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File 2011 State Taxes

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SOI Tax Stats - Domestic Private Foundation and Charitable Trust Statistics

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Snapshot of Private Foundation Statistics

Private foundations organized for charitable purposes are exempt from income taxes. They are differentiated from tax-exempt public charities by their narrow bases of control and financial support. Statistics on private foundations are compiled from Form 990-PF, an annual information return that includes data on excise tax liability, charitable distributions, administrative expenditures, as well as income statement and balance sheet information. Data are available for the following types of organizations:

  • Operating Foundations—Generally conduct their own charitable activities, e.g., museums
  • Nonoperating Foundations—Generally provide charitable support through grants and other financial means to charitable organizations; the majority of foundations are nonoperating
  • Section 4947(a)(1) Nonexempt Charitable Trusts—Charitable trusts treated as private foundations for tax purposes; may be operating or nonoperating

Statistical Tables   Publications and Papers   Microdata   Other IRS Data
 

For information about selected terms and concepts, a description of the data sources and limitations, and links to recent revisions of Form 990-PF, please visit the Private Foundations Study Metadata page.


Statistical Tables

The following tables are available as Microsoft Excel® files. A free Excel viewer is available for download, if needed.

NOTE: Statistics for the years denoted by an asterisk (*) include information reported by both domestic and foreign foundations and charitable trusts.

Domestic Private Foundations:
     Number and Selected Financial Data
      Classified by: Type of Foundation and Size of End-of-Year Fair Market Value of Total Assets
      Tax Years: 2010  2009  2008  2007  2006  2005  2004  2003  2002  2001  2000  1999  1998  1997  1996  1995  1994  1993  1992  1991  1990  1989  1988  1987  1986  1985
 
     Income Statements and Balance Sheets
      Classified by: Size of End-of-Year Fair Market Value of Total Assets
      Tax Years: 2010  2009  2008  2007  2006  2005  2004  2003  2002  2001  2000  1999  1998  1997  1996  1996*  1995*  1994*  1993*  1992*  1991*
    Selected Data Items in Current Dollars
      Classified by: Asset Size
      Tax Years: 1993–2002

 
Domestic Nonoperating Private Foundations:
     Disbursements for Charitable Purposes—in Constant Dollars
      Tax Years: 1985–2010
 
     Disbursements for Charitable Purposes—in Current Dollars
      Tax Years: 1985–2010
 
     Noncharitable-Use Assets and Qualifying Distributions
      Tax Years: 1985–2010
 
     Largest 100 Nonoperating Private Foundations—Selected Financial Data
      Tax Years: Panel Study, 1985–1997
 
     Selected Data Items by Asset Size—in Current Dollars
      Tax Years: 1993–2002

 
Domestic IRC Section 4947(a)(1) Charitable Trusts Treated as Foundations:
     Number and Selected Financial Data
      Classified by: Type of Charitable Trust and Size of End-of-Year Fair Market Value of Assets
      Tax Years: 2010  2009  2008  2007  2006  2005  2004  2003  2002  2001  2000  1999  1998  1997  1996  1996*  1995*  1994*  1993*  1992*  1991*
 
     Income Statements and Balance Sheets
      Classified by: Size of End-of-Year Fair Market Value of Assets
      Tax Years: 2010  2009  2008  2007  2006  2005  2004  2003  2002  2001  2000  1999  1998  1997  1996  1996*  1995*  1994*  1993*  1992*  1991*

 
Excise Taxes Reported by Charities, Private Foundations, and Split-Interest Trusts on Form 4720
      Classified by: Type of Excise Tax
      Calendar Years: 2011  2010  2009  2008  2007  2006  2005  2004  2003

 
To make customized tables using these data, please visit the Statistics of Income Tax Stats Table Wizard

 
Historical Table:
Table 16—Nonprofit Charitable Organization and Domestic Private Foundation Information Returns, and Tax-Exempt Organization Business Income Tax Returns: Selected Financial Data, Expanded
      Published as: SOI Bulletin Historical Table 16

 
Projections
For selected tax returns, including the Form 990-PF, IRS's Office of Research produces annual forecasts of the number of returns that will be filed in future years.
     Projections of Returns to be Filed in Future Calendar Years
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Publications and Papers

The following are available as PDF files. A free Adobe® reader is available for download, if needed.

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Other SOI Data on Trusts

Form 5227 is an information return filed by split-interest trusts, those who make distributions to both charitable and noncharitable beneficiaries, while providing tax benefits to their donor. Form 1041 is the income tax return filed by fiduciaries to report income, distributions, and tax liability of estates and trusts.

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Microdata Files

Microdata are individual organization-level data that can be used for research purposes.

The data are contained in XML, ASCII flat files, Microsoft Excel spreadsheets and Adobe Acrobat PDF. Documentation to assist with the files is included. (Free Adobe Acrobat reader, WinZip utility, and Microsoft Excel viewer software is available for download, if needed.)
 

SOI Sample Data Files

This section contains microdata files for all Forms 990-PF sampled for the annual SOI studies of private foundations. The data for each of the annual studies are included in a comprehensive, "harmonized" dataset, with standardized variable names and codes based on the form revision of the latest available Tax Year.

The sample include returns filed by private foundations, exempt under Internal Revenue Code section 501(c)(3), and section 4947(a)(1) nonexempt charitable trusts. The stratified random samples are based on asset size and represent approximately 10 percent of Forms 990-PF filed; sampling rates of 100 percent are applied to large-asset classes. Microdata records contain most financial information from Forms 990-PF, as well as weights (to estimate the population), for each organization.

Available Data:  Tax Years 1985-2010 

Data Element Reference List

Click on one of the following links to access a page with links to data in the desired format.

         ASCII text     XML     

To make customized tables using these data, please visit the Statistics of Income Tax Stats Table Wizard.  
 

IRS Population Data

This page contains microdata files for all Forms 990, 990-EZ, and 990-PF returns filed by active organizations.  Data are from the IRS Exempt Organization Master File.

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Other IRS Data and Related Links

For tax administration data on this topic, as well as other types of taxes, choose from the links below.

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Return to Tax Stats home page .

Page Last Reviewed or Updated: 14-Jan-2014

The File 2011 State Taxes

File 2011 state taxes 3. File 2011 state taxes   Section 501(c)(3) Organizations Table of Contents IntroductionChild care organizations. File 2011 state taxes Topics - This chapter discusses: Useful Items - You may want to see: Contributions to 501(c)(3) OrganizationsCertain annuity contracts. File 2011 state taxes Certain contracts held by a charitable remainder trust. File 2011 state taxes Excise Taxes. File 2011 state taxes Indoor tanning services. File 2011 state taxes Application for Recognition of ExemptionPolitical activity. File 2011 state taxes Private delivery service. File 2011 state taxes Amendments to organizing documents required. File 2011 state taxes How to show reasonable action and good faith. File 2011 state taxes Not acting reasonably and in good faith. File 2011 state taxes Prejudicing the interest of the Government. File 2011 state taxes Procedure for requesting extension. File 2011 state taxes More information. File 2011 state taxes Organizations Not Required To File Form 1023 Articles of OrganizationOrganizational Test Dedication and Distribution of Assets Educational Organizations and Private SchoolsEducational Organizations Private Schools Organizations Providing InsuranceCharitable Risk Pools Other Section 501(c)(3) OrganizationsCharitable Organizations Religious Organizations Scientific Organizations Literary Organizations Amateur Athletic Organizations Prevention of Cruelty to Children or Animals Private Foundations and Public CharitiesPrivate Foundations Public Charities Private Operating Foundations Lobbying ExpendituresLobbying expenditures. File 2011 state taxes Grass roots expenditures. File 2011 state taxes Lobbying nontaxable amount. File 2011 state taxes Grass roots nontaxable amount. File 2011 state taxes Organization that no longer qualifies. File 2011 state taxes Tax on organization. File 2011 state taxes Tax on managers. File 2011 state taxes Taxes on organizations. File 2011 state taxes Taxes on managers. File 2011 state taxes Political expenditures. File 2011 state taxes Correction of expenditure. File 2011 state taxes Introduction An organization may qualify for exemption from federal income tax if it is organized and operated exclusively for one or more of the following purposes. File 2011 state taxes Religious. File 2011 state taxes Charitable. File 2011 state taxes Scientific. File 2011 state taxes Testing for public safety. File 2011 state taxes Literary. File 2011 state taxes Educational. File 2011 state taxes Fostering national or international amateur sports competition (but only if none of its activities involve providing athletic facilities or equipment; however, see Amateur Athletic Organizations , later in this chapter). File 2011 state taxes The prevention of cruelty to children or animals. File 2011 state taxes To qualify, the organization must be a corporation, community chest, fund, articles of association, or foundation. File 2011 state taxes A trust is a fund or foundation and will qualify. File 2011 state taxes However, an individual or a partnership will not qualify. File 2011 state taxes Examples. File 2011 state taxes   Qualifying organizations include: Nonprofit old-age homes, Parent-teacher associations, Charitable hospitals or other charitable organizations, Alumni associations, Schools, Chapters of the Red Cross, Boys' or Girls' Clubs, and Churches. File 2011 state taxes Child care organizations. File 2011 state taxes   The term educational purposes includes providing for care of children away from their homes if substantially all the care provided is to enable individuals (the parents) to be gainfully employed and the services are available to the general public. File 2011 state taxes Instrumentalities. File 2011 state taxes   A state or municipal instrumentality may qualify under section 501(c)(3) if it is organized as a separate entity from the governmental unit that created it and if it otherwise meets the organizational and operational tests of section 501(c)(3). File 2011 state taxes Examples of a qualifying instrumentality might include state schools, universities, or hospitals. File 2011 state taxes However, if an organization is an integral part of the local government or possesses governmental powers, it does not qualify for exemption. File 2011 state taxes A state or municipality itself does not qualify for exemption. File 2011 state taxes Topics - This chapter discusses: Contributions to 501(c)(3) organizations, Applications for recognition of exemption, Articles of Organization, Educational organizations and private schools, Organizations providing insurance, Other section 501(c)(3) organizations, Private foundations and public charities, and Lobbying expenditures. File 2011 state taxes Useful Items - You may want to see: Forms (and Instructions) 1023 Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code See chapter 6 for information about getting publications and forms. File 2011 state taxes Contributions to 501(c)(3) Organizations Contributions to domestic organizations described in this chapter, except organizations testing for public safety, are deductible as charitable contributions on the donor's federal income tax return. File 2011 state taxes Fundraising events. File 2011 state taxes   If the donor receives something of value in return for the contribution, a common occurrence with fundraising efforts, part or all of the contribution may not be deductible. File 2011 state taxes This may apply to fundraising activities such as charity balls, bazaars, banquets, auctions, concerts, athletic events, and solicitations for membership or contributions when merchandise or benefits are given in return for payment of a specified minimum contribution. File 2011 state taxes   If the donor receives or expects to receive goods or services in return for a contribution to your organization, the donor cannot deduct any part of the contribution unless the donor intends to, and does, make a payment greater than the fair market value of the goods or services. File 2011 state taxes If a deduction is allowed, the donor can deduct only the part of the contribution, if any, that is more than the fair market value of the goods or services received. File 2011 state taxes You should determine in advance the fair market value of any goods or services to be given to contributors and tell them, when you publicize the fundraising event or solicit their contributions, how much is deductible and how much is for the goods or services. File 2011 state taxes See Disclosure of Quid Pro Quo Contributions in chapter 2. File 2011 state taxes Exemption application not filed. File 2011 state taxes   Donors cannot deduct any charitable contribution to an organization that is required to apply for recognition of exemption but has not done so. File 2011 state taxes Separate fund—contributions that are deductible. File 2011 state taxes   An organization that is exempt from federal income tax other than as an organization described in section 501(c)(3) can, if it desires, establish a fund, separate and apart from its other funds, exclusively for religious, charitable, scientific, literary, or educational purposes, fostering national or international amateur sports competition, or for the prevention of cruelty to children or animals. File 2011 state taxes   If the fund is organized and operated exclusively for these purposes, it may qualify for exemption as an organization described in section 501(c)(3), and contributions made to it will be deductible as provided by section 170. File 2011 state taxes A fund with these characteristics must be organized in such a manner as to prohibit the use of its funds upon dissolution, or otherwise, for the general purposes of the organization creating it. File 2011 state taxes Personal benefit contracts. File 2011 state taxes   Generally, charitable deductions will not be allowed for a transfer to, or for the use of, a section 501(c)(3) or (c)(4) organization if in connection with the transfer: The organization directly or indirectly pays, or previously paid, a premium on a personal benefit contract for the transferor, or There is an understanding or expectation that anyone will directly or indirectly pay a premium on a personal benefit contract for the transferor. File 2011 state taxes   A personal benefit contract with respect to the transferor is any life insurance, annuity, or endowment contract, if any direct or indirect beneficiary under the contract is the transferor, any member of the transferor's family, or any other person designated by the transferor. File 2011 state taxes Certain annuity contracts. File 2011 state taxes   If an organization incurs an obligation to pay a charitable gift annuity, and the organization purchases an annuity contract to fund the obligation, individuals receiving payments under the charitable gift annuity will not be treated as indirect beneficiaries if the organization owns all of the incidents of ownership under the contract, is entitled to all payments under the contract, and the timing and amount of the payments are substantially the same as the timing and amount of payments to each person under the obligation (as such obligation is in effect at the time of the transfer). File 2011 state taxes Certain contracts held by a charitable remainder trust. File 2011 state taxes   An individual will not be considered an indirect beneficiary under a life insurance, annuity, or endowment contract held by a charitable remainder annuity trust or a charitable remainder unitrust solely by reason of being entitled to the payment if the trust owns all of the incidents of ownership under the contract, and the trust is entitled to all payments under the contract. File 2011 state taxes Excise tax. File 2011 state taxes   If the premiums are paid in connection with a transfer for which a deduction is not allowable under the deduction denial rule, without regard to when the transfer to the charitable organization was made, an excise tax will be applied that is equal to the amount of the premiums paid by the organization on any life insurance, annuity, or endowment contract. File 2011 state taxes The excise tax does not apply if all of the direct and indirect beneficiaries under the contract are organizations. File 2011 state taxes Excise Taxes. File 2011 state taxes   A charitable organization liable for excise taxes must file Form 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code. File 2011 state taxes Generally, the due date for filing Form 4720 occurs on the fifteenth day of the fifth month following the close of the organization's tax year. File 2011 state taxes Indoor tanning services. File 2011 state taxes   If your organization provides an indoor tanning bed service, the ACA imposed a 10% excise tax on services provided after June 30, 2010. File 2011 state taxes For more information, go to IRS. File 2011 state taxes gov and select Affordable Care Act Tax Provisions. File 2011 state taxes Application for Recognition of Exemption This discussion describes certain information to be provided upon application for recognition of exemption by all organizations created for any of the purposes described earlier in this chapter. File 2011 state taxes For example, the application must include a conformed copy of the organization's articles of incorporation, as discussed under Articles of Organization , later in this chapter. File 2011 state taxes See the organization headings that follow for specific information your organization may need to provide. File 2011 state taxes Form 1023. File 2011 state taxes   Your organization must file its application for recognition of exemption on Form 1023. File 2011 state taxes See chapter 1 and the instructions accompanying Form 1023 for the procedures to follow in applying. File 2011 state taxes Some organizations are not required to file Form 1023. File 2011 state taxes See Organizations Not Required To File Form 1023, later. File 2011 state taxes    Additional information to help you complete your application can be found online. File 2011 state taxes Go to Exemption Requirement – Section 501(c)(3) Organizations and select the link at the bottom of the Web page for step by step help with the application process. File 2011 state taxes See Exemption Requirements - Section 501(c)(3) Organizations. File 2011 state taxes   Form 1023 and accompanying statements must show that all of the following are true. File 2011 state taxes The organization is organized exclusively for, and will be operated exclusively for, one or more of the purposes (religious, charitable, etc. File 2011 state taxes ) specified in the introduction to this chapter. File 2011 state taxes No part of the organization's net earnings will inure to the benefit of private shareholders or individuals. File 2011 state taxes You must establish that your organization will not be organized or operated for the benefit of private interests, such as the creator or the creator's family, shareholders of the organization, other designated individuals, or persons controlled directly or indirectly by such private interests. File 2011 state taxes The organization will not, as a substantial part of its activities, attempt to influence legislation (unless it elects to come under the provisions allowing certain lobbying expenditures) or participate to any extent in a political campaign for or against any candidate for public office. File 2011 state taxes See Political activity, next, and Lobbying Expenditures , near the end of this chapter. File 2011 state taxes Political activity. File 2011 state taxes   If any of the activities (whether or not substantial) of your organization consist of participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for public office, your organization will not qualify for tax-exempt status under section 501(c)(3). File 2011 state taxes Such participation or intervention includes the publishing or distributing of statements. File 2011 state taxes   Whether your organization is participating or intervening, directly or indirectly, in any political campaign on behalf of (or in opposition to) any candidate for public office depends upon all of the facts and circumstances of each case. File 2011 state taxes Certain voter education activities or public forums conducted in a nonpartisan manner may not be prohibited political activity under section 501(c)(3), while other so-called voter education activities may be prohibited. File 2011 state taxes Effective date of exemption. File 2011 state taxes   Most organizations described in this chapter that were organized after October 9, 1969, will not be treated as tax exempt unless they apply for recognition of exemption by filing Form 1023. File 2011 state taxes These organizations will not be treated as tax exempt for any period before they file Form 1023, unless they file the form within 27 months from the end of the month in which they were organized. File 2011 state taxes If the organization files the application within this 27-month period, the organization's exemption will be recognized retroactively to the date it was organized. File 2011 state taxes Otherwise, exemption will be recognized only from the date of receipt. File 2011 state taxes The date of receipt is the date of the U. File 2011 state taxes S. File 2011 state taxes postmark on the cover in which an exemption application is mailed or, if no postmark appears on the cover, the date the application is stamped as received by the IRS. File 2011 state taxes Private delivery service. File 2011 state taxes   If a private delivery service designated by the IRS, rather than the U. File 2011 state taxes S. File 2011 state taxes Postal Service, is used to deliver the application, the date of receipt is the date recorded or marked by the private delivery service. File 2011 state taxes The following private delivery services have been designated by the IRS. File 2011 state taxes DHL Express (DHL): DHL “Same Day” Service. File 2011 state taxes Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First. File 2011 state taxes United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. File 2011 state taxes M. File 2011 state taxes , UPS Worldwide Express Plus, and UPS Worldwide Express. File 2011 state taxes Amendments to organizing documents required. File 2011 state taxes   If an organization is required to alter its activities or to make substantive amendments to its organizing document, the ruling or determination letter recognizing its exempt status will be effective as of the date the changes are made. File 2011 state taxes If only a nonsubstantive amendment is made, exempt status will be effective as of the date it was organized, if the application was filed within the 15-month period, or the date the application was filed. File 2011 state taxes Extensions of time for filing. File 2011 state taxes   There are two ways organizations seeking exemption can receive an extension of time for filing Form 1023. File 2011 state taxes Automatic 12-month extension. File 2011 state taxes Organizations will receive an automatic 12-month extension if they file an application for recognition of exemption with the IRS within 12 months of the original deadline. File 2011 state taxes To get this extension, an organization must add the following statement at the top of its application: “Filed Pursuant to Section 301. File 2011 state taxes 9100-2. File 2011 state taxes ” Discretionary extensions. File 2011 state taxes An organization that fails to file a Form 1023 within the extended 12-month period will be granted an extension to file if it submits evidence (including affidavits) to establish that: It acted reasonably and in good faith, and Granting a discretionary extension will not prejudice the interests of the government. File 2011 state taxes How to show reasonable action and good faith. File 2011 state taxes   An organization acted reasonably and showed good faith if at least one of the following is true. File 2011 state taxes The organization requests relief before its failure to file is discovered by the IRS. File 2011 state taxes The organization failed to file because of intervening events beyond its control. File 2011 state taxes The organization exercised reasonable diligence (taking into account the complexity of the return or issue and the organization's experience in these matters) but was not aware of the filing requirement. File 2011 state taxes The organization reasonably relied upon the written advice of the IRS. File 2011 state taxes The organization reasonably relied upon the advice of a qualified tax professional who failed to file or advise the organization to file Form 1023. File 2011 state taxes An organization cannot rely on the advice of a tax professional if it knows or should know that he or she is not competent to render advice on filing exemption applications or is not aware of all the relevant facts. File 2011 state taxes Not acting reasonably and in good faith. File 2011 state taxes   An organization has not acted reasonably and in good faith under the following circumstances. File 2011 state taxes It seeks to change a return position for which an accuracy-related penalty has been or could be imposed at the time the relief is requested. File 2011 state taxes It was informed of the requirement to file and related tax consequences, but chose not to file. File 2011 state taxes It uses hindsight in requesting relief. File 2011 state taxes The IRS will not ordinarily grant an extension if specific facts have changed since the due date that makes filing an application advantageous to an organization. File 2011 state taxes Prejudicing the interest of the Government. File 2011 state taxes   Prejudice to the interest of the Government results if granting an extension of time to file to an organization results in a lower total tax liability for the years to which the filing applies than would have been the case if the organization had filed on time. File 2011 state taxes Before granting an extension, the IRS can require the organization requesting it to submit a statement from an independent auditor certifying that no prejudice will result if the extension is granted. File 2011 state taxes The interests of the Government are ordinarily prejudiced if the tax year in which the application should have been filed (or any tax year that would have been affected had the filing been timely) are closed by the statute of limitations before relief is granted. File 2011 state taxes The IRS can condition a grant of relief on the organization providing the IRS with a statement from an independent auditor certifying that the interests of the Government are not prejudiced. File 2011 state taxes Procedure for requesting extension. File 2011 state taxes   To request a discretionary extension, an organization must submit (to the IRS address shown on Form 1023 and Notice 1382) the following. File 2011 state taxes A statement showing the date Form 1023 was required to have been filed and the date it was actually filed. File 2011 state taxes Any documents relevant to the application. File 2011 state taxes An affidavit describing in detail the events that led to the failure to apply and to the discovery of that failure. File 2011 state taxes If the organization relied on a tax professional's advice, the affidavit must describe the engagement and responsibilities of the professional and the extent to which the organization relied on him or her. File 2011 state taxes This affidavit must be accompanied by a dated declaration, signed by an individual who has personal knowledge of the facts and circumstances, who is authorized to act for the organization, which states, “Under penalties of perjury, I declare that I have examined this request, including accompanying documents, and, to the best of my knowledge and belief, the request contains all the relevant facts relating to the request, and such facts are true, correct, and complete. File 2011 state taxes ” Detailed affidavits from individuals having knowledge or information about the events that led to the failure to make the application and to the discovery of that failure. File 2011 state taxes This includes the organization's return preparer, and any accountant or attorney, knowledgeable in tax matters, who advised the taxpayer on the application. File 2011 state taxes The affidavits must describe the engagement and responsibilities of the individual and the advice that he or she provided. File 2011 state taxes These affidavits must include the name, current address, and taxpayer identification number of the individual, and be accompanied by a dated declaration, signed by the individual, which states: “Under penalties of perjury, I declare that I have examined this request, including accompanying documents, and, to the best of my knowledge and belief, the request contains all the relevant facts relating to the request, and such facts are true, correct, and complete. File 2011 state taxes ” The organization must state whether the returns for the tax year in which the application should have been filed or any tax years that would have been affected by the application had it been timely made are being examined by the IRS, an appeals office, or a federal court. File 2011 state taxes The organization must notify the IRS office considering the request for relief if the IRS starts an examination of any such return while the organization's request for relief is pending. File 2011 state taxes The organization, if requested, has to submit copies of its tax returns, and copies of the returns of other affected taxpayers. File 2011 state taxes   A request for this relief in connection with an application for exemption does not require payment of an additional user fee. File 2011 state taxes Also, a request for relief under the automatic 12-month extension does not require payment of a user fee. File 2011 state taxes More information. File 2011 state taxes   For more information about these procedures, see Regulations sections 301. File 2011 state taxes 9100-1, 301. File 2011 state taxes 9100-2, 301. File 2011 state taxes 9100-3, Revenue Procedure 2013-4, section 6. File 2011 state taxes 04, 2013-1 I. File 2011 state taxes R. File 2011 state taxes B. File 2011 state taxes 126, and Revenue Procedure 2013-8, 2013-1 I. File 2011 state taxes R. File 2011 state taxes B. File 2011 state taxes 237. File 2011 state taxes See Revenue Procedure 2013-4 and Revenue Procedure 2013-8. File 2011 state taxes Notification from the IRS. File 2011 state taxes   Organizations filing Form 1023 and satisfying all requirements of section 501(c)(3) will be notified of their exempt status in writing. File 2011 state taxes Organizations Not Required To File Form 1023 Some organizations are not required to file Form 1023. File 2011 state taxes These include: Churches, interchurch organizations of local units of a church, conventions or associations of churches, or integrated auxiliaries of a church, such as a men's or women's organization, religious school, mission society, or youth group. File 2011 state taxes Any organization (other than a private foundation) normally having annual gross receipts of not more than $5,000 (see Gross receipts test, later). File 2011 state taxes These organizations are exempt automatically if they meet the requirements of section 501(c)(3). File 2011 state taxes Filing Form 1023 to establish exemption. File 2011 state taxes   If the organization wants to establish its exemption with the IRS and receive a ruling or determination letter recognizing its exempt status, it should file Form 1023. File 2011 state taxes By establishing its exemption, potential contributors are assured by the IRS that contributions will be deductible. File 2011 state taxes A subordinate organization (other than a private foundation) covered by a group exemption letter does not have to submit a Form 1023 for itself. File 2011 state taxes Private foundations. File 2011 state taxes   See Private Foundations and Public Charities, later in this chapter, for more information about the additional notice required from an organization in order for it not to be presumed to be a private foundation and for the additional information required from a private foundation claiming to be an operating foundation. File 2011 state taxes Gross receipts test. File 2011 state taxes   For purposes of the gross receipts test, an organization normally does not have more than $5,000 annually in gross receipts if: During its first tax year the organization received gross receipts of $7,500 or less, During its first 2 years the organization had a total of $12,000 or less in gross receipts, and In the case of an organization that has been in existence for at least 3 years, the total gross receipts received by the organization during the immediately preceding 2 years, plus the current year, are $15,000 or less. File 2011 state taxes   An organization with gross receipts more than the amounts in the gross receipts test, unless otherwise exempt from filing Form 1023, must file a Form 1023 within 90 days after the end of the period in which the amounts are exceeded. File 2011 state taxes For example, an organization's gross receipts for its first tax year were less than $7,500, but at the end of its second tax year its gross receipts for the 2-year period were more than $12,000. File 2011 state taxes The organization must file Form 1023 within 90 days after the end of its second tax year. File 2011 state taxes   If the organization had existed for at least 3 tax years and had met the gross receipts test for all prior tax years but fails to meet the requirement for the current tax year, its tax-exempt status for the prior years will not be lost even if Form 1023 is not filed within 90 days after the close of the current tax year. File 2011 state taxes However, the organization will not be treated as a section 501(c)(3) organization for the period beginning with the current tax year and ending with the filing of Form 1023. File 2011 state taxes Example. File 2011 state taxes   An organization is organized and operated exclusively for charitable purposes and is not a private foundation. File 2011 state taxes It was incorporated on January 1, 2009, and files returns on a calendar-year basis. File 2011 state taxes It did not file a Form 1023. File 2011 state taxes The organization's gross receipts during the years 2009 through 2012 were as follows: 2009 $3,600 2010 2,900 2011 400 2012 12,600   The organization's total gross receipts for 2009, 2010, and 2011 were $6,900. File 2011 state taxes Therefore, it did not have to file Form 1023 and is exempt for those years. File 2011 state taxes However, for 2010, 2011, and 2012 the total gross receipts were $15,900. File 2011 state taxes Therefore, the organization must file Form 1023 within 90 days after the end of its 2012 tax year. File 2011 state taxes If it does not file within this time period, it will not be exempt under section 501(c)(3) for the period beginning with tax year 2012 ending when the Form 1023 is received by the IRS. File 2011 state taxes The organization, however, will not lose its exempt status for the tax years ending before January 1, 2012. File 2011 state taxes   The IRS will consider applying the Commissioner's discretionary authority to extend the time for filing Form 1023. File 2011 state taxes See the procedures for this extension discussed earlier. File 2011 state taxes Articles of Organization Your organization must include a conformed copy of its articles of organization with the application for recognition of exemption. File 2011 state taxes This may be its trust instrument, corporate charter, articles of association, or any other written instrument by which it is created. File 2011 state taxes Organizational Test The articles of organization must limit the organization's purposes to one or more of those described at the beginning of this chapter and must not expressly empower it to engage, other than as an insubstantial part of its activities, in activities that do not further one or more of those purposes. File 2011 state taxes These conditions for exemption are referred to as the organizational test. File 2011 state taxes Section 501(c)(3) is the provision of law that grants exemption to the organizations described in this chapter. File 2011 state taxes Therefore, the organizational test may be met if the purposes stated in the articles of organization are limited in some way by reference to section 501(c)(3). File 2011 state taxes The requirement that your organization's purposes and powers must be limited by the articles of organization is not satisfied if the limit is contained only in the bylaws or other rules or regulations. File 2011 state taxes Moreover, the organizational test is not satisfied by statements of your organization's officers that you intend to operate only for exempt purposes. File 2011 state taxes Also, the test is not satisfied by the fact that your actual operations are for exempt purposes. File 2011 state taxes In interpreting an organization's articles, the law of the state where the organization was created is controlling. File 2011 state taxes If an organization contends that the terms of its articles have a different meaning under state law than their generally accepted meaning, such meaning must be established by a clear and convincing reference to relevant court decisions, opinions of the state attorney general, or other appropriate state authorities. File 2011 state taxes The following are examples illustrating the organizational test. File 2011 state taxes Example 1. File 2011 state taxes Articles of organization state that an organization is formed exclusively for literary and scientific purposes within the meaning of section 501(c)(3). File 2011 state taxes These articles appropriately limit the organization's purposes. File 2011 state taxes The organization meets the organizational test. File 2011 state taxes Example 2. File 2011 state taxes An organization, by the terms of its articles, is formed to engage in research without any further description or limitation. File 2011 state taxes The organization will not be properly limited as to its purposes since all research is not scientific. File 2011 state taxes The organization does not meet the organizational test. File 2011 state taxes Example 3. File 2011 state taxes An organization's articles state that its purpose is to receive contributions and pay them over to organizations that are described in section 501(c)(3) and exempt from taxation under section 501(a). File 2011 state taxes The organization meets the organizational test. File 2011 state taxes Example 4. File 2011 state taxes If a stated purpose in the articles is the conduct of a school of adult education and its manner of operation is described in detail, such a purpose will be satisfactorily limited. File 2011 state taxes Example 5. File 2011 state taxes If the articles state the organization is formed for charitable purposes, without any further description, such language ordinarily will be sufficient since the term charitable has a generally accepted legal meaning. File 2011 state taxes On the other hand, if the purposes are stated to be charitable, philanthropic, and benevolent, the organizational requirement will not be met since the terms philanthropic and benevolent have no generally accepted legal meaning and, therefore, the stated purposes may, under the laws of the state, permit activities that are broader than those intended by the exemption law. File 2011 state taxes Example 6. File 2011 state taxes If the articles state an organization is formed to promote American ideals, or to foster the best interests of the people, or to further the common welfare and well-being of the community, without any limitation or provision restricting such purposes to accomplishment only in a charitable manner, the purposes will not be sufficiently limited. File 2011 state taxes Such purposes are vague and may be accomplished other than in an exempt manner. File 2011 state taxes Example 7. File 2011 state taxes A stated purpose to operate a hospital does not meet the organizational test since it is not necessarily charitable. File 2011 state taxes A hospital may or may not be exempt depending on the manner in which it is operated. File 2011 state taxes Example 8. File 2011 state taxes An organization that is expressly empowered by its articles to carry on social activities will not be sufficiently limited as to its power, even if its articles state that it is organized and will be operated exclusively for charitable purposes. File 2011 state taxes Dedication and Distribution of Assets Assets of an organization must be permanently dedicated to an exempt purpose. File 2011 state taxes This means that should an organization dissolve, its assets must be distributed for an exempt purpose described in this chapter, or to the Federal Government or to a state or local government for a public purpose. File 2011 state taxes If the assets could be distributed to members or private individuals or for any other purpose, the organizational test is not met. File 2011 state taxes Dedication. File 2011 state taxes   To establish that your organization's assets will be permanently dedicated to an exempt purpose, the articles of organization should contain a provision ensuring their distribution for an exempt purpose in the event of dissolution. File 2011 state taxes Although reliance can be placed upon state law to establish permanent dedication of assets for exempt purposes, your organization's application probably can be processed much more rapidly if its articles of organization include a provision ensuring permanent dedication of assets for exempt purposes. File 2011 state taxes Distribution. File 2011 state taxes   Revenue Procedure 82-2, 1982-1 C. File 2011 state taxes B. File 2011 state taxes 367, identifies the states and circumstances in which the IRS will not require an express provision for the distribution of assets upon dissolution in the articles of organization. File 2011 state taxes The procedure also provides a sample of an acceptable dissolution provision for organizations required to have one. File 2011 state taxes   If a named beneficiary is to be the distributee, it must be one that would qualify and would be exempt within the meaning of section 501(c)(3) at the time the dissolution takes place. File 2011 state taxes Since the named beneficiary at the time of dissolution may not be qualified, may not be in existence, or may be unwilling or unable to accept the assets of the dissolving organization, a provision should be made for distribution of the assets for one or more of the purposes specified in this chapter in the event of any such contingency. File 2011 state taxes Sample articles of organization. File 2011 state taxes   See sample articles of organization in the Appendix in the back of this publication. File 2011 state taxes Educational Organizations and Private Schools If your organization wants to obtain recognition of exemption as an educational organization, you must submit complete information as to how your organization carries on or plans to carry on its educational activities, such as by conducting a school, by panels, discussions, lectures, forums, radio and television programs, or through various cultural media such as museums, symphony orchestras, or art exhibits. File 2011 state taxes In each instance, you must explain by whom and where these activities are or will be conducted and the amount of admission fees, if any. File 2011 state taxes You must submit a copy of the pertinent contracts, agreements, publications, programs, etc. File 2011 state taxes If you are organized to conduct a school, you must submit full information regarding your tuition charges, number of faculty members, number of full-time and part-time students enrolled, courses of study and degrees conferred, together with a copy of your school catalog. File 2011 state taxes See also Private Schools , discussed later. File 2011 state taxes Educational Organizations The term educational relates to: The instruction or training of individuals for the purpose of improving or developing their capabilities, or The instruction of the public on subjects useful to individuals and beneficial to the community. File 2011 state taxes Advocacy of a position. File 2011 state taxes   Advocacy of a particular position or viewpoint may be educational if there is a sufficiently full and fair exposition of pertinent facts to permit an individual or the public to form an independent opinion or conclusion. File 2011 state taxes The mere presentation of unsupported opinion is not educational. File 2011 state taxes Method not educational. File 2011 state taxes   The method used by an organization to develop and present its views is a factor in determining if an organization qualifies as educational within the meaning of section 501(c)(3). File 2011 state taxes The following factors may indicate that the method is not educational. File 2011 state taxes The presentation of viewpoints unsupported by facts is a significant part of the organization's communications. File 2011 state taxes The facts that purport to support the viewpoint are distorted. File 2011 state taxes The organization's presentations make substantial use of inflammatory and disparaging terms and express conclusions more on the basis of emotion than of objective evaluations. File 2011 state taxes The approach used is not aimed at developing an understanding on the part of the audience because it does not consider their background or training. File 2011 state taxes   Exceptional circumstances, however, may exist where an organization's advocacy may be educational even if one or more of the factors listed above are present. File 2011 state taxes Qualifying organizations. File 2011 state taxes   The following types of organizations may qualify as educational: An organization, such as a primary or secondary school, a college, or a professional or trade school, that has a regularly scheduled curriculum, a regular faculty, and a regularly enrolled student body in attendance at a place where the educational activities are regularly carried on, An organization whose activities consist of conducting public discussion groups, forums, panels, lectures, or other similar programs, An organization that presents a course of instruction by correspondence or through the use of television or radio, A museum, zoo, planetarium, symphony orchestra, or other similar organization, A nonprofit children's day-care center, and A credit counseling organization. File 2011 state taxes College book stores, cafeterias, restaurants, etc. File 2011 state taxes   These and other on-campus organizations should submit information to show that they are controlled by and operated for the convenience of the faculty and student body or by whom they are controlled and whom they serve. File 2011 state taxes Alumni association. File 2011 state taxes   An alumni association should establish that it is organized to promote the welfare of the university with which it is affiliated, is subject to the control of the university as to its policies and destination of funds, and is operated as an integral part of the university or is otherwise organized to promote the welfare of the college or university. File 2011 state taxes If your association does not have these characteristics, it may still be exempt as a social club if it meets the requirements described in chapter 4, under 501(c)(7) - Social and Recreation Clubs . File 2011 state taxes Athletic organization. File 2011 state taxes   This type of organization must submit evidence that it is engaged in activities such as directing and controlling interscholastic athletic competitions, conducting tournaments, and prescribing eligibility rules for contestants. File 2011 state taxes If it is not so engaged, your organization may be exempt as a social club described in chapter 4. File 2011 state taxes Raising funds to be used for travel and other activities to interview and persuade prospective students with outstanding athletic ability to attend a particular university does not show an exempt purpose. File 2011 state taxes If your organization is not exempt as an educational organization, see Amateur Athletic Organizations , later in this chapter. File 2011 state taxes Private Schools Every private school filing an application for recognition of tax-exempt status must supply the IRS (on Schedule B, Form 1023) with the following information. File 2011 state taxes The racial composition of the student body, and of the faculty and administrative staff, as of the current academic year. File 2011 state taxes (This information also must be projected, so far as may be feasible, for the next academic year. File 2011 state taxes ) The amount of scholarship and loan funds, if any, awarded to students enrolled and the racial composition of students who have received the awards. File 2011 state taxes A list of the school's incorporators, founders, board members, and donors of land or buildings, whether individuals or organizations. File 2011 state taxes A statement indicating whether any of the organizations described in item (3) above have an objective of maintaining segregated public or private school education at the time the application is filed and, if so, whether any of the individuals described in item (3) are officers or active members of those organizations at the time the application is filed. File 2011 state taxes The public school district and county in which the school is located. File 2011 state taxes How to determine racial composition. File 2011 state taxes   The racial composition of the student body, faculty, and administrative staff can be an estimate based on the best information readily available to the school, without requiring student applicants, students, faculty, or administrative staff to submit to the school information that the school otherwise does not require. File 2011 state taxes Nevertheless, a statement of the method by which the racial composition was determined must be supplied. File 2011 state taxes The identity of individual students or members of the faculty and administrative staff should not be included with this information. File 2011 state taxes   A school that is a state or municipal instrumentality (see Instrumentalities , near the beginning of this chapter), whether or not it qualifies for exemption under section 501(c)(3), is not considered to be a private school for purposes of the following discussion. File 2011 state taxes Racially Nondiscriminatory Policy To qualify as an organization exempt from federal income tax, a private school must include a statement in its charter, bylaws, or other governing instrument, or in a resolution of its governing body, that it has a racially nondiscriminatory policy as to students and that it does not discriminate against applicants and students on the basis of race, color, or national or ethnic origin. File 2011 state taxes Also, the school must circulate information that clearly states the school's admission policies. File 2011 state taxes A racially nondiscriminatory policy toward students means that the school admits the students of any race to all the rights, privileges, programs, and activities generally accorded or made available to students at that school and that the school does not discriminate on the basis of race in administering its educational policies, admission policies, scholarship and loan programs, and athletic and other school-administered programs. File 2011 state taxes The IRS considers discrimination on the basis of race to include discrimination on the basis of color or national or ethnic origin. File 2011 state taxes The existence of a racially discriminatory policy with respect to the employment of faculty and administrative staff is indicative of a racially discriminatory policy as to students. File 2011 state taxes Conversely, the absence of racial discrimination in the employment of faculty and administrative staff is indicative of a racially nondiscriminatory policy as to students. File 2011 state taxes A policy of a school that favors racial minority groups with respect to admissions, facilities and programs, and financial assistance is not discrimination on the basis of race when the purpose and effect of this policy is to promote establishing and maintaining the school's nondiscriminatory policy. File 2011 state taxes A school that selects students on the basis of membership in a religious denomination or unit is not discriminating if membership in the denomination or unit is open to all on a racially nondiscriminatory basis. File 2011 state taxes Policy statement. File 2011 state taxes   The school must include a statement of its racially nondiscriminatory policy in all its brochures and catalogs dealing with student admissions, programs, and scholarships. File 2011 state taxes Also, the school must include a reference to its racially nondiscriminatory policy in other written advertising that it uses to inform prospective students of its programs. File 2011 state taxes Publicity requirement. File 2011 state taxes   The school must make its racially nondiscriminatory policy known to all segments of the general community served by the school. File 2011 state taxes Selective communication of a racially nondiscriminatory policy that a school provides solely to leaders of racial groups will not be considered an effective means of communication to make the policy known to all segments of the community. File 2011 state taxes To satisfy this requirement, the school must use one of the following two methods. File 2011 state taxes Method one. File 2011 state taxes   The school can publish a notice of its racially nondiscriminatory policy in a newspaper of general circulation that serves all racial segments of the community. File 2011 state taxes Such publication must be repeated at least once annually during the period of the school's solicitation for students or, in the absence of a solicitation program, during the school's registration period. File 2011 state taxes When more than one community is served by a school, the school can publish the notice in those newspapers that are reasonably likely to be read by all racial segments in the communities that the school serves. File 2011 state taxes If this method is used, the notice must meet the following printing requirements. File 2011 state taxes It must appear in a section of the newspaper likely to be read by prospective students and their families. File 2011 state taxes It must occupy at least 3 column inches. File 2011 state taxes It must have its title printed in at least 12 point bold face type. File 2011 state taxes It must have the remaining text printed in at least 8 point type. File 2011 state taxes The following is an acceptable example of the notice:   NOTICE OF NONDISCRIMINATORY POLICY AS TO STUDENTS     The M School admits students of any race, color, national and ethnic origin to all the rights, privileges, programs, and activities generally accorded or made available to students at the school. File 2011 state taxes It does not discriminate on the basis of race, color, national and ethnic origin in administration of its educational policies, admissions policies, scholarship and loan programs, and athletic and other school-administered programs. File 2011 state taxes   Method two. File 2011 state taxes   The school can use the broadcast media to publicize its racially nondiscriminatory policy if this use makes the policy known to all segments of the general community the school serves. File 2011 state taxes If the school uses this method, it must provide documentation showing that the means by which this policy was communicated to all segments of the general community was reasonably expected to be effective. File 2011 state taxes In this case, appropriate documentation would include copies of the tapes or scripts used and records showing that there was an adequate number of announcements. File 2011 state taxes The documentation also would include proof that these announcements were made during hours when they were likely to be communicated to all segments of the general community, that they were long enough to convey the message clearly, and that they were broadcast on radio or television stations likely to be listened to by substantial numbers of members of all racial segments of the general community. File 2011 state taxes Announcements must be made during the period of the school's solicitation for students or, in the absence of a solicitation program, during the school's registration period. File 2011 state taxes Exceptions. File 2011 state taxes   The publicity requirements will not apply in the following situations. File 2011 state taxes First, if for the preceding 3 years the enrollment of a parochial or other church-related school consists of students at least 75% of whom are members of the sponsoring religious denomination or unit, the school can make known its racially nondiscriminatory policy in whatever newspapers or circulars the religious denomination or unit uses in the communities from which the students are drawn. File 2011 state taxes These newspapers and circulars can be distributed by a particular religious denomination or unit or by an association that represents a number of religious organizations of the same denomination. File 2011 state taxes If, however, the school advertises in newspapers of general circulation in the community or communities from which its students are drawn and the second exception (discussed next) does not apply to the school, then it must comply with either of the publicity requirements explained earlier. File 2011 state taxes Second, if a school customarily draws a substantial percentage of its students nationwide, worldwide, from a large geographic section or sections of the United States, or from local communities, and if the school follows a racially nondiscriminatory policy as to its students, the school may satisfy the publicity requirement by complying with the instructions explained earlier under Policy statement . File 2011 state taxes   The school can demonstrate that it follows a racially nondiscriminatory policy either by showing that it currently enrolls students of racial minority groups in meaningful numbers or, except for local community schools, when minority students are not enrolled in meaningful numbers, that its promotional activities and recruiting efforts in each geographic area were reasonably designed to inform students of all racial segments in the general communities within the area of the availability of the school. File 2011 state taxes The question as to whether a school demonstrates such a policy satisfactorily will be determined on the basis of the facts and circumstances of each case. File 2011 state taxes   The IRS recognizes that the failure by a school drawing its students from local communities to enroll racial minority group students may not necessarily indicate the absence of a racially nondiscriminatory policy when there are relatively few or no such students in these communities. File 2011 state taxes Actual enrollment is, however, a meaningful indication of a racially nondiscriminatory policy in a community in which a public school or schools became subject to a desegregation order of a federal court or are otherwise expressly obligated to implement a desegregation plan under the terms of any written contract or other commitment to which any federal agency was a party. File 2011 state taxes   The IRS encourages schools to satisfy the publicity requirement by using either of the methods described earlier, even though a school considers itself to be within one of the Exceptions. File 2011 state taxes The IRS believes that these publicity requirements are the most effective methods to make known a school's racially nondiscriminatory policy. File 2011 state taxes In this regard, it is each school's responsibility to determine whether either of the exceptions applies. File 2011 state taxes Such responsibility will prepare the school, if it is audited by the IRS, to demonstrate that the failure to publish its racially nondiscriminatory policy in accordance with either one of the publicity requirements was justified by one of the exceptions. File 2011 state taxes Also, a school must be prepared to demonstrate that it has publicly disavowed or repudiated any statements purported to have been made on its behalf (after November 6, 1975) that are contrary to its publicity of a racially nondiscriminatory policy as to students, to the extent that the school or its principal official was aware of these statements. File 2011 state taxes Facilities and programs. File 2011 state taxes   A school must be able to show that all of its programs and facilities are operated in a racially nondiscriminatory manner. File 2011 state taxes Scholarship and loan programs. File 2011 state taxes   As a general rule, all scholarship or other comparable benefits obtainable at the school must be offered on a racially nondiscriminatory basis. File 2011 state taxes This must be known throughout the general community being served by the school and should be referred to in its publicity. File 2011 state taxes Financial assistance programs, as well as scholarships and loans made under financial assistance programs, that favor members of one or more racial minority groups and that do not significantly detract from or are designed to promote a school's racially nondiscriminatory policy will not adversely affect the school's exempt status. File 2011 state taxes Certification. File 2011 state taxes   An individual authorized to take official action on behalf of a school that claims to be racially nondiscriminatory as to students must certify annually, under penalties of perjury, on Schedule E (Form 990 or 990-EZ) or Form 5578, Annual Certification of Racial Nondiscrimination for a Private School Exempt From Federal Income Tax, whichever applies, that to the best of his or her knowledge and belief the school has satisfied all requirements that apply, as previously explained. File 2011 state taxes   Failure to comply with the guidelines ordinarily will result in the proposed revocation of the exempt status of a school. File 2011 state taxes Recordkeeping requirements. File 2011 state taxes With certain exceptions, given later, each exempt private school must maintain the following records for a minimum period of 3 years, beginning with the year after the year of compilation or acquisition. File 2011 state taxes Records indicating the racial composition of the student body, faculty, and administrative staff for each academic year. File 2011 state taxes Records sufficient to document that scholarship and other financial assistance is awarded on a racially nondiscriminatory basis. File 2011 state taxes Copies of all materials used by or on behalf of the school to solicit contributions. File 2011 state taxes Copies of all brochures, catalogs, and advertising dealing with student admissions, programs, and scholarships. File 2011 state taxes (Schools advertising nationally or in a large geographic segment or segments of the United States need only maintain a record sufficient to indicate when and in what publications their advertisements were placed. File 2011 state taxes ) The racial composition of the student body, faculty, and administrative staff can be determined in the same manner as that described at the beginning of this section. File 2011 state taxes However, a school cannot discontinue maintaining a system of records that reflect the racial composition of its students, faculty, and administrative staff used on November 6, 1975, unless it substitutes a different system that compiles substantially the same information, without advance approval of the IRS. File 2011 state taxes The IRS does not require that a school release any personally identifiable records or personal information except in accordance with the requirements of the Family Educational Rights and Privacy Act of 1974. File 2011 state taxes Similarly, the IRS does not require a school to keep records prohibited under state or federal law. File 2011 state taxes Exceptions. File 2011 state taxes   The school does not have to independently maintain these records for IRS use if both of the following are true. File 2011 state taxes Substantially the same information has been included in a report or reports filed with an agency or agencies of federal, state, or local governments, and this information is current within 1 year. File 2011 state taxes The school maintains copies of these reports from which this information is readily obtainable. File 2011 state taxes If these reports do not include all of the information required, as discussed earlier, records providing such remaining information must be maintained by the school for IRS use. File 2011 state taxes Failure to maintain records. File 2011 state taxes   Failure to maintain or to produce the required records and information, upon proper request, will create a presumption that the organization has failed to comply with these guidelines. File 2011 state taxes Organizations Providing Insurance An organization described in sections 501(c)(3) or 501(c)(4) may be exempt from tax only if no substantial part of its activities consists of providing commercial-type insurance. File 2011 state taxes However, this rule does not apply to state-sponsored organizations described in sections 501(c)(26) or 501(c)(27), which are discussed in chapter 4, or to charitable risk pools, discussed next. File 2011 state taxes Charitable Risk Pools A charitable risk pool is treated as organized and operated exclusively for charitable purposes if it: Is organized and operated only to pool insurable risks of its members (not including risks related to medical malpractice) and to provide information to its members about loss control and risk management, Consists only of members that are section 501(c)(3) organizations exempt from tax under section 501(a), Is organized under state law authorizing this type of risk pooling, Is exempt from state income tax (or will be after qualifying as a section 501(c)(3) organization), Has obtained at least $1,000,000 in startup capital from nonmember charitable organizations, Is controlled by a board of directors elected by its members, and Is organized under documents requiring that: Each member be a section 501(c)(3) organization exempt from tax under section 501(a), Each member that receives a final determination that it no longer qualifies under section 501(c)(3) notify the pool immediately, and Each insurance policy issued by the pool provide that it will not cover events occurring after a final determination described in (b). File 2011 state taxes Other Section 501(c)(3) Organizations In addition to the information required for all organizations, as described earlier, you should include any other information described in this section. File 2011 state taxes Charitable Organizations If your organization is applying for recognition of exemption as a charitable organization, it must show that it is organized and operated for purposes that are beneficial to the public interest. File 2011 state taxes Some examples of this type of organization are those organized for: Relief of the poor, the distressed, or the underprivileged, Advancement of religion, Advancement of education or science, Erection or maintenance of public buildings, monuments, or works, Lessening the burdens of government, Lessening of neighborhood tensions, Elimination of prejudice and discrimination, Defense of human and civil rights secured by law, and Combating community deterioration and juvenile delinquency. File 2011 state taxes The rest of this section contains a description of the information to be provided by certain specific organizations. File 2011 state taxes This information is in addition to the required inclusions described in chapter 1, and other statements requested on Form 1023. File 2011 state taxes Each of the following organizations must submit the information described. File 2011 state taxes Charitable organization supporting education. File 2011 state taxes   Submit information showing how your organization supports education — for example, contributes to an existing educational institution, endows a professorial chair, contributes toward paying teachers' salaries, or contributes to an educational institution to enable it to carry on research. File 2011 state taxes Scholarships. File 2011 state taxes   If the organization awards or plans to award scholarships, complete Schedule H of Form 1023. File 2011 state taxes Also, submit the following: Criteria used for selecting recipients, including the rules of eligibility. File 2011 state taxes How and by whom the recipients are or will be selected. File 2011 state taxes If awards are or will be made directly to individuals, whether information is required assuring that the student remains in school. File 2011 state taxes If awards are or will be made to recipients of a particular class, for example, children of employees of a particular employer— Whether any preference is or will be accorded an applicant by reason of the parent's position, length of employment, or salary, Whether as a condition of the award the recipient must upon graduation accept employment with the company, and Whether the award will be continued even if the parent's employment ends. File 2011 state taxes A copy of the scholarship application form and any brochures or literature describing the scholarship program. File 2011 state taxes Hospital. File 2011 state taxes   If you are organized to operate a charitable hospital, complete and attach Section I of Schedule C, Form 1023. File 2011 state taxes   If your hospital was transferred to you from proprietary ownership, complete and attach Schedule G of Form 1023. File 2011 state taxes You must attach a list showing: The names of the active and courtesy staff members of the proprietary hospital, as well as the names of your medical staff members after the transfer to nonprofit ownership, and The names of any doctors who continued to lease office space in the hospital after its transfer to nonprofit ownership and the amount of rent paid. File 2011 state taxes Submit also an appraisal showing the fair rental value of the rented space. File 2011 state taxes Clinic. File 2011 state taxes   If you are organized to operate a clinic, attach a statement including: A description of the facilities and services, To whom the services are offered, such as the public at large or a specific group, How charges are determined, such as on a profit basis, to recover costs, or at less than cost, By whom administered and controlled, Whether any of the professional staff (that is, those who perform or will perform the clinical services) also serve or will serve in an administrative capacity, and How compensation paid the professional staff is or will be determined. File 2011 state taxes Home for the aged. File 2011 state taxes   If you are organized to operate a home for the aged, complete and attach Schedule F of Form 1023 and required attachments. File 2011 state taxes Community nursing bureau. File 2011 state taxes   If you provide a nursing register or community nursing bureau, provide information showing that your organization will be operated as a community project and will receive its primary support from public contributions to maintain a nonprofit register of qualified nursing personnel, including graduate nurses, unregistered nursing school graduates, licensed attendants and practical nurses for the benefit of hospitals, health agencies, doctors, and individuals. File 2011 state taxes Organization providing loans. File 2011 state taxes   If you make, or will make, loans for charitable and educational purposes, submit the following information. File 2011 state taxes An explanation of the circumstances under which such loans are, or will be, made. File 2011 state taxes Criteria for selection, including the rules of eligibility. File 2011 state taxes How and by whom the recipients are or will be selected. File 2011 state taxes Manner of repayment of the loan. File 2011 state taxes Security required, if any. File 2011 state taxes Interest charged, if any, and when payable. File 2011 state taxes Copies in duplicate of the loan application and any brochures or literature describing the loan program. File 2011 state taxes Public-interest law firms. File 2011 state taxes   If your organization was formed to litigate in the public interest (as opposed to providing legal services to the poor), such as in the area of protection of the environment, you should submit the following information. File 2011 state taxes How the litigation can reasonably be said to be representative of a broad public interest rather than a private one. File 2011 state taxes Whether the organization will accept fees for its services. File 2011 state taxes A description of the cases litigated or to be litigated and how they benefit the public generally. File 2011 state taxes Whether the policies and program of the organization are the responsibility of a board or committee representative of the public interest, which is neither controlled by employees or persons who litigate on behalf of the organization nor by any organization that is not itself an organization described in this chapter. File 2011 state taxes Whether the organization is operated, through sharing of office space or otherwise, in a way to create identification or confusion with a particular private law firm. File 2011 state taxes Whether there is an arrangement to provide, directly or indirectly, a deduction for the cost of litigation that is for the private benefit of the donor. File 2011 state taxes Acceptance of attorneys' fees. File 2011 state taxes   A nonprofit public-interest law firm can accept attorneys' fees in public-interest cases if the fees are paid directly by its clients and the fees are not more than the actual costs incurred in the case. File 2011 state taxes Upon undertaking a representation, the organization cannot withdraw from the case because the litigant is unable to pay the fee. File 2011 state taxes   Firms can accept fees awarded or approved by a court or an administrative agency and paid by an opposing party if the firms do not use the likelihood or probability of fee awards as a consideration in the selection of cases. File 2011 state taxes All fee awards must be paid to the organization and not to its individual staff attorneys. File 2011 state taxes Instead, a public-interest law firm can reasonably compensate its staff attorneys, but only on a straight salary basis. File 2011 state taxes Private attorneys, whose services are retained by the firm to assist it in particular cases, can be compensated by the firm, but only on a fixed fee or salary basis. File 2011 state taxes   The total amount of all attorneys' fees (court awarded and those received from clients) must not be more than 50% of the total cost of operations of the organization's legal functions, calculated over a 5-year period. File 2011 state taxes   If, in order to carry out its program, an organization violates applicable canons of ethics, disrupts the judicial system, or engages in any illegal action, the organization will jeopardize its exemption. File 2011 state taxes Religious Organizations To determine whether an organization meets the religious purposes test of section 501(c)(3), the IRS maintains two basic guidelines. File 2011 state taxes That the particular religious beliefs of the organization are truly and sincerely held. File 2011 state taxes That the practices and rituals associated with the organization's religious belief or creed are not illegal or contrary to clearly defined public policy. File 2011 state taxes Therefore, your group (or organization) may not qualify for treatment as an exempt religious organization for tax purposes if its actions, as contrasted with its beliefs, are contrary to well established and clearly defined public policy. File 2011 state taxes If there is a clear showing that the beliefs (or doctrines) are sincerely held by those professing them, the IRS will not question the religious nature of those beliefs. File 2011 state taxes Churches. File 2011 state taxes   Although a church, its integrated auxiliaries, or a convention or association of churches is not required to file Form 1023 to be exempt from federal income tax or to receive tax deductible contributions, the organization may find it advantageous to obtain recognition of exemption. File 2011 state taxes In this event, you should submit information showing that your organization is a church, synagogue, association or convention of churches, religious order, or religious organization that is an integral part of a church, and that it is engaged in carrying out the function of a church. File 2011 state taxes   In determining whether an admittedly religious organization is also a church, the IRS does not accept every assertion that the organization is a church. File 2011 state taxes Because beliefs and practices vary so widely, there is no single definition of the word church for tax purposes. File 2011 state taxes The IRS considers the facts and circumstances of each organization applying for church status. File 2011 state taxes Convention or association of churches. File 2011 state taxes   Any organization that is otherwise a convention or association of churches will not fail to qualify as a church merely because the membership of the organization includes individuals as well as churches or because the individuals have voting rights in the organization. File 2011 state taxes Integrated auxiliaries. File 2011 state taxes   An organization is an integrated auxiliary of a church if all the following are true. File 2011 state taxes The organization is described both in sections 501(c)(3) and 509(a)(1), 509(a)(2), or 509(a)(3). File 2011 state taxes It is affiliated with a church or a convention or association of churches. File 2011 state taxes It is internally supported. File 2011 state taxes An organization is internally supported unless both of the following are true. File 2011 state taxes It offers admissions, goods, services, or facilities for sale, other than on an incidental basis, to the general public (except goods, services, or facilities sold at a nominal charge or for a small part of the cost). File 2011 state taxes It normally gets more than 50% of its support from a combination of governmental sources, public solicitation of contributions, and receipts from the sale of admissions, goods, performance of services, or furnishing of facilities in activities that are not unrelated trades or businesses. File 2011 state taxes Special rule. File 2011 state taxes   Men's and women's organizations, seminaries, mission societies, and youth groups that satisfy (1) and (2) shown earlier are integrated auxiliaries of a church even if they are not internally supported. File 2011 state taxes   In order for an organization (including a church and religious organization) to qualify for tax exemption, no part of its net earnings can inure to any individual. File 2011 state taxes   Although an individual is entitled to a charitable deduction for contributions to a church, the assignment or similar transfer of compensation for personal services to a church generally does not relieve a taxpayer of federal income tax liability on the compensation, regardless of the motivation behind the transfer. File 2011 state taxes Scientific Organizations You must show that your organization's research will be carried on in the public interest. File 2011 state taxes Scientific research will be considered to be in the public interest if the results of the research (including any patents, copyrights, processes, or formulas) are made available to the public on a nondiscriminatory basis; if the research is performed for the United States or a state, county, or municipal government; or if the research is carried on for one of the following purposes. File 2011 state taxes Aiding in the scientific education of college or university students. File 2011 state taxes Obtaining scientific information that is published in a treatise, thesis, trade publication, or in any other form th