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Applying for Non-profit status in ArizonaDate: June 8, 2012 by Jack Weldon  Views: 1724
Comrades.
I am applying for 501(c)3 status for my choir and I'm confused about something. I know most community choruses are 501(c)3's so here's my question:
What "heading/purpose" do we fall under exactly? By process of elimination I've whittled it down to Charitable and/or Educational. (I was originally thinking it might be for "The Prevention of Cruelty to Children" but from what I've heard about how some choirs are run I don't think that can be it.)
Does anyone have experience with this? If so, can you help me understand how you answered when you applied and how you justified that distinction. If we're Charitable, who are we giving to? If we're Educational, who and how are we educating? Any help would be greatly appreciated!
Thanks in advance.
Jack W.
Frank Albinder on June 11, 2012 7:34am
We're a charitable 501(c)3. We don't give charity (though some choruses do)--we get it when people make contributions. :-) You could make a case for applying as an educational entity (if your chorus existed only to sing in schools, for example), but that category is generally for not-for-profit schools. Here's the wording from the IRS exemption letter for one of my choruses:
"Organizations exempt under section 501 (c) 3 of the Code are further classified as either public charities or private foundations. We determined that you are a public charity under the Code section(s) listed in the heading of this letter."
In the heading of the letter, it says:
Public Charity Status 509(a) 2
on June 11, 2012 9:06am
Here are the "Exempt Purposes" as defined by the IRS, plus a couple of good websites that can answer many questions about applying for nonprofit, tax exempt status:
Page Last Reviewed or Updated: January 10, 2012
There has been, and still is, much public debate about the proliferation of tax-exempt nonprofits that do not appear to meet tax-exempt requirements even though they have been granted 501(C)(3) status. One way that community choirs can better and more clearly meet the requirements and also insulate themselves from negative public opinion is if they offer at least one free public concert per year for those who would otherwise be unable to afford tickets, contain some spinoff groups of fewer singers who perform for free in nursing homes, schools, hospitals, etc., waive participation fees for singers who wish to become choir members but who cannot afford the cost, etc. For an organization to be deemed "charitable" it must truly be charitable to some people, and the more people that can receive the "charity," the better. For an organization to be deemed "educational" it must truly be educational, again for a large enough group of people in the area.
If I remember history correctly, the ORIGINAL intent of those who created federal tax-exemptions was to encourage the formation of organizations that would relieve the government of some functions and the costs of those functions. The tax-exempt organization is not required to pay federal tax because it was and still is assumed that the organization would provide at least as much social benefit as the taxes they would otherwise pay would have provided.
Hope this all provides a little clarity.
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