​​​​​​​​​​​​Real Help With Your 501(c)(3) Application

A. Some people, including some IRS agents, may erroneously tell you that you have to go through a private foundation "termination" (the eighth box in Question 1, Part II of the electronic Form 8940.)  That is incorrect.  A private foundation termination is for an organization that has accepted private foundation status and operated as a private foundation in the past.  The instructions for the electronic Form 8940 make it clear that re-classification is the correct choice, asking the applicant to check the Reclassification of foundation status box if "you erroneously determined that you were a private foundation but you were actually qualified, and have continued to qualify, as a public charity since your inception as an organization described in section 501(c)(3)."   Under current Income tax Regulations, new charities that reasonably expect to meet a public support test by the end of their fifth year "actually qualify and have continued to qualify."  (The rules may differ for older organizations, past their first five years, or for organizations that previously had their 501(c)(3) status "automatically revoked" for failure to file Form 990.)


This information is not available in the 2020 revision of Prepare Your Own​​​​

Question 10 - We Were Told We Need To Go Through A "Private Foundation Termination."