scholarships on a preferential basis name and address of each recipient because you require, as an initial Individual Grant pursuant to Revenue Ruling 56-304, qualification, that the individual be an Procedures 1956.2 C.B. 306. If you answer "No," employee or be related to an employee of explain how you will be able to a particular employer. Complete this schedule if you provide demonstrate that your distributions serve scholarships, fellowships, grants, loans, or exempt purposes. Line 4c. Answer "N/A" if you don't other distributions to individuals for provide scholarships, fellowships, or educational purposes. When answering educational loans to employees of a the questions on this schedule, you should particular employer. -24- EFTA00812092 Line 4d. Answer "N/A" if you don't Line 4e. Answer "N/A" if your answer to For purposes of this schedule, a provide scholarships, fellowships, or line 4d is "N/A? program for children of employees educational loans to children of of a particular employer includes employees of a particular employer. children and family members of employees. Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. If you want your organization to be recognized as tax exempt by the IRS, you are required to give us this information. We need it to determine whether the organization meets the legal requirements for tax-exempt status. The organization isn't required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. The rules governing the confidentiality of the Form 1023 application are covered in Code section 6104. The time needed to complete and file these forms will vary depending on individual circumstances. The estimated average times are: Recordkeeping Learning about the Preparing the form Copying, assembling, and law or the form sending the form to the IRS Parts Ito XI 89 hrs. 26 mins. 5 hrs. 10 mins. 9 hrs. 39 mins. 48 mins. 1023 Sch. A 10 hrs. 2 mins. 6 mins. 16 mins. 1023 Sch. B 15 hrs. 18 mins. 12 mins. 27 mins. 1023 Sch. C 11 hrs. 14 mins. 12 mins. 23 mins. 1023 Sch. D 9 hrs. 48 mins. 42 mins. 53 mins. 1023 Sch. E 14 hrs. 35 mins. 1 hrs. 9 mins. 2 hrs. 22 mins. 16 mins. 1023 Sch. F 11 hrs. 28 mins. 12 mins. 23 mins. 1023 Sch. G 6 hrs. 42 mins. 6 mins. 12 mins. 1023 Sch. H 7 hrs. 53 mins. 42 mins. 51 mins. Comments and suggestions. If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can send us comments from IRS.aoy/FormComments. Or you can write to the: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. NW, IR-6526 Washington, DC 20224 Don't send the form to this address. Instead, see Where to File earlier. Instructions for Form 1023 -25- EFTA00812093 Appendix A: Sample Conflict of Interest Policy Note. This Sample Conflict of Interest Policy is intended to provide an example of a conflict of interest policy for organizations. The sample conflict of interest policy does not prescribe any specific requirements. Therefore, organizations should use a conflict of interest policy that best fits their organization. Note. Items marked Hospital Insert - for hospitals that complete Schedule C are intended to be adopted by hospitals. Article I Purtose The purpose of the conflict of interest policy is to protect this tax-exempt organization's (Organization) interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the Organization or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations. Article II Definitions 1. Interested Person Any director, principal officer, or member of a committee with governing board delegated powers, who has a direct or indirect financial interest, as defined below, is an interested person. (Hospital Insert - for hospitals that complete Schedule C If a person is an interested person with respect to any entity in the health care system of which the organization is a part, he or she is an interested person with respect to all entities in the health care system.) 2. Financial Interest A person has a financial interest if the person has, directly or indirectly, through business, investment, or family: a. An ownership or investment interest in any entity with which the Organization has a transaction or arrangement, b. A compensation arrangement with the Organization or with any entity or individual with which the Organization has a transaction or arrangement. or c. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Organization is negotiating a transaction or arrangement. Compensation includes direct and indirect remuneration as well as gifts or favors that aren't insubstantial. A financial interest isn't necessarily a conflict of interest. Under Article III, Section 2, a person who has a financial interest may have a conflict of interest only if the appropriate governing board or committee decides that a conflict of interest exists. Article Ill Process 1. Duty to Disclose In connection with any actual or possible conflict of interest, an interested person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the directors and members of committees with governing board delegated powers considering the proposed transaction or arrangement. 2. Determining Whether a Conflict of Interest Exists After disclosure of the financial interest and all material facts, and after any discussion with the interested person, he/she shall leave the governing board or committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining board or committee members shall decide if a conflict of interest exists. 3. Procedures for Addressing the Conflict of interest a. An interested person may make a presentation at the governing board or committee meeting, but after the presentation, he/ she shall leave the meeting during the discussion of, andthe vote on, the transaction or arrangement involving the possible conflict of interest. b. The chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement. c. After exercising due diligence, the governing board or committee shall determine whether the Organization can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest. d. If a more advantageous transaction or arrangement isn't reasonably possible under circumstances not producing a conflict of interest, the governing board or committee shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the Organization's best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination it shall make its decision as to whether to enter into the transaction or arrangement. 4. Violations of the Conflicts of Interest Policy a. If the governing board or committee has reasonable cause to believe a member has failed to disclose actual or possible conflicts of interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose. b. lf, after hearing the members response and after making further investigation as warranted by the circumstances, the governing board or committee determines the member has failed to disclose an actual or possible conflict of interest, it shall fake appropriate disciplinary and corrective action. -26- EFTA00812094 Article IV RecordsWceedings The minutes of the governing board and all committees with board delegated powers shall contain: a. The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or possible conflict of interest, the nature of the financial interest, any action taken to determine whether a conflict of interest was present, and the governing board's or committee's decision as to whether a conflict of interest in fad existed. b. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings. Article V Compensation a. A voting member of the governing board who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that members compensation. b. A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization for services is precluded from voting on matters pertaining to that members compensation. c. No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization, either individually or collectively, is prohibited from providing information to any committee regarding compensation. (Hospital Insert - for hospitals that complete Schedule C d. Physicians who receive compensation from the Organization, whether directly or indirectly or as employees or independent contractors, are precluded from membership on any committee whose jurisdiction includes compensation matters. No physician, either individually or collectively, is prohibited from providing information to any committee regarding physician compensation.) Article VI Annual Statements Each director, principal officer and member of a committee with governing board delegated powers shall annually sign a statement which affirms such person: a. Has received a copy of the conflicts of interest policy, b. Has read and understands the policy, c. Has agreed to comply with the policy, and d. Understands the Organization is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes. Article VII Periodic Reviews To ensure the Organization operates in a manner consistent with charitable purposes and doesn't engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects: a. Whether compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm's length bargaining. b. Whether partnerships, joint ventures, and arrangements with management organizations conform to the Organization's written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and don't result in inurement, impermissible private benefit, or in an excess benefit transaction. Article VIII Use of Outside Experts When conducting the periodic reviews as provided for in Article VII, the Organization may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted. -27- EFTA00812095 Appendix B: States with Statutory Provisions Satisfying the Requirements of Internal Revenue Code Section 508(e) The following states have adopted legislation satisfying the requirements of section 508(e) relating to private foundation governing instruments. Information derived from Revenue Ruling 75-38, 1975-1 C.B. 161. ALABAMA — except where otherwise provided by a decree of a court of competent jurisdiction or by a provision in the private foundation's governing instrument which in either case has been entered or made after October 1, 1971, and expressly limits the applicability of State law. ALASKA — except for such private foundations which expressly provide in their governing instruments that the applicable sections of Alaska law don't apply to them. ARKANSAS — except for such private foundations which expressly provide in their governing instruments that the applicable sections of Arkansas law don't apply to them and except in the case of trusts where otherwise provided by decree of a court of competent jurisdiction. CALIFORNIA — except where otherwise provided by a court of competent jurisdiction. COLORADO — with respect to trusts that are private foundations except where otherwise provided by a court of competent jurisdiction. CONNECTICUT — except where otherwise provided by a court of competent jurisdiction. DELAWARE —except for such private foundations which expressly provide in their governing instruments that the applicable sections of Delaware law don't apply to them. DISTRICT OF COLUMBIA — except for such corporations which expressly provide in their governing instruments that the applicable sections of District of Columbia law don't apply to them and except in the case of trusts where otherwise provided by a court of competent jurisdiction. (For purposes of this statute, corporations include corporations organized under any Act of Congress applicable to the District of Columbia as well as corporations organized under the laws of the District of Columbia.) FLORIDA — except for such trusts which file a proper election not to be subject to the applicable provisions of Florida law and for such corporations as to which a court of competent jurisdiction has otherwise determined. GEORGIA — except for such private foundations which file a proper election not to be subject to such law. HAWAII — no exceptions. IDAHO — except for such private foundations which expressly provide in their governing instruments that the applicable sections of Idaho law don't apply to them. ILLINOIS — except for such corporations which have express provisions to the contrary in their articles of incorporation and except for trusts where it is otherwise provided by a court of competent jurisdiction. INDIANA — except where otherwise determined by a court of competent jurisdiction with respect to private foundations organized before January 1, 1970. IOWA — except for such private foundations which expressly provide in their governing instruments that the applicable sections of Iowa law don't apply to them. KANSAS — except where otherwise provided by a court of competent jurisdiction. KENTUCKY — except, with respect to corporations in existence on July 1, 1972, to the extent that such a corporation provides to the contrary by amendment to its articles of incorporation adopted after July 1, 1972, and, with respect to trusts in existence on July 1, 1972, where action is properly commenced on or before December 31, 1972, in a court of competent jurisdiction to excuse the trust from compliance with the requirements of section 508(e) of the Code. LOUISIANA — except for such private foundations which expressly provide in their governing instruments that the applicable sections of Louisiana law don't apply to them. MAINE — except where otherwise provided by a court of competent jurisdiction. MARYLAND — except where otherwise provided by a court of competent jurisdiction. MASSACHUSETTS — except where otherwise provided by a court of competent jurisdiction. MICHIGAN — with respect to trusts that are private foundations except for such private foundations which file a notice of inconsistency under Michigan law. -28- EFTA00812096 MINNESOTA — except for private foundations that have been held by a court of competent jurisdiction not to be affected by such State statute. MISSISSIPPI — except where otherwise provided by a court of competent jurisdiction. MISSOURI — except for private foundations that have been held by a court of competent jurisdiction not to be affected by such State statute. MONTANA — except in the case of trusts where otherwise provided by court decree entered after March 28, 1974, and except in the case of a corporation which has an express provision to the contrary in its articles of incorporation. NEBRASKA — except for such trusts which effectively elect to be excluded from the applicable sections of Nebraska law, for such corporations which have governing instruments expressly providing to the contrary, and except as a court of competent jurisdiction has otherwise determined in any given case. NEVADA — no exceptions. NEW HAMPSHIRE — except where it is otherwise provided by a court of competent jurisdiction. NEW JERSEY — except for such private foundations which expressly provide in their governing instruments that the applicable sections of New Jersey law don't apply to them. NEW YORK — except where such law conflicts with any mandatory direction of an instrument by which assets were transferred prior to June 1, 1971, and such conflicting direction hasn't been removed legally. NORTH CAROLINA — except for such private foundations which expressly provide in their governing instruments that the applicable sections of North Carolina law don't apply to them and except for trusts that have their governing instruments reformed by a decree of the Superior Court of North Carolina. NORTH DAKOTA — with respect to trusts that are private foundations except where otherwise provided by a court of competent jurisdiction. OHIO — except in the case of trusts where it is provided otherwise by a court of competent jurisdiction and except in the case of corporations in existence on September 17, 1971, which expressly adopt contrary provisions in their governing instruments after September 17, 1971. OKLAHOMA — except for such private foundations which file a proper election not to be subject to such law. OREGON — no exceptions. PENNSYLVANIA — except where otherwise provided by a court of competent jurisdiction. RHODE ISLAND — except where otherwise provided by a court of competent jurisdiction. SOUTH CAROLINA — except for private foundations which expressly provide in their governing instruments that the applicable sections of South Carolina law don't apply to them. SOUTH DAKOTA— except where otherwise provided by a court of competent jurisdiction. TENNESSEE — except where otherwise provided by a court of competent jurisdiction. TEXAS — except for such private foundations which file a proper election not to be subject to such law. UTAH — with respect to trusts that are private foundations except where otherwise provided by a court of competent jurisdiction. VERMONT — except where otherwise provided by a court of competent jurisdiction. VIRGINIA —except for private foundations whose governing instruments contain express provisions to the contrary or which have filed a proper election not to be subject to such law. WASHINGTON — except for such private foundations which expressly provide in their governing instruments that the applicable sections of Washington law don't apply to them. WEST VIRGINIA — with respect to trusts that are private foundations except for such trusts which provide in their governing instruments that the applicable sections of West Virginia law don't apply to them. WISCONSIN — except as may otherwise be provided by decree of a court of competent jurisdiction. WYOMING — except where otherwise provided by a court of competent jurisdiction. -29- EFTA00812097 Appendix C: Glossary of Terms Adjusted net income (for Schedule D) Adjusted net income includes: gross income from any unrelated trade or business; gross income from functionally related businesses; interest payments received on loans; amounts received or accrued as repayments of amounts taken as qualifying distributions for any tax year, amounts received or accrued from the sale or other disposition of property to the extent acquisition of the property was treated as a qualifying distribution for any tax year; any amounts set aside for a specific project to the extent the full set aside was not necessary for the project; interest on govemment obligations normally excluded under section 103 of the Code; net short-term capital gains on sale or other disposition of properly; and income received from an estate if the estate is considered terminated for income tax purposes because of a prolonged administration period. It doesn't include: gifts, grants, and contributions received; long-term capital gains or losses; net section 1231 gains; capital gain dividends; the excess of fair market value over adjustedbasis of property distributed to the U.S. or a possession or political subdivision, a State or its political subdivision, a charitable trust, or corporation for public purposes; or income received from an estate during the administration period. In computing adjusted net income, deduct the following: ordinary and necessary expenses paid or incurred for the production or collection of gross income, or for the management, conservation, or collection of gross income (includes operating expenses such as compensation of officers, employee wages and salanes, interest, rent, and taxes); straight-line depreciation and depletion (not percentage depletion); and expenses and interest paid or incurred to carry tax-exempt obligations. Don't deduct net short-term capital losses for the year in which they occur (these losses cannot be carried back or carried over to earlier or later tax years); the excess of expenses for property used for exempt purposes over the income received from the property; charitable contributions made by you; net operating losses; and special deductions for corporations. Affiliated Created by, controlled by, or closely related to a governmental unit, including a State a possession of the United States, or any political subdivision of a State or a possession of the United States, or the United States, or the District of Columbia. Arm's length A transaction between parties having adverse (or opposing) interests; where none of the participants are in a position to exercise substantial influence over the transaction because of business or family relationship(s) with more than one of the parties. Authorized representative By submitting Form 2848, an attorney or certified public accountant who is permitted to represent you before us regarding your application for tax-exempt status. Bingo A game of chance played with cards that are generally printed with 5 rows of 5 squares each, on which participants place markers to form a pre-selected pattern to win the game. Bingo is gambling. Business relationships Employment and contractual relationships, and common ownership of a business where any officers, directors, or trustees, individually or together, possess more than a 35% ownership interest in common. Ownership means voting power in a corporation, profits interest in a partnership, or beneficial interest in a trust. Bylaws The intemal rules and regulations of an organization. Certification of filing Articles of incorporation for your organization showing evidence that on a specific date they were filed with and approved by an appropriate state authority. -30- EFTA00812098 Charitable risk pool An organization described in section 501(n), which is organized and operated to pool insurable risks (other than medical malpractice) of its section 501(c)(3) members. Close connection A relationship between organizations that may include control of one organization by another through common governance or through authority to approve budgets or expenditures; coordination of operations as to facilities, programs, employees, or other activities; or common persons exercising substantial influence over all of the organizations. Common control You and one or more other organizations have (1) a majority of your governing boards or officers appointed or elected by the same organizafion(s), or (2) a majonty of your governing boards or officers consist of the same individuals. Common control also occurs when you and one or more commonly controlled organizations have a majority ownership interest in a corporation, partnership, or trust. Ownership means voting power in a corporation, profits interest in a partnership, or beneficial interest in a trust. Community The local or regional geographic area to be served by an organization. Compensation All forms of income from working, including salary or wages; deferred compensation; retirement benefits, whether in the form of a qualified or non-qualified employee plan (for example: pensions or annuities); fringe benefits (for example: personal vehicle, meals, lodging, personal and family educational benefits, low interest loans, payment of personal travel, entertainment, or other expenses, athletic or country club membership, and personal use of your property); and bonuses. Conflict of interest policy A conflict of interest arises when a person in a position of authority over an organization, such as a director, officer, or manager, may benefit personally from a decision he or she could make. A conflict of interest policy consists of a set of procedures to follow to avoid the possibility that those in positions of authority over an organization may receive an inappropriate benefit. Controlled by disqualified persons As a section 509(a)(3) supporting organization, you may not be controlled directly or indirectly by disqualified persons. You are controlled if disqualified persons can exercise 50% or more of the total voting power of your governing body. You are also controlled if disqualified persons have authority to affect significant decisions, such as power over your investment decisions, or power over your charitable disbursement decisions. You are also controlled if disqualified persons can exercise veto power. Although control is generally demonstrated where disqualified persons have the authority over your governing body to require you to take an action or refrain from taking an action, indirect control by disqualified persons will also disqualify you as a supporting organization. Cooperative hospital service An organization described in section 501(e) is organized and operated on organization a cooperative basis to provide its section 501(c)(3) hospital members one or more of the following activities: data processing, purchasing (including purchasing insurance on a group basis), warehousing, billing and collection (including purchasing patron accounts receivable on a recourse basis), food, clinical, industrial engineering, laboratory, printing, communications, record center, and personnel (including selecting, testing, training, and educating personnel) services. Cooperative service organization of An organization described in section 501(f) is organized and operated to operating educational organizations provide investment services to its members. Those members must be organizations described in section 170(b)(1)(A)(ii) or (iv), and either tax exempt under section 501(a) or whose income is excluded from taxation under section 115(a). Corporation An entity organized under a Federal or state statute, or a statute of a federally recognized Indian tribal or Alaskan native government. -31- EFTA00812099 Develop Develop means the planning, financing, construction, or provision of similar services involved in the acquisition of real property, such as land or a building. Disqualified person Any individual or organization that is any of the following. a. A substantial contributor to you (see Substantial contributor). b. An officer, director, trustee, or any other individual who has similar powers or responsibilities. c. An individual who owns more than 20% of the total combined voting power of a corporation that is a substantial contributor to you. d. An individual who owns more than 20% of the profits interest of a partnership that is a substantial contributor to you. e. An individual who owns more than 20% of the beneficial interest of a trust or estate that is a substantial contributor to you. f. A member of the family of any individual described in a, b, c, d, or e above. g. A corporation in which any individuals described in a, b, c, d, e, or f above hold more than 35% of the total combined voting power. h. A trust or estate in which any individuals described in a, b, c, d, e, or f above hold more than 35% of the beneficial interests. i. A partnership in which any individuals described a, b, c, d, e, or f above hold more than 35% of the profits interest. Earmark Donations or other contributions given to you to assist particular individuals or specific identified groups. Economic development Organizations formed to combat community deterioration by assisting businesses located in a particular geographic area whose economy is economically depressed or deteriorating. Economic development activities include grants, loans, provision of information and expertise, or creation of industrial parks. Economic development organizations may also be formed to eliminate prejudice and discrimination or lessen the burdens of government through involvement with business development. Elderly housing Generally, the primary beneficiaries of the tax-exempt housing are age 62 and older. The elderly are treated as appropriate charitable beneficiaries for certain purposes regardless of socio-economic status because, as a group, they face many barriers to their basic needs as they age. The elderly, as a class, face forms of distress other than financial, such as the need for suitable housing; physical and mental health care; civic, cultural, and recreational activities; and an overall environment conducive to dignity and independence. Expenses Financial burdens or outlays, costs (of doing business), and business outlays chargeable against revenues. For purposes of this form, expenses mean direct and indirect expenses. Fair market value The price at which property or the right to use property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy, sell, or transfer property or the right to use property, and both having reasonable knowledge of relevant facts. Family Includes an individual's spouse, ancestors, children, grandchildren, great- grandchildren, siblings (whether by whole or half blood), and the spouses of children, grandchildren, great-grandchildren, and siblings. Foreign country A country other than the United States, its territories and possessions, and the District of Columbia. For-profit A business entity whose activities are conducted or maintained to make a profit (e.g. revenues greater than expenses). Foundation manager Officer; directors, or trustees, or an individual having powers or responsibilities similar to those of a foundation's officers, directors, or trustees. Fundraising The organized activity of raising funds, whether by volunteers, employees, or paid independent contractors. -32- EFTA00812100 Gainfully employed Employed or actively looking for work. Gaming The term gaming includes activities such as Bingo, Beano, lotteries, pull-tabs, pari-mutuel betting, Calcutta wagering, pickle jars, punch boards, tip boards, tip jars, certain video games, 21, raffles, keno, split-the-pot, and other games of chance. Gross investment income As defined in section 509, gross investment income means the gross amount of income from interest, dividends, payments with respect to securities loans, rents, and royalties; but not including any such income to the extent included in computing the tax imposed by section 511. Gross receipts For purposes of Part IX-A. Statement of Revenues and Expenses, gross receipts includes monies earned from activities related to your chantable or other section 501(c)(3) activities, such as selling admissions or merchandise, performing services, or furnishing facilities. Handicapped Persons with physical or mental disabilities with special needs for suitable housing; physical and mental health care; civic, cultural, and recreational activities; transportation; and an overall environment conducive to dignity and independence. Hospital Hospital or medical care includes the treatment of any physical or mental disability or condition, whether on an inpatient or outpatient basis. A hospital includes the following. a. Hospitals and rehabilitation institutions, outpatient clinics, or community mental health or drug treatment centers if the principal purpose or function is the providing of medical or hospital care or medical education or research. b. Medical research organizations, if the principal purpose or function is the continuous active conduct of medical research in conjunction with a hospital. Independent contractors Persons who aren't treated as employees for employment tax purposes. Influence legislation The act of directly contacting or urging the public to contact members of a legislative body for the purpose of proposing, supporting, or opposing legislation. You are also attempting to influence legislation it you advocate the adoption or rejection of legislation. Intellectual property A type of property (distinct from real or personal property) including the following. a. Patents (for inventions). b. Copyrights (for literary and artistic works such as novels, poems, plays, films, musical works, drawings, paintings, photographs, sculptures, architectural designs, performances, recordings, film, and radio or television programs). c. Trade names, trade marks, and service marks (for symbols, names, images, and designs). d. Formulas, know-how, and trade secrets. Joint ventures A legal agreement in which the parties jointly undertake a transaction for mutual profit. Generally, each person contributes assets and shares risks. Like a partnership, joint ventures can involve any type of business transaction and the "persons" involved can be individuals, groups of individuals, companies, or corporations. Limited liability company A limited liability company (LLC) is a business entity organized in the United States under state law. Generally, an LLC may be classified for federal income tax purposes as a partnership, corporation, or an entity disregarded as separate from its owner by applying the rules in Regulations section 301.7701-3. However, an LLG that has been determined to be, or claims to be, exempt from taxation under section 501(a) is treated as having made an election to be classified as a corporation under Regulations section 301.7701-3(c)(1)(v). Low-income housing Rental or ownership housing provided to persons based on financial need. Mailing address Address where you wish all correspondence to be sent. Manage Manage means to direct or administer. -33- EFTA00812101 Medical care The treatment of any physical or mental disability or condition, whether on an inpatient or outpatient basis. Medical research organization An organization whose principal purpose or function is the continuous active conduct of medical research in conjunction with a hospital. Net income (for Schedule D) See Adjusted net income. Non-fixed payments A non-fixed payment means a payment that depends on discretion. For example, a bonus of up to $100,000 that is based on an evaluation of performance by the governing board is a non-fixed payment because the governing body has discretion over whether the bonus is paid and the amount of the bonus. Organizing document The organizing document depends on the form of the organization. For a corporation, the document is the articles of incorporation. For an LLC the document is the articles of organization. For an unincorporated association, the document is the articles of association or constitution. The organizing document of a trust is the trust agreement. Political You participate in a political campaign if you promote or oppose, through political literature, brochures, pamphlets, hosting or participating in events, etc., the candidacy of an individual for public office. Debates and nonpartisan voter education aren't considered political. Predecessor An organization whose activities or assets were taken over by another organization. Private foundations Organizations that are exempt under section 501(c)(3) are private foundations unless they are churches, schools, hospitals, governmental units, entities that undertake testing for public safety, organizations that have broad financial support from the general public, or organizations that support one or more other organizations that are themselves classified as public charities. Private operating foundation A type of private foundation that lacks general public support, but makes qualifying distributions directly for the active conduct of its educational, charitable, and religious purposes. "Directly for the active conduct" means that the distributions are used by the foundation itself to carry out the programs for which it is organized and operated. Grants made to assist other organizations or individuals are normally considered indirect. Public charity Organizations that are exempt under section 501(c)(3) and aren't private foundations because they are churches, schools, hospitals, governmental units, entities that undertake testing for public safety, organizations that have broad financial support from the general public, or organizations that support one or more other organizations that are themselves classified as public charities. Public charity status is a more favorable tax status than private foundation status. Reasonable compensation Reasonable compensation is the amount that would ordinarily be paid for like services by like organizations under like circumstances as of the date the compensation arrangement is made. Reasonable compensation is important because excessive benefits in the form of compensation to disqualified persons may result in the imposition of excise taxes and jeopardize the organization's tax-exempt status. Related The family or business relationships between persons. -34- EFTA00812102 Relationship A relationship between you and the recipient organization includes the following situations. a. You control the organization or it controls you through common officers, directors, or trustees, or through authority to approve budgets or expenditures. b. You and the organization were created at approximately the same time and by the same persons. c. You and the organization operate in a coordinated manner with respect to facilities, programs, employees, or other activities. d. Persons who exercise substantial influence over you also exercise substantial influence over the other organization. Revenue Revenue means gross revenue amounts. Revenue Procedure An official statement of a procedure published in the IRS Cumulative Bulletin that either affects the rights or duties of taxpayers or other members of the public under the Internal Revenue Code and related statutes, treaties, and regulations or, although not necessarily affecting the rights and duties of the public, should be a matter of public knowledge. Revenue Ruling An official interpretation by the IRS of the Internal Revenue laws and related statutes, treaties, and regulations, that has been published in the Cumulative Bulletin. Revenue Rulings are issued only by the National Office and are published for the information and guidance of taxpayers, IRS officials, and others concerned. SS-4 Application for Employer Identification Number. School A school is an educational organization whose primary function is the presentation of formal instruction and which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on. A school may include the following. a. Primary, secondary, preparatory, or high school. b. College or university. c. Trade or technical school. d. Nursery or preschool. e. School that you operate as an activity, such as school that is operated as an activity of a museum, historical society, or church. Similarly situated Similarly situated organizations means tax-exempt or taxable organizations of a comparable size, purpose, and resources. Substantial contributor Any individual or organization that gave more than $5,000 to you from the date you were formed or other date that your exemption would be effective, to the end of the year in which the contributions were received. This total amount contributed must also be more than 2% of all the contributions you received. A creator of a trust is treated as a substantial contributor regardless of the amount contributed. Successor An organization that took over: a. More than a negligible amount of the activities that were previously conducted by another organization, b. 25% or more of the fair market value of the net assets of another organization, or c. Was established upon the conversion of an organization from for-profit to non-profit status. Trust A trust is an entity that may be formed by a trust agreement or declaration of trust. A trust may also be formed through a will. Unincorporated association An unincorporated association formed under state law must have at least two members who have signed a written document for a specifically defined purpose. Unusual grants Substantial contributions and bequests from disinterested persons that by their size adversely affect classification as a public charity. They are: a. Unusual, b. Unexpected, and c. Received from an unrelated party. -35- EFTA00812103 Index Bylaws 7 United States territories and A Charitable 8 possessions N Adjusted net income 22 Church 15, 17 organizations 6 NASCO 2 Affiliated 10 Common control 9 Virgin Island Non-fixed payment 9 Annual filing requirements 5 Compensation 8 organizations 6 Annual returns for foreign Conflict of interest 9 Form 2848 4 organizations 6 Cooperative hospital Form 5768 10 O Answers 3 service organization 12 Form 8821 5 Operated 2 Appendix: Corporation 7 For-profit organization 24 Qualification 2 Glossary of terms 36 Directly for the active Foundation manager 22 Operating document 7 Sample conflict of interest conduct 15 Fundraising 10 Organization's website 7 policy 26 Disqualified person 16 Organizational structure 7 States with statutory Elderly housing 12 Organized 2 provisions satisfying the Fair market value 9 G Influence legislation 2 requirements of section Family relationships 9 Gainfully employed 11 Legislative activity 2 508(e) 28 Fixed payment 9 Gaming activities 10 Qualification 2 Application for exemption: Foreign county 11 Glossary of terms 30 Organizing document 2 Expedite requests 3 For-profit organization 24 Group exemption 3 Dissolution clause 8 Group exemption 3 Foundation manager 22 Leaving a group Purpose clause 8 Language and currency Fundraising 10 exemption 3 Required provisions 8 requirements 3 Handicapped housing 12 Substitute articles of Leaving a group Hospital 19 incorporation 7 exemption 3 Hospital or medics care 12 H Unincorporated Past, present and planned Influence legislation 10 Handicapped housing 12 association 7 activities 3 Intellectual property 11 Homes for the elderly or Purpose 3 Joint venture 11 handicapped 23 User fee 3 Legislation 2 Community 23 p Application package Low-income housing 12 Hospital 19 Past, present and planned assembly 4 Medical research 19 Conflict of interest activities 3 Arm's length 9 Medical research policy 20 Political campaign Articles of Incorporation 7 organization 19 Hospital or medical care 12 intervention 2 Articles of organization 7 Non-fixed payment 9 How to answer 3 Predecessor 24 Assistance 4 Reasonable Primary contact person 7 Attachments 4 compensation 9 Private foundations 2, 12, Authorized representative 7 School 12, 18 Private operating Similarly situated 9 Independent contractors 9 foundations 15 Substantial contributor 16 Influence legislation 10 Public charities 2 B Successor 10 Integrated auxiliary of a Public charities and private Business relationships 9 Unusual grants 13 church 22 foundations 2 Bylaws Z Disqualified person 16 Intellectual property 11 Public inspection 5 Dissolution clause: Public support test 16 Testamentary charitable Purpose clause: C trust 8 J Charitable 8 Canadian organizations 6 Distribution of assets at Joint venture 11 Certification of filing 7 dissolution 8 Charitable risk pool 12 State laws 8 O Church 17 L Qualification: Prescribed course of Language and currency Operated 2 study 17 E requirements 3 Organized 2 Common control 9 Economic development 11 Leaving a group exemption 3 Political campaign Ownership 9 EIN (See Employer Legislation 2 intervention 2 Compensation: identification number) Definition 2 Qualifications 2 Definition 8 Elderly housing 12 Form 5768 2 Conflict of interest 9 Employer Identification Legislative activity 2 Conflict of interest policy 9 number 6 Election to influence R Cooperative hospital service Expedite requests 3 legislation 2 Reasonable compensation 9 organization 12 Limited liability company 7 Related 9 Corporation: LLC (See Limited liability Representation 4 Articles of Incorporation 7 F company) Form 2848 4 Certification of filing 7 Facts and circumstances Low-income housing 12, 23 Form 8821 5 test 16 Fair market value 9 D Family relationships 9 M S Definitions: Filing assistance 4 Mailing address 6 Sample conflict of interest Adjusted net Income 22 Fixed payment 9 Medical research 19 policy 26 Affiliated 10 Foreign country 11 Medical research Scholarships, fellowships, Arm's length 9 Foreign organizations 6,11 organization 19 grants, loans 24 Authorized Annual returns 6 Month and annual accounting School 12,18 representative 7 Canadian organizations 6 period 7 Operational information 18 Bingo 19 General 6 Racially nondiscriminatory Business relationships 9 policy 18 -36- EFTA00812104 Section 501(c)(3) organization: State registration: User fee 3, 17 Eligibility 1 NASCO 2 T Private foundations 2 States with section 508(e) Tax-exempt status: Public charities 2 provisions 28 Form 1023 3 V Public charities and private States with statutory provisions Trust 7 Virgin Island organizations 6 foundations 2 satisfying the requirements Non-charitable interests 7 Qualifications 2 of section 508(e) 28 Will 7 Section 509(a)(3) Substantial contributor 16 organization 21 Successor 10,24 What to file: Signature 4 Supporting organization 21 U Required schedules 4 Similarly situated Unincorporated association 7 When to file 4 organizations 9 United States territories and Where to file 4 Statement of revenue and possessions 6 expenses 12 Unusual grants 13,16 -37- EFTA00812105