501c3 Status?

 How does a nonprofit qualify for 501c3 status?  Is that something that happens during initial incorporation?  Or does the business need to demonstrate public or private funding first in order to qualify?

 Does this definition from Wikipedia help?:

Some organizations automatically acquire 501(c)(3) status upon filing of proper organizational documents (e.g., articles of incorporation as a church), at least until annual income exceeds a statutory threshold. Others will not receive 501(c)(3) status until they file an application and supporting documentation to the IRS and have a certification letter issued. The IRS will examine the application and may request five dollars and further financial and organization information prior to granting the 501(c)(3) status. To cover donations made before the letter is issued, the regulations require prompt filing of the application after organization, or after an existing organization satisfies the criteria for 501(c)(3), or after exceeding the income threshold.

Eligibility Criteria for 501 (c)

There are three key mechanisms for an organization to be exempt from federal income tax. The not-for profit organization must be organized and operated exclu­sively for one or more exempt purposes.

Organized: An organization must be prearranged as a company, trust, or unincorporated association. An organization’s systematized documents (articles of incorporation, trust documents, articles of association)

Operated: Because a extensive portion of these non-profit organization’s activities must further its exempt purpose(s), certain other activities are not allowed

Thank you for the information. Easily understood.

Hi, All