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6-valuable-resources-to-help-with-filing-form-1023

6 Valuable Resources to Help With Filing Form 1023

Jeanne

Anyone who has filed for tax-exempt status before knows that it is not exactly smooth sailing. Not only can form 1023 be long and complicated but if not accepted the first time around it can delay your entire registration process. 

To prevent issues with the filing process, we have compiled a list of the best resources to utilize when searching for help with your form 1023, or your 1023 EZ, along with an overview of the pros and cons for each. Some of these people and organizations are paid, some are free, but at least one of them should give you the tools to successfully file your application the first time. 

6-valuable-resources-to-help-with-filing-form-1023-the-hard-truth

The Hard Truth About 1023

Leaders of new organizations often feel intimidated about completing their main organizing document and compiling bylaws. These uneasy feelings are typically there when it comes time to file their 1023 as well. It is essential to get form 1023 filled out correctly because this is the form that results in the applicant, your nonprofit, joining the tax-exempt organizations club. Having to wait for tax exemption is a process that can put a hard block on progressing your mission and achieving your goals. Luckily the 1023 is a one-time deal so, assuming you received approval, only needs to be submitted once.

Pro Tip: Although the 1023 only needs to be submitted once, your 990-N must be filed annually to maintain that coveted tax exempt status. 

Government-issued forms in general have a reputation for being difficult. Form 1023 is especially notorious for its length and complexity, regardless of your organizational structure. Even though it may be complicated, there are a ton of resources that you can turn to for assistance. You got this, we believe in you! 

In addition to external support, you may have the ability to file form 1023 EZ, which is a shortened and simplified version of the original. However, you may not have a choice between the forms as only certain nonprofits qualify. Verify whether this is the form classification for you by completing the eligibility worksheet at the end of the form instructions.  If you are wondering which to file, read our article on the differences between the 1023 vs 1023 EZ.

Whether your nonprofit or public charity has a large budget that can support hiring help or requires free assistance, we have an option that will be just right for you. 

6-valuable-resources-to-help-with-filing-form-1023-experienced-attorney

1. An Experienced Attorney

For an organization that can afford it, it is best to have an attorney who specializes in tax-exempt organizations assist. These professionals offer the best in expertise and efficiency, and with just a bit of oversight on your part will take over the whole process for you. 

6-valuable-resources-to-help-with-filing-form-1023-experienced-lawyerEva says an experienced lawyer is well worth the expense!

While hiring an attorney is the easiest way to get things done, they are also the most expensive. Most nonprofits are not overflowing with surplus cash for these kinds of expenses, particularly in the very early stages. However, if you are able to swing it, think of it as a good investment for the future of your organization. 

Pros:

  • Most fool-proof, as it is in the hands of a professional

  • Easiest, as you do not have to do any of the difficult work

Cons

  • Most expensive option

Pro Tip: If you are paying someone to prepare your IRS forms for you, they must have the appropriate Preparer Tax Identification Number (PTIN). Ensure that your attorney has this before beginning the process. 

6-valuable-resources-to-help-with-filing-form-1023-board-members

2. Your Board Members

Your board members are a valuable resource for your organization. Their general purpose is to support the management and growth of the organization with their specialized skills and ties to the cause. A (less expensive) option, when compared to hiring an external expert, is to utilize your board members.

Consider splitting the 1023 into sections and have each board member work on a portion of the pages. The team can double-check the final product together. This approach makes the workload manageable as it is spread between a number of people. 

Pros: 

  • Typically free 

  • Gets your board members involved

Cons:

  • Unreliable, as it depends on your board members having the necessary knowledge and/or connections

6-valuable-resources-to-help-with-filing-form-1023-law-clinics

3. Request Help From Law Clinics

Another way you can get assistance on your 1023 is to reach out to a local law school and see if they have any student programs and/or volunteer law clinics that can help you. Students are often seeking opportunities to build their future resumes with experience. Additionally, many students and law clinics need to complete pro bono activities. In return for their help, you can offer to provide recognition and evidence of their contribution to your organization. 

Pros:

  • You will likely receive services for free, or at a reduced cost

  • Mutually beneficial

Cons: 

  • No direct oversight from an expert

6-valuable-resources-to-help-with-filing-form-1023-irs

4. The IRS

To get help with your 1023, you can also go straight to the source. The Internal Revenue Service has a guide with instructions dedicated to filing their forms. You can find the publication specific to the 1023 here. It even includes an example to follow section by section. When you have finished filling in the forms, you can simply upload your completed form 1023 pdf or IRS form 1023-EZ pdf right to the site. This is a good option for someone who is a thorough reader and deliberate worker. On the other hand, the sheer length of the instructions may be overwhelming to some. 

6-valuable-resources-to-help-with-filing-form-1023-irsThe IRS can be helpful sometimes, right, Mary?

Pros:

  • Free service

  • Direct from the IRS, so the information (the form and instructions) received is current  and correct

Cons:

  • Website is not user-friendly

  • Involves a lot of in-depth reading and comprehension

6-valuable-resources-to-help-with-filing-form-1023-springly

5. Springly

We cannot make a list without including ourselves! Springly is an excellent source for all things nonprofit, but especially helpful for information on starting a nonprofit and learning how to file the necessary forms. Unlike the technical jargon you will find on the IRS website, our nonprofit specialists break down the info in a way that is easy to read and understand. You can even find a form 1023 checklist, to ensure that you have completed everything necessary before filing.

Pros:

  • Complex information that is interpreted in a way that is easy for everyone to digest

  • Multiple articles to choose from

Cons:

  • You will still have to fill out the form by hand

6-valuable-resources-to-help-with-filing-form-1023-facebook

6. Facebook Groups

One of the benefits of living in the age of social media is that there is always easy access to advice. Make use of Facebook nonprofit groups like Nonprofit Management Circle to reach out for any assistance you need, or any questions you might have. 

Pros:

  • You can get help from other nonprofit leaders who have been through the process and can provide valuable insight at no cost

Cons:

  • You may have to research a little to determine whether which groups are the most receptive and engaged

When deciding which option to use, keep in mind that there is an IRS form 1023 filing fee of $600, and a filing fee of $275 for form 1023 EZ. These fees must be paid through Pay.gov when the application is filed. Also, make sure you keep copies on file for future reference. 

The filing of IRS form 1023 is a huge step toward springboarding your nonprofit toward fulfillment of its mission. While you need to give it the consideration and attention it deserves, do not let it intimidate you. There is always someone who can guide you through the process if you know where to look. We hope that the form 1023 help offered in this article makes your own filing experience smoother, so that you and your nonprofit entity can get straight to the part where you are out there making the world a better place. 

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Springly is trusted by over 20,000 nonprofits to help them run their organizations on a daily basis. Try it, test it, love it with a 14-day free trial!

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