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Irs 1040x Form

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Irs 1040x Form

Irs 1040x form 3. Irs 1040x form   Section 501(c)(3) Organizations Table of Contents IntroductionChild care organizations. Irs 1040x form Topics - This chapter discusses: Useful Items - You may want to see: Contributions to 501(c)(3) OrganizationsCertain annuity contracts. Irs 1040x form Certain contracts held by a charitable remainder trust. Irs 1040x form Excise Taxes. Irs 1040x form Indoor tanning services. Irs 1040x form Application for Recognition of ExemptionPolitical activity. Irs 1040x form Private delivery service. Irs 1040x form Amendments to organizing documents required. Irs 1040x form How to show reasonable action and good faith. Irs 1040x form Not acting reasonably and in good faith. Irs 1040x form Prejudicing the interest of the Government. Irs 1040x form Procedure for requesting extension. Irs 1040x form More information. Irs 1040x form 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. Irs 1040x form Grass roots expenditures. Irs 1040x form Lobbying nontaxable amount. Irs 1040x form Grass roots nontaxable amount. Irs 1040x form Organization that no longer qualifies. Irs 1040x form Tax on organization. Irs 1040x form Tax on managers. Irs 1040x form Taxes on organizations. Irs 1040x form Taxes on managers. Irs 1040x form Political expenditures. Irs 1040x form Correction of expenditure. Irs 1040x form 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. Irs 1040x form Religious. Irs 1040x form Charitable. Irs 1040x form Scientific. Irs 1040x form Testing for public safety. Irs 1040x form Literary. Irs 1040x form Educational. Irs 1040x form 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). Irs 1040x form The prevention of cruelty to children or animals. Irs 1040x form To qualify, the organization must be a corporation, community chest, fund, articles of association, or foundation. Irs 1040x form A trust is a fund or foundation and will qualify. Irs 1040x form However, an individual or a partnership will not qualify. Irs 1040x form Examples. Irs 1040x form   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. Irs 1040x form Child care organizations. Irs 1040x form   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. Irs 1040x form Instrumentalities. Irs 1040x form   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). Irs 1040x form Examples of a qualifying instrumentality might include state schools, universities, or hospitals. Irs 1040x form However, if an organization is an integral part of the local government or possesses governmental powers, it does not qualify for exemption. Irs 1040x form A state or municipality itself does not qualify for exemption. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Fundraising events. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form See Disclosure of Quid Pro Quo Contributions in chapter 2. Irs 1040x form Exemption application not filed. Irs 1040x form   Donors cannot deduct any charitable contribution to an organization that is required to apply for recognition of exemption but has not done so. Irs 1040x form Separate fund—contributions that are deductible. Irs 1040x form   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. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Personal benefit contracts. Irs 1040x form   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. Irs 1040x form   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. Irs 1040x form Certain annuity contracts. Irs 1040x form   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). Irs 1040x form Certain contracts held by a charitable remainder trust. Irs 1040x form   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. Irs 1040x form Excise tax. Irs 1040x form   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. Irs 1040x form The excise tax does not apply if all of the direct and indirect beneficiaries under the contract are organizations. Irs 1040x form Excise Taxes. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Indoor tanning services. Irs 1040x form   If your organization provides an indoor tanning bed service, the ACA imposed a 10% excise tax on services provided after June 30, 2010. Irs 1040x form For more information, go to IRS. Irs 1040x form gov and select Affordable Care Act Tax Provisions. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form See the organization headings that follow for specific information your organization may need to provide. Irs 1040x form Form 1023. Irs 1040x form   Your organization must file its application for recognition of exemption on Form 1023. Irs 1040x form See chapter 1 and the instructions accompanying Form 1023 for the procedures to follow in applying. Irs 1040x form Some organizations are not required to file Form 1023. Irs 1040x form See Organizations Not Required To File Form 1023, later. Irs 1040x form    Additional information to help you complete your application can be found online. Irs 1040x form 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. Irs 1040x form See Exemption Requirements - Section 501(c)(3) Organizations. Irs 1040x form   Form 1023 and accompanying statements must show that all of the following are true. Irs 1040x form The organization is organized exclusively for, and will be operated exclusively for, one or more of the purposes (religious, charitable, etc. Irs 1040x form ) specified in the introduction to this chapter. Irs 1040x form No part of the organization's net earnings will inure to the benefit of private shareholders or individuals. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form See Political activity, next, and Lobbying Expenditures , near the end of this chapter. Irs 1040x form Political activity. Irs 1040x form   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). Irs 1040x form Such participation or intervention includes the publishing or distributing of statements. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Effective date of exemption. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Otherwise, exemption will be recognized only from the date of receipt. Irs 1040x form The date of receipt is the date of the U. Irs 1040x form S. Irs 1040x form 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. Irs 1040x form Private delivery service. Irs 1040x form   If a private delivery service designated by the IRS, rather than the U. Irs 1040x form S. Irs 1040x form Postal Service, is used to deliver the application, the date of receipt is the date recorded or marked by the private delivery service. Irs 1040x form The following private delivery services have been designated by the IRS. Irs 1040x form DHL Express (DHL): DHL “Same Day” Service. Irs 1040x form Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First. Irs 1040x form United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. Irs 1040x form M. Irs 1040x form , UPS Worldwide Express Plus, and UPS Worldwide Express. Irs 1040x form Amendments to organizing documents required. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Extensions of time for filing. Irs 1040x form   There are two ways organizations seeking exemption can receive an extension of time for filing Form 1023. Irs 1040x form Automatic 12-month extension. Irs 1040x form 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. Irs 1040x form To get this extension, an organization must add the following statement at the top of its application: “Filed Pursuant to Section 301. Irs 1040x form 9100-2. Irs 1040x form ” Discretionary extensions. Irs 1040x form 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. Irs 1040x form How to show reasonable action and good faith. Irs 1040x form   An organization acted reasonably and showed good faith if at least one of the following is true. Irs 1040x form The organization requests relief before its failure to file is discovered by the IRS. Irs 1040x form The organization failed to file because of intervening events beyond its control. Irs 1040x form 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. Irs 1040x form The organization reasonably relied upon the written advice of the IRS. Irs 1040x form The organization reasonably relied upon the advice of a qualified tax professional who failed to file or advise the organization to file Form 1023. Irs 1040x form 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. Irs 1040x form Not acting reasonably and in good faith. Irs 1040x form   An organization has not acted reasonably and in good faith under the following circumstances. Irs 1040x form 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. Irs 1040x form It was informed of the requirement to file and related tax consequences, but chose not to file. Irs 1040x form It uses hindsight in requesting relief. Irs 1040x form 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. Irs 1040x form Prejudicing the interest of the Government. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Procedure for requesting extension. Irs 1040x form   To request a discretionary extension, an organization must submit (to the IRS address shown on Form 1023 and Notice 1382) the following. Irs 1040x form A statement showing the date Form 1023 was required to have been filed and the date it was actually filed. Irs 1040x form Any documents relevant to the application. Irs 1040x form An affidavit describing in detail the events that led to the failure to apply and to the discovery of that failure. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form ” 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. Irs 1040x form This includes the organization's return preparer, and any accountant or attorney, knowledgeable in tax matters, who advised the taxpayer on the application. Irs 1040x form The affidavits must describe the engagement and responsibilities of the individual and the advice that he or she provided. Irs 1040x form 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. Irs 1040x form ” 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. Irs 1040x form 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. Irs 1040x form The organization, if requested, has to submit copies of its tax returns, and copies of the returns of other affected taxpayers. Irs 1040x form   A request for this relief in connection with an application for exemption does not require payment of an additional user fee. Irs 1040x form Also, a request for relief under the automatic 12-month extension does not require payment of a user fee. Irs 1040x form More information. Irs 1040x form   For more information about these procedures, see Regulations sections 301. Irs 1040x form 9100-1, 301. Irs 1040x form 9100-2, 301. Irs 1040x form 9100-3, Revenue Procedure 2013-4, section 6. Irs 1040x form 04, 2013-1 I. Irs 1040x form R. Irs 1040x form B. Irs 1040x form 126, and Revenue Procedure 2013-8, 2013-1 I. Irs 1040x form R. Irs 1040x form B. Irs 1040x form 237. Irs 1040x form See Revenue Procedure 2013-4 and Revenue Procedure 2013-8. Irs 1040x form Notification from the IRS. Irs 1040x form   Organizations filing Form 1023 and satisfying all requirements of section 501(c)(3) will be notified of their exempt status in writing. Irs 1040x form Organizations Not Required To File Form 1023 Some organizations are not required to file Form 1023. Irs 1040x form 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. Irs 1040x form Any organization (other than a private foundation) normally having annual gross receipts of not more than $5,000 (see Gross receipts test, later). Irs 1040x form These organizations are exempt automatically if they meet the requirements of section 501(c)(3). Irs 1040x form Filing Form 1023 to establish exemption. Irs 1040x form   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. Irs 1040x form By establishing its exemption, potential contributors are assured by the IRS that contributions will be deductible. Irs 1040x form A subordinate organization (other than a private foundation) covered by a group exemption letter does not have to submit a Form 1023 for itself. Irs 1040x form Private foundations. Irs 1040x form   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. Irs 1040x form Gross receipts test. Irs 1040x form   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. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form The organization must file Form 1023 within 90 days after the end of its second tax year. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Example. Irs 1040x form   An organization is organized and operated exclusively for charitable purposes and is not a private foundation. Irs 1040x form It was incorporated on January 1, 2009, and files returns on a calendar-year basis. Irs 1040x form It did not file a Form 1023. Irs 1040x form 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. Irs 1040x form Therefore, it did not have to file Form 1023 and is exempt for those years. Irs 1040x form However, for 2010, 2011, and 2012 the total gross receipts were $15,900. Irs 1040x form Therefore, the organization must file Form 1023 within 90 days after the end of its 2012 tax year. Irs 1040x form 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. Irs 1040x form The organization, however, will not lose its exempt status for the tax years ending before January 1, 2012. Irs 1040x form   The IRS will consider applying the Commissioner's discretionary authority to extend the time for filing Form 1023. Irs 1040x form See the procedures for this extension discussed earlier. Irs 1040x form Articles of Organization Your organization must include a conformed copy of its articles of organization with the application for recognition of exemption. Irs 1040x form This may be its trust instrument, corporate charter, articles of association, or any other written instrument by which it is created. Irs 1040x form 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. Irs 1040x form These conditions for exemption are referred to as the organizational test. Irs 1040x form Section 501(c)(3) is the provision of law that grants exemption to the organizations described in this chapter. Irs 1040x form 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). Irs 1040x form 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. Irs 1040x form Moreover, the organizational test is not satisfied by statements of your organization's officers that you intend to operate only for exempt purposes. Irs 1040x form Also, the test is not satisfied by the fact that your actual operations are for exempt purposes. Irs 1040x form In interpreting an organization's articles, the law of the state where the organization was created is controlling. Irs 1040x form 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. Irs 1040x form The following are examples illustrating the organizational test. Irs 1040x form Example 1. Irs 1040x form Articles of organization state that an organization is formed exclusively for literary and scientific purposes within the meaning of section 501(c)(3). Irs 1040x form These articles appropriately limit the organization's purposes. Irs 1040x form The organization meets the organizational test. Irs 1040x form Example 2. Irs 1040x form An organization, by the terms of its articles, is formed to engage in research without any further description or limitation. Irs 1040x form The organization will not be properly limited as to its purposes since all research is not scientific. Irs 1040x form The organization does not meet the organizational test. Irs 1040x form Example 3. Irs 1040x form 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). Irs 1040x form The organization meets the organizational test. Irs 1040x form Example 4. Irs 1040x form 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. Irs 1040x form Example 5. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Example 6. Irs 1040x form 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. Irs 1040x form Such purposes are vague and may be accomplished other than in an exempt manner. Irs 1040x form Example 7. Irs 1040x form A stated purpose to operate a hospital does not meet the organizational test since it is not necessarily charitable. Irs 1040x form A hospital may or may not be exempt depending on the manner in which it is operated. Irs 1040x form Example 8. Irs 1040x form 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. Irs 1040x form Dedication and Distribution of Assets Assets of an organization must be permanently dedicated to an exempt purpose. Irs 1040x form 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. Irs 1040x form If the assets could be distributed to members or private individuals or for any other purpose, the organizational test is not met. Irs 1040x form Dedication. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Distribution. Irs 1040x form   Revenue Procedure 82-2, 1982-1 C. Irs 1040x form B. Irs 1040x form 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. Irs 1040x form The procedure also provides a sample of an acceptable dissolution provision for organizations required to have one. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Sample articles of organization. Irs 1040x form   See sample articles of organization in the Appendix in the back of this publication. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form You must submit a copy of the pertinent contracts, agreements, publications, programs, etc. Irs 1040x form 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. Irs 1040x form See also Private Schools , discussed later. Irs 1040x form 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. Irs 1040x form Advocacy of a position. Irs 1040x form   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. Irs 1040x form The mere presentation of unsupported opinion is not educational. Irs 1040x form Method not educational. Irs 1040x form   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). Irs 1040x form The following factors may indicate that the method is not educational. Irs 1040x form The presentation of viewpoints unsupported by facts is a significant part of the organization's communications. Irs 1040x form The facts that purport to support the viewpoint are distorted. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form   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. Irs 1040x form Qualifying organizations. Irs 1040x form   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. Irs 1040x form College book stores, cafeterias, restaurants, etc. Irs 1040x form   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. Irs 1040x form Alumni association. Irs 1040x form   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. Irs 1040x form 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 . Irs 1040x form Athletic organization. Irs 1040x form   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. Irs 1040x form If it is not so engaged, your organization may be exempt as a social club described in chapter 4. Irs 1040x form 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. Irs 1040x form If your organization is not exempt as an educational organization, see Amateur Athletic Organizations , later in this chapter. Irs 1040x form 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. Irs 1040x form The racial composition of the student body, and of the faculty and administrative staff, as of the current academic year. Irs 1040x form (This information also must be projected, so far as may be feasible, for the next academic year. Irs 1040x form ) The amount of scholarship and loan funds, if any, awarded to students enrolled and the racial composition of students who have received the awards. Irs 1040x form A list of the school's incorporators, founders, board members, and donors of land or buildings, whether individuals or organizations. Irs 1040x form 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. Irs 1040x form The public school district and county in which the school is located. Irs 1040x form How to determine racial composition. Irs 1040x form   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. Irs 1040x form Nevertheless, a statement of the method by which the racial composition was determined must be supplied. Irs 1040x form The identity of individual students or members of the faculty and administrative staff should not be included with this information. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form Also, the school must circulate information that clearly states the school's admission policies. Irs 1040x form 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. Irs 1040x form The IRS considers discrimination on the basis of race to include discrimination on the basis of color or national or ethnic origin. Irs 1040x form 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. Irs 1040x form Conversely, the absence of racial discrimination in the employment of faculty and administrative staff is indicative of a racially nondiscriminatory policy as to students. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Policy statement. Irs 1040x form   The school must include a statement of its racially nondiscriminatory policy in all its brochures and catalogs dealing with student admissions, programs, and scholarships. Irs 1040x form 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. Irs 1040x form Publicity requirement. Irs 1040x form   The school must make its racially nondiscriminatory policy known to all segments of the general community served by the school. Irs 1040x form 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. Irs 1040x form To satisfy this requirement, the school must use one of the following two methods. Irs 1040x form Method one. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form If this method is used, the notice must meet the following printing requirements. Irs 1040x form It must appear in a section of the newspaper likely to be read by prospective students and their families. Irs 1040x form It must occupy at least 3 column inches. Irs 1040x form It must have its title printed in at least 12 point bold face type. Irs 1040x form It must have the remaining text printed in at least 8 point type. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form   Method two. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Exceptions. Irs 1040x form   The publicity requirements will not apply in the following situations. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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 . Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form   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. Irs 1040x form The IRS believes that these publicity requirements are the most effective methods to make known a school's racially nondiscriminatory policy. Irs 1040x form In this regard, it is each school's responsibility to determine whether either of the exceptions applies. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Facilities and programs. Irs 1040x form   A school must be able to show that all of its programs and facilities are operated in a racially nondiscriminatory manner. Irs 1040x form Scholarship and loan programs. Irs 1040x form   As a general rule, all scholarship or other comparable benefits obtainable at the school must be offered on a racially nondiscriminatory basis. Irs 1040x form This must be known throughout the general community being served by the school and should be referred to in its publicity. Irs 1040x form 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. Irs 1040x form Certification. Irs 1040x form   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. Irs 1040x form   Failure to comply with the guidelines ordinarily will result in the proposed revocation of the exempt status of a school. Irs 1040x form Recordkeeping requirements. Irs 1040x form 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. Irs 1040x form Records indicating the racial composition of the student body, faculty, and administrative staff for each academic year. Irs 1040x form Records sufficient to document that scholarship and other financial assistance is awarded on a racially nondiscriminatory basis. Irs 1040x form Copies of all materials used by or on behalf of the school to solicit contributions. Irs 1040x form Copies of all brochures, catalogs, and advertising dealing with student admissions, programs, and scholarships. Irs 1040x form (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. Irs 1040x form ) 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Similarly, the IRS does not require a school to keep records prohibited under state or federal law. Irs 1040x form Exceptions. Irs 1040x form   The school does not have to independently maintain these records for IRS use if both of the following are true. Irs 1040x form 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. Irs 1040x form The school maintains copies of these reports from which this information is readily obtainable. Irs 1040x form 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. Irs 1040x form Failure to maintain records. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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). Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form The rest of this section contains a description of the information to be provided by certain specific organizations. Irs 1040x form This information is in addition to the required inclusions described in chapter 1, and other statements requested on Form 1023. Irs 1040x form Each of the following organizations must submit the information described. Irs 1040x form Charitable organization supporting education. Irs 1040x form   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. Irs 1040x form Scholarships. Irs 1040x form   If the organization awards or plans to award scholarships, complete Schedule H of Form 1023. Irs 1040x form Also, submit the following: Criteria used for selecting recipients, including the rules of eligibility. Irs 1040x form How and by whom the recipients are or will be selected. Irs 1040x form If awards are or will be made directly to individuals, whether information is required assuring that the student remains in school. Irs 1040x form 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. Irs 1040x form A copy of the scholarship application form and any brochures or literature describing the scholarship program. Irs 1040x form Hospital. Irs 1040x form   If you are organized to operate a charitable hospital, complete and attach Section I of Schedule C, Form 1023. Irs 1040x form   If your hospital was transferred to you from proprietary ownership, complete and attach Schedule G of Form 1023. Irs 1040x form 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. Irs 1040x form Submit also an appraisal showing the fair rental value of the rented space. Irs 1040x form Clinic. Irs 1040x form   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. Irs 1040x form Home for the aged. Irs 1040x form   If you are organized to operate a home for the aged, complete and attach Schedule F of Form 1023 and required attachments. Irs 1040x form Community nursing bureau. Irs 1040x form   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. Irs 1040x form Organization providing loans. Irs 1040x form   If you make, or will make, loans for charitable and educational purposes, submit the following information. Irs 1040x form An explanation of the circumstances under which such loans are, or will be, made. Irs 1040x form Criteria for selection, including the rules of eligibility. Irs 1040x form How and by whom the recipients are or will be selected. Irs 1040x form Manner of repayment of the loan. Irs 1040x form Security required, if any. Irs 1040x form Interest charged, if any, and when payable. Irs 1040x form Copies in duplicate of the loan application and any brochures or literature describing the loan program. Irs 1040x form Public-interest law firms. Irs 1040x form   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. Irs 1040x form How the litigation can reasonably be said to be representative of a broad public interest rather than a private one. Irs 1040x form Whether the organization will accept fees for its services. Irs 1040x form A description of the cases litigated or to be litigated and how they benefit the public generally. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Acceptance of attorneys' fees. Irs 1040x form   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. Irs 1040x form Upon undertaking a representation, the organization cannot withdraw from the case because the litigant is unable to pay the fee. Irs 1040x form   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. Irs 1040x form All fee awards must be paid to the organization and not to its individual staff attorneys. Irs 1040x form Instead, a public-interest law firm can reasonably compensate its staff attorneys, but only on a straight salary basis. Irs 1040x form 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. Irs 1040x form   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. Irs 1040x form   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. Irs 1040x form Religious Organizations To determine whether an organization meets the religious purposes test of section 501(c)(3), the IRS maintains two basic guidelines. Irs 1040x form That the particular religious beliefs of the organization are truly and sincerely held. Irs 1040x form That the practices and rituals associated with the organization's religious belief or creed are not illegal or contrary to clearly defined public policy. Irs 1040x form 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. Irs 1040x form 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. Irs 1040x form Churches. Irs 1040x form   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. Irs 1040x form 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. Irs 1040x form   In determining whether an admittedly religious organization is also a church, the IRS does not accept every assertion that the organization is a church. Irs 1040x form Because beliefs and practices vary so widely, there is no single definition of the word church for tax purposes. Irs 1040x form The IRS considers the facts and circumstances of each organization applying for church status. Irs 1040x form Convention or association of churches. Irs 1040x form   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. Irs 1040x form Integrated auxiliaries. Irs 1040x form   An organization is an integrated auxiliary of a church if all the following are true. Irs 1040x form The organization is described both in sections 501(c)(3) and 509(a)(1), 509(a)(2), or 509(a)(3). Irs 1040x form It is affiliated with a church or a convention or association of churches. Irs 1040x form It is internally supported. Irs 1040x form An organization is internally supported unless both of the following are true. Irs 1040x form 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). Irs 1040x form 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. Irs 1040x form Special rule. Irs 1040x form   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. Irs 1040x form   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. Irs 1040x form   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. Irs 1040x form Scientific Organizations You must show that your organization's research will be carried on in the public interest. Irs 1040x form 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. Irs 1040x form Aiding in the scientific education of college or university students. Irs 1040x form Obtaining scientific information that is published in a treatise, thesis, trade publication, or in any other form th
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Know Your Rights When Shopping for Credit

Like everything else you buy, it pays to comparison shop for credit. Check financial and banking websites to find up-to-date interest rate reports on mortgages, auto loans, credit cards, home equity loans, and other banking products. The Equal Credit Opportunity Act protects you when dealing with anyone who regularly offers credit, including banks, finance companies, stores, credit card companies and credit unions. When you apply for credit, a creditor may not:

  • Ask about or consider your sex, race, national origin or religion.
  • Ask about your marital status or your spouse, unless you are applying for a joint account or relying on your spouse's income, or you live in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin)
  • Ask about your plans to have or raise children
  • Refuse to consider public assistance income or regularly received alimony or child support
  • Refuse to consider income because of your sex or marital status or because it is from part-time work or retirement benefits

You have the right to:

  • Have credit in your birth name, your first name and your spouse/ partner's last name, or your first name and a combined last name
  • Have a co-signer other than your spouse if one is necessary
  • Keep your own accounts after you change your name or marital status or retire, unless the creditor has evidence you are unable or unwilling to pay
  • Know why a credit application was rejected-the creditor must give you the specific reasons or tell you where and how you can get them if you ask within 60 days
  • Have accounts shared with your spouse reported in both your names
  • Know how much it will cost to borrow money
  • YOU HAVE THE RIGHT TO A FREE ANNUAL CREDIT REPORT .

For additional information on credit, see Buying a Home. Other sources of information include the HUD Housing Counseling Clearinghouse (1-888-466-3487), the FTC and the National Consumer Law Center.

The Irs 1040x Form

Irs 1040x form Publication 225 - Introductory Material Table of Contents IntroductionOrdering forms and publications. Irs 1040x form Tax questions. Irs 1040x form Future Developments What's New for 2013 What's New for 2014 Reminders Introduction You are in the business of farming if you cultivate, operate, or manage a farm for profit, either as owner or tenant. Irs 1040x form A farm includes livestock, dairy, poultry, fish, fruit, and truck farms. Irs 1040x form It also includes plantations, ranches, ranges, and orchards. Irs 1040x form This publication explains how the federal tax laws apply to farming. Irs 1040x form Use this publication as a guide to figure your taxes and complete your farm tax return. Irs 1040x form If you need more information on a subject, get the specific IRS tax publication covering that subject. Irs 1040x form We refer to many of these free publications throughout this publication. Irs 1040x form See chapter 16 for information on ordering these publications. Irs 1040x form The explanations and examples in this publication reflect the Internal Revenue Service's interpretation of tax laws enacted by Congress, Treasury regulations, and court decisions. Irs 1040x form However, the information given does not cover every situation and is not intended to replace the law or change its meaning. Irs 1040x form This publication covers subjects on which a court may have made a decision more favorable to taxpayers than the interpretation of the Service. Irs 1040x form Until these differing interpretations are resolved by higher court decisions, or in some other way, this publication will continue to present the interpretation of the Service. Irs 1040x form The IRS Mission. Irs 1040x form   Provide America's taxpayers top quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all. Irs 1040x form Comments and suggestions. Irs 1040x form   We welcome your comments about this publication and your suggestions for future editions. Irs 1040x form   You can write to us at the following address: Internal Revenue Service Business Forms and Publications Branch SE:W:CAR:MP:T:B 1111 Constitution Ave. Irs 1040x form NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Irs 1040x form Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Irs 1040x form   You can email us at taxforms@irs. Irs 1040x form gov. Irs 1040x form Please put “Publications Comment” on the subject line. Irs 1040x form You can also send us comments from www. Irs 1040x form irs. Irs 1040x form gov/formspubs/, select “Comment on Tax Forms and Publications” under “More Information. Irs 1040x form ”   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Irs 1040x form Ordering forms and publications. Irs 1040x form   Visit www. Irs 1040x form irs. Irs 1040x form gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Irs 1040x form Internal Revenue Service 1201 N. Irs 1040x form Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Irs 1040x form   If you have a tax question, check the information available on IRS. Irs 1040x form gov or call 1-800-829-1040. Irs 1040x form We cannot answer tax questions sent to either of the above addresses. Irs 1040x form Comments on IRS enforcement actions. Irs 1040x form   The Small Business and Agricultural Regulatory Enforcement Ombudsman and 10 Regional Fairness Boards were established to receive comments from small business about federal agency enforcement actions. Irs 1040x form The Ombudsman will annually evaluate the enforcement activities of each agency and rate its responsiveness to small business. Irs 1040x form If you wish to comment on the enforcement actions of the IRS, you can: Call 1-888-734-3247, Fax your comments to 202-481-5719, Write to Office of the National Ombudsman U. Irs 1040x form S. Irs 1040x form Small Business Administration 409 3rd Street, S. Irs 1040x form W. Irs 1040x form  Washington, DC 20416 Send an email to ombudsman@sba. Irs 1040x form gov, or Download the appraisal form at  www. Irs 1040x form sba. Irs 1040x form gov/ombudsman. Irs 1040x form Treasury Inspector General for Tax Administration. Irs 1040x form   If you want to confidentially report misconduct, waste, fraud, or abuse by an IRS employee, you can call 1-800-366-4484 (1-800-877-8339 for TTY/TDD users). Irs 1040x form You can remain anonymous. Irs 1040x form Farm tax classes. Irs 1040x form   Many state Cooperative Extension Services conduct farm tax workshops in conjunction with the IRS. Irs 1040x form Contact your county extension office for more information. Irs 1040x form Rural tax education website. Irs 1040x form   The Rural Tax Education website is a source for information concerning agriculturally related income and deductions and self-employment tax. Irs 1040x form The website is available for farmers and ranchers, other agricultural producers, Extension educators, and any one interested in learning about the tax side of the agricultural community. Irs 1040x form Members of the National Farm Income Tax Extension Committee are contributors for the website and the website is hosted by Utah State University Cooperative Extension. Irs 1040x form You can visit the website at www. Irs 1040x form ruraltax. Irs 1040x form org. Irs 1040x form Future Developments The IRS has created a page on IRS. Irs 1040x form gov for information about Publication 225, at  www. Irs 1040x form irs. Irs 1040x form gov/pub225. Irs 1040x form Information about recent developments affecting Publication 225 will be posted on that page. Irs 1040x form What's New for 2013 The following items highlight a number of administrative and tax law changes for 2013. Irs 1040x form They are discussed in more detail throughout the publication. Irs 1040x form Standard mileage rate. Irs 1040x form  For 2013, the standard mileage rate for the cost of operating your car, van, pickup, or panel truck for each mile of business use is 56. Irs 1040x form 5 cents. Irs 1040x form See chapter 4. Irs 1040x form Simplified method for business use of home deduction. Irs 1040x form  The IRS now provides a simplified method to determine your expenses for business use of your home. Irs 1040x form For more information, see Schedule C (Form 1040), Part II, and its instructions. Irs 1040x form See chapter 4. Irs 1040x form Increased section 179 expense deduction dollar limits. Irs 1040x form  The maximum amount you can elect to deduct for most section 179 property you placed in service in 2013 is $500,000. Irs 1040x form This limit is reduced by the amount by which the cost of the property placed in service during the tax year exceeds $2 million. Irs 1040x form See chapter 7. Irs 1040x form Extension of special depreciation allowance for certain qualified property acquired after December 31, 2007. Irs 1040x form  You may be able to take a 50% special depreciation allowance for certain qualified property acquired after December 31, 2007, and placed in service before January 1, 2014. Irs 1040x form See chapter 7. Irs 1040x form Expiration of the 3-year recovery period for certain race horses. Irs 1040x form . Irs 1040x form  The 3-year recovery period for race horses two years old or younger will expire for such horses placed in service after December 31, 2013. Irs 1040x form See chapter 7. Irs 1040x form Tax rates. Irs 1040x form  For tax years beginning in 2013, the social security part of the self-employment tax increases from 10. Irs 1040x form 4% to 12. Irs 1040x form 4%. Irs 1040x form As a result, the self-employment tax is increased from 13. Irs 1040x form 3% to 15. Irs 1040x form 3%. Irs 1040x form See chapter 12. Irs 1040x form Maximum net earnings. Irs 1040x form  The maximum net self-employment earnings subject to the social security part (12. Irs 1040x form 4%) of the self-employment tax increased to $113,700 for 2013. Irs 1040x form There is no maximum limit on earnings subject to the Medicare part (2. Irs 1040x form 9%). Irs 1040x form See chapter 12. Irs 1040x form Net investment income tax. Irs 1040x form  For tax years beginning in 2013, individuals, estates, and trusts may be subject to the net investment income tax (NIIT). Irs 1040x form If you are a trader in financial instruments and commodities and required to file Schedule C (Form 1040), your investment income (for purposes of the NIIT) may be reduced by your interest and other investment expenses to the extent those expenses are not used to reduce your self-employment income. Irs 1040x form For information about NIIT and the special rule for traders in financial instruments and commodities, see the Instructions for Form 8960. Irs 1040x form Social Security and Medicare Tax for 2013. Irs 1040x form  The employee tax rate for social security is 6. Irs 1040x form 2%. Irs 1040x form The employer tax rate for social security remains unchanged at 6. Irs 1040x form 2%. Irs 1040x form The social security wage base limit is $113,700. Irs 1040x form The Medicare tax rate is 1. Irs 1040x form 45% each for the employee and employer, unchanged from 2012. Irs 1040x form There is no wage base limit for Medicare tax. Irs 1040x form See chapter 13. Irs 1040x form Additional Medicare Tax. Irs 1040x form  For tax years beginning in 2013, a 0. Irs 1040x form 9% Additional Medicare Tax applies to your Medicare wages, Railroad Tax Act (RRTA) compensation, and self-employment income above a threshold amount. Irs 1040x form Use Form 8959, Additional Medicare Tax, to figure this tax. Irs 1040x form For more information, see the Instructions for Form 8959 and the Instructions for Schedule SE (Form 1040). Irs 1040x form In addition to withholding Medicare tax at 1. Irs 1040x form 45%, you must withhold a 0. Irs 1040x form 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. Irs 1040x form You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Irs 1040x form Additional Medicare Tax is only imposed on the employee. Irs 1040x form There is no employer share of Additional Medicare Tax. Irs 1040x form All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold. Irs 1040x form For more information on what wages are subject to Medicare tax, see the chart, Special Rules for Various Types of Services and Payments, in section 15 of Publication 15 (Circular E), Employer's Tax Guide. Irs 1040x form For more information on Additional Medicare Tax, visit IRS. Irs 1040x form gov and enter “Additional Medicare Tax” in the search box. Irs 1040x form See chapter 13. Irs 1040x form Leave-Based donation programs to aid victims of Hurricane Sandy. Irs 1040x form  Under these programs, employees may donate their vacation, sick, or personal leave in exchange for employer cash payments made before January 1, 2014, to qualified tax-exempt organizations providing relief for the victims of Hurricane Sandy. Irs 1040x form The donated leave will not be included in the income or wages of the employee. Irs 1040x form The employer may deduct the cash payments as business expenses or charitable contributions. Irs 1040x form See chapter 13. Irs 1040x form Work opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans extended. Irs 1040x form  The work opportunity tax credit is now available for eligible unemployed veterans who begin work before January 1, 2014. Irs 1040x form Qualified tax-exempt organizations that hire eligible unemployed veterans can claim the work opportunity tax credit against their payroll tax liability using Form 5884-C, Work Opportunity Credit for Qualified Tax-Exempt Organizations Hiring Qualified Veterans. Irs 1040x form For more information, visit IRS. Irs 1040x form gov and enter “work opportunity credit” in the search box. Irs 1040x form See chapter 13. Irs 1040x form Estimated tax. Irs 1040x form  For tax years beginning in 2013, the Net Investment Income Tax (NIIT) may need to be included when calculating your estimated tax. Irs 1040x form Also, when figuring your estimated tax, you may need to include the 0. Irs 1040x form 9% Additional Medicare Tax applicable to Medicare wages, Railroad Retirement Tax Act (RRTA) compensation, and self-employment income above the threshold amount based on your filing status. Irs 1040x form For more information, see Publication 505. Irs 1040x form What's New for 2014 Maximum net earnings. Irs 1040x form  The maximum net self-employment earnings subject to the social security part of the self-employment tax for 2014 will be discussed in the 2013 Publication 334. Irs 1040x form See chapter 12. Irs 1040x form Social security and Medicare tax for 2014. Irs 1040x form  The employee and employer tax rates for social security and the maximum amount of wages subject to social security tax for 2014 will be discussed in Publication 51 (Circular A), Agricultural Employer's Tax Guide (For use in 2014). Irs 1040x form The Medicare tax rate for 2014 will also be discussed in Publication 51 (Circular A) (For use in 2014). Irs 1040x form There is no limit on the amount of wages subject to Medicare tax. Irs 1040x form See chapter 13. Irs 1040x form Reminders The following reminders and other items may help you file your tax return. Irs 1040x form   IRS e-file (Electronic Filing) You can file your tax returns electronically using an IRS e-file option. Irs 1040x form The benefits of IRS e-file include faster refunds, increased accuracy, and acknowledgment of IRS receipt of your return. Irs 1040x form You can use one of the following IRS e-file options. Irs 1040x form Use an authorized IRS e-file provider. Irs 1040x form Use a personal computer. Irs 1040x form Visit a Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) site. Irs 1040x form For details on these fast filing methods, see your income tax package. Irs 1040x form Principal agricultural activity codes. Irs 1040x form  You must enter on line B of Schedule F (Form 1040) a code that identifies your principal agricultural activity. Irs 1040x form It is important to use the correct code because this information will identify market segments of the public for IRS Taxpayer Education programs. Irs 1040x form The U. Irs 1040x form S. Irs 1040x form Census Bureau also uses this information for its economic census. Irs 1040x form See the list of Principal Agricultural Activity Codes on page 2 of Schedule F (Form 1040). Irs 1040x form Publication on employer identification numbers (EIN). Irs 1040x form  Publication 1635, Understanding Your Employer Identification Number, provides general information on employer identification numbers. Irs 1040x form Topics include how to apply for an EIN and how to complete Form SS-4. Irs 1040x form Change of address. Irs 1040x form  If you change your home address, you should use Form 8822, Change of Addres, to notify the IRS. Irs 1040x form If you change your business address, you should use Form 8822-B, Change of Address or Responsible Party — Business, to notify the IRS. Irs 1040x form Be sure to include your suite, room, or other unit number. Irs 1040x form Reportable transactions. Irs 1040x form  You must file Form 8886, Reportable Transaction Disclosure Statement, to report certain transactions. Irs 1040x form You may have to pay a penalty if you are required to file Form 8886 but do not do so. Irs 1040x form Reportable transactions include (1) transactions the same as or substantially similar to tax avoidance transactions identified by the IRS, (2) transactions offered to you under conditions of confidentiality and for which you paid an advisor a minimum fee, (3) transactions for which you have or a related party has a right to a full or partial refund of fees if all or part of the intended tax consequences from the transaction are not sustained, (4) transactions that result in losses of at least $2 million in any single year or $4 million in any combination of years, and (5) transactions with asset holding periods of 45 days or less and that result in a tax credit of more than $250,000. Irs 1040x form For more information, see the Instructions for Form 8886. Irs 1040x form Form W-4 for 2014. Irs 1040x form  You should make new Forms W-4 available to your employees and encourage them to check their income tax withholding for 2014. Irs 1040x form Those employees who owed a large amount of tax or received a large refund for 2013 may need to submit a new Form W-4. Irs 1040x form See Publication 919, How Do I Adjust My Tax Withholding. Irs 1040x form Form 1099-MISC. Irs 1040x form  Generally, file Form 1099-MISC if you pay at least $600 in rents, services, and other miscellaneous payments in your farming business to an individual (for example, an accountant, an attorney, or a veterinarian) who is not your employee. Irs 1040x form Limited Liability Company (LLC). Irs 1040x form  For purposes of this publication, a limited liability company (LLC) is a business entity organized in the United States under state law. Irs 1040x form Unlike a partnership, all of the members of an LLC have limited personal liability for its debts. Irs 1040x form An LLC may be classified for federal income tax purposes as a partnership, corporation, or an entity disregarded as separate from its owner by applying the rules in Regulations section 301. Irs 1040x form 7701-3. Irs 1040x form See Publication 3402 for more details. Irs 1040x form Photographs of missing children. Irs 1040x form  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Irs 1040x form Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Irs 1040x form You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Irs 1040x form Prev  Up  Next   Home   More Online Publications