Dear Ministry,

Are these some of your questions?

What are valid 501(c)(3) Tax Exempt Ministry purposes? What are advance and definitive rulings? What activities may a 501(c)(3) non-profit Ministry corporation engage in under federal law? How do you qualify for 501(c)(3) public charity status? What are the public support tests? And so on and so on...

501(c)(3) Tax Exempt rules can be very confusing!

WARNING! Unless you and your accountant or lawyer are preparing 501(c)(3) applications on a daily basis, I would think twice before engaging any one to do this. (Ask for references) If done improperly you can delay the process up to 9 months, obtain an adverse determination letter and even lose your user fee. We receive many attempted applications with adverse "90 day" determination letters from lawyers, accountants and amateur people. They cry HELP!

Don't let this be you.

Below, we have provided a brief summary of the IRS 501(c)(3) application process.

501(c)(3) Tax Exempt Status

The only way to establish a bonified tax exempt recognition with the IRS and the community is to apply for and must be granted the exempt status under the section 501(c)(3) of the IRS code. However, the IRS establishes a number of overriding restrictions and limitations that apply to your Church. Meeting these rules is critical to qualifying for and maintaining your non-profit tax-exempt status. These laws are complex.

We will prepare the 501(c)(3) tax-exempt application and all schedules, affidavits, forms, detailed financial statements, (revenue and expenses and proposed budgets for 2 years) and attachments for you and make sure that you will met all legal and technical requirements needed for the 501(c)(3) status.

For example, we will make sure you'll meet the organizational test for exemption, which includes amending your Articles of Incorporation. Our Experience shows that 90 percent of the Articles of Incorporation we receive needs to be amended before submitting to IRS

We will also prepare all of your internal rules of operation. These rules are subordinate to the organization's charter and make provisions for the qualification of its membership, their voting rights, election of its board of directors & officers, duties of board members and officers, terms of office, meetings, dues and assessments, if any.

We will be with you all the way until you get your 501(c)(3) and of course afterwards for compliance.

Process

Upon receipt of the completed application and attachments the Internal Revenue Service will send you a Letter of Acknowledgment of your request and assign a document locator number. Technically they have up to 120 days to respond.

We will have you sign a limited power of attorney and Declaration of Representative Form 2848 this will enable us to correspond with the "Exempt Organization Specialist" that will be assigned to your case. Applications are handled and approved on a case by case basis.

This specialist will go over the entire application and attachments, in which it can take up to four months to finish the process. During this time we will correspond with the agent and make sure you meet all the technical and legal requirements. Because of our Excellent, thorough work and professional relationship with the IRS we have been receiving 501(c)(3) status for our clients on an average of 60 days!

According to the IRS not all organizations will receive a favorable determination letter. We will make sure you will receive your 501(c)(3) and will money back guarantee it.

What happens next?

After the technical review, which can take up to 4 months, you will receive a "determination letter" (this is your 501(c)(3) status) direct from the Director of Exempt Organizations. This letter will state that you are exempt from federal income taxes under section 501(c)(3). Churches receive Definitive Rulings under section 170(b)(1)(A)(i) Note! The IRS does not give 501(c)(3) identification numbers. This exemption will be retro active to the date of incorporation, which means any contributions you receive since you have been incorporated will be fully tax deductible.

Your letter is important as it shows to your grantors and contributors and the public that you are indeed a 501(c)(3) organization. The letter will also spell out restrictions and conditions that apply if you are to remain tax-exempt under sec. 501(c)(3). Moreover, the letter will address your Information and Annual Reporting Requirements to IRS.

Advance Ruling and Definitive Ruling

If you have completed a closed accounting period of at least 8 months you are eligible for a Definitive Ruling . If not, the IRS will give you an Advance Ruling and will not make a final determination until your advance ruling period ends which is usually 4 years after you receive the first 501(c)(3) determination letter. During this time the IRS will look to see if your organization will meet the attraction of public support factors [under IRC Sections 509(a)(1) and 170(b)(1)(A)(vi)] and/or the support test [under IRC section 509(a)(2)].

INCLUDED AT NO EXTRA CHARGE!
YOUR STATE TAX EXEMPTION AND NON-PROFIT REGISTRATION

State Tax Exemption

If your State has Solicitation Registration Regulations, we will also register your organization with your State. All charitable organizations must register with the state prior to engaging in solicitation activities. (Please see your individual state requirement) and renew annually thereafter. We will register your organization with the State and inform you of this disclosure requirement.

Sales Tax Exemption

Exemption from State Sales Tax is granted only to non-profit organizations that meet the criteria set forth in State Sales Tax Section in your State Statutes. We will prepare your application for "Sales Tax Consumer's Certificate of Exemption."

Director/Officer Immunity

Subject to the provisions of your State Immunity Statute: We will also include an indemnification agreement indemnifying all your directors and officers of the organization.

IRS Contributions Substantiation and Disclosure Requirements

Under the new law, section 170 and new section 6615 of the Internal Revenue Code, Churches will need to provide new kinds of information to donors. Thus, taxpayers may no longer rely solely on a canceled check for deductions. Failure to do so may result in denial of deductions to donors and the imposition of penalties on non-profits. To help comply with this law, we will provide you with IRS-compliant forms (as templates with your letterhead on top) to copy and to give out to your donors and contributors.

Internal Revenue Service (IRS) Application User Fee

Internal Revenue Service (IRS) requires a payment of a one time "user fee" with each application for a 501(c)(3) determination letter. A new organization that anticipates gross receipts averaging NOT more than $10,000 during its first 4 years (NOT more than $ 40,000.00 combined annual gross income for the first four years) the Fee is $300.00

A new organization that anticipates gross receipts averaging MORE than $10,000 during its first 4 years (more than $ 40,000.00 combined annual gross income for the first four years) Fee $750.00

If you are an existing organization with an average of more than $10,000.00 annual gross receipts during the preceding years fee is $750.00. This fee is separate from our professional fees. (Do not send us the IRS check)

We look forward to working with you to ensure that your organization is safeguarded through IRS exemption recognition and becomes an organization recognized by the IRS as exempt from federal (and state) income taxes, and eligible to receive tax deductible contributions from its donors and supporters, as well as Federal and State grants.

Please pray about it and if you have any more questions or requests regarding the above please don't hesitate to give us a TOLL-FREE CALL @ 877-439-3678

Be anxious for nothing, but in everything by prayer and supplication, with thanksgiving, let your requests be known to God: ...Phil 4:6

Respectfully,

Guy Garman

877-439-3678

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