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Nonprofit Education

Applying for a 501c3 in Texas

Applying for 501c3 approval may seem like a daunting task for a freshly formed nonprofit organization. If the approval itself is not intimidating enough, the 501c3 application should finish the job nicely. Rather than feeling discouraged or put off by the paperwork, the best course of action is to familiarize yourself with the forms that are needed as part of the 501c3 application process in Texas. 

Most of the forms in question aren’t even filed with the 501c3 application to the IRS. The majority of the forms are actually filed with the state. Knowing which ones go where can save a nonprofit a lot of wasted time. Specifically, knowing which forms to file when incorporating your nonprofit 501c3 in Texas can get your organization off the ground much faster.

Preliminary Documents Are First

Before you can start diving into the forms that need to be filed with the state, you should ensure that you have all of your nonprofit housekeeping done. This includes putting together your bylaws and Conflict of Interest Policy and ensuring that they accurately convey your rules, officer positions, voting procedures, and core values. All board members must sign these policies; the signatures have to be original and not digital or typed in. 

A Texas nonprofit does not need to submit their Conflict of Interest Policy or bylaws straight away. The two documents will be used as supporting documents for other forms, such as the 501c3 application itself.

Incorporating In The State

The first document that must be filed for a 501c3 in Texas is the nonprofit’s incorporation document. You cannot file anything else with the state or the IRS until you’ve incorporated. Think of it as putting the first puzzle piece into play. The Articles of Incorporation, known in Texas as the ‘Certificate of Formation Nonprofit Corporation’, must be filed with the Secretary of State. 

The filing fee for a Texas nonprofit incorporation is $25.00. Processing time varies due to the volume of applications that the Secretary of State is managing at the time, but you can expect to wait at least two to three weeks. Were it a different state, the next step in the filing process would be to file the charity registration. However, under Texas law, most nonprofit organizations are not required to register with the state. 

The only exception is if the organization deals with law enforcement, public safety, or veterans’ organizations. If your nonprofit falls into one of these categories, it must register with the Office of the Attorney General or the Texas Secretary of State to ensure compliance with the state. If your nonprofit does not fall into one of these categories, you have one less thing to worry about when applying for a 501c3 in Texas.

State Tax Exemption

The last document to be filed with the state—though only after a Texas nonprofit receives its determination letter from the IRS—is the state tax exemption application. This form is known in Texas as the “Texas Application for Exemption – Federal and All Others”. It’s a short and sweet form, but it’s necessary to ensure that the nonprofit is exempt from state taxes. 

A copy of the IRS determination letter must be included when you submit the state tax exemption form, to serve as proof that the nonprofit has been awarded 501c3 approval. Both documents should be filed with the Comptroller of Public Accounts, specifically their Exempt Organizations Section. There is no filing fee associated with the filing.

Check All The Right Boxes

The 501c3 application is the only application that does not have a ‘Texas twist’ to it. The application filing for the 501c3 in Texas is no different than for any other state, but you should still take great care to fill out the form correctly. One wrong check or blank answer can result in a rejection from the IRS, which can be very frustrating after a 6- to 8-week processing time. 

Texas charities should look into the different schedules that a 501c3 application offers, especially if the nonprofit is a church, school, or hospital. Nonprofit organizations of that caliber must provide additional information by filling out the aforementioned schedules, which are located toward the back of the application.

Getting Your 501c3 in Texas

In addition to the completed 501c3 application, there are supporting documents that Texas charities must also send to the IRS. These include a signed copy of the bylaws, a signed copy of the Conflict of Interest Policy, and a filed copy of the nonprofit’s incorporation. Last but not least, a Texas nonprofit must include the $600 filing fee, paid by check to the United States Treasury.   

If you represent a nonprofit organization and wish to apply for 501c3 approval in Texas, do not hesitate to contact CharityNet USA. Our professionals will take all of the necessary steps to ensure that you are 100% 501c3 approved, which includes taking care of your paperwork for you. Call us today at 407-857-9002.

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