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26 U.S. Code § 508 – Special rules with respect to section 501(c)(3) organizations

(a) New organizations must notify Secretary that they are applying for recognition of section 501(c)(3) status

Except as provided in subsection (c), an organization organized after October 9, 1969, shall not be treated as an organization described in section 501(c)(3)—

(1) unless it has given notice to the Secretary in such manner as the Secretary may by regulations prescribe, that it is applying for recognition of such status, or
(2) for any period before the giving of such notice, if such notice is given after the time prescribed by the Secretary by regulations for giving notice under this subsection.

(b) Presumption that organizations are private foundations

Except as provided in subsection (c), any organization (including an organization in existence on October 9, 1969) which is described in section 501(c)(3) and which does not notify the Secretary, at such time and in such manner as the Secretary may by regulations prescribe, that it is not a private foundation shall be presumed to be a private foundation.

(c) Exceptions

(1) Mandatory exceptions

Subsections (a) and (b) shall not apply to—

(A) churches, their integrated auxiliaries, and conventions or associations of churches, or
(B) any organization which is not a private foundation (as defined in section 509(a)) and the gross receipts of which in each taxable year are normally not more than $5,000.

We do the heavy lifting. We actually prepare your documents for you, including your bylaws. Our process saves you hours of time and gives you peace-of-mind knowing that all of your compliance documents, including bylaws, have been carefully and thoroughly reviewed for final approval.

We pair you with a 508 Compliance Specialist. A real person! Your Specialist discusses your mission with you and collects the basic information needed to get started. From there, your specialist actually prepares your documents and sends them to you for you to review. Take advantage of their wealth of experience in setting up churches and religious organizations to operate under Section 508(c)(1)(A).

Once you sign up, you can expect to hear from your 508 Specialist within one business day to schedule your initial consultation.

We actually prepare your filing and documents, including your bylaws, and file for you with simple pricing — which includes filing fees.

When you get started with us, you’ll receive an email within minutes with a link to schedule your initial consultation with a 508 Compliance Specialist. Our goal is to have your nonprofit filing completed within 21 days.

All Formation Pricing includes at least the following:

1. 508 Membership (Optional)
2. Basic Name Availability Search
3. Articles of Incorporation
4. Certificate of Incorporation
5. SS4 Federal EIN Tax Identification Number*
6. Registered Agent Services*
7. Attorney-Reviewed Bylaws & Required Policy Documents Created
8. Customizable & Attorney-Reviewed Organizational Document Templates including Conflict of Interest Policy, Donation Letter, Board Meeting Minutes, Independent Contractor Agreements, and More
9. Customizable & Accountant-Reviewed Financial Document Templates
10. Group Training and Support Sessions

*If Needed

As little as 3 to 4 weeks! When you get started with us, you’ll receive an email within minutes with a link to schedule your initial consultation with a 508 Compliance Specialist. Our goal is to have your new 508(c)(1)(A) filing completed within 21 days but the process can take more than 30 days due to circumstances outside our control.

We will then work with you through multiple Group Training and Support sessions to create the first draft of your bylaws within 30 days of filing. Your organization’s bylaws are considered a legal document that dictates how your religious organization must be governed and should be finalized and approved by your board within 6 months of your completed filing. For your peace-of-mind, every aspect of your formation documents and policies, including bylaws, have been reviewed by an attorney to ensure full legal compliance.

Yes, we do! We ask for a little bit of information from you when you complete our online application form, such as your religious organization’s name, brief mission details, and your contact information. Your 508 Compliance Specialist reviews that information and discusses the details with you. We will then prepare all your required formation documents and complete your filing.

Your 508 Specialist manages the entire process, eliminating hours spent researching and preparing documents, writing your own bylaws, and other time-consuming tasks.

Yes. Religious organizations that qualify to operate under Section 508(c)(1)(A) are a special kind of 501(c)(3) nonprofit that enjoy tax-exempt status without obtaining official recognition from the IRS.

Congress has enacted special tax laws that apply to churches, religious organizations, and ministers in recognition of their unique status in American society and of their rights guaranteed by the First Amendment of the Constitution of the United States. Churches and religious organizations are generally exempt from income tax and receive other favorable treatment under the tax law; however, certain income of a church or religious organization may be subject to tax, such as income from an unrelated business.

Section 508 allows any religious nonprofit that meets the IRS’ definition of a “church” (see next FAQ below) to claim 508(c)(1)(A) status. Some examples of ministries or programs that could be structured to satisfy this standard include:

• Abuse Ministry
• Addiction Ministry
• Chaplaincy Program
• Church (Local In-Person)
• Church (Virtual or Online)
• Discipleship Program or Ministry
• Divorce Ministry or Support Group
• Drug or Alcohol Ministry
• Elderly Ministry
• Homeschool or Co-op Group
• Mentoring Program
• Music Program or Ministry
• Resource Materials
• School (In-Person or Virtual/Online)
• Family Ministry
• Friendship/Fellowship Ministry
• Handicapped Ministry
• Healing Ministry or Service
• Home Visitation Ministry
• Homeless Program or Ministry
• Hospital Ministry
• Marriage Counselor
• Marriage or Singles Ministry
• Men’s Ministry
• Overcomers Ministry
• Parachurch Organization or Ministry
• Prayer Ministry
• Pregnancy or New Mother’s Ministry
• Sign Language Ministry
• Special Needs Ministry
• Substance Abuse Ministry
• Victims Ministry
• Widows Ministry
• Women’s Ministry
• Youth Crisis Ministry
• Youth Group or Ministry

The term church is found, but not specifically defined, in the Internal Revenue Code (IRC). However, the use of the term church also includes conventions and associations of churches as well as integrated auxiliaries of a church. According to the IRS, they use term church in its generic sense as a place of worship. Therefore, when The 508 Company refers to churches, we are also referring to home fellowships, synagogues, mosques, temples, and other houses of worship.

In analyzing whether a religious organization may properly be characterized as a church for purposes of Section 508(c)(1)(A), the IRS considers whether the organization has at least some of the following characteristics. These attributes of a church have been developed by the IRS and by court decisions. They include:

1. a distinct legal existence,
2. a recognized creed and form of worship,
3. a definite and distinct ecclesiastical government,
4. a formal code of doctrine and discipline,
5. a distinct religious history,
6. a membership not associated with any other church or denomination,
7. an organization of ordained ministers,
8. ordained ministers selected after completing prescribed studies,
9. a literature of its own,
10. established places of worship,
11. regular congregations,
12. regular religious services,
13. schools for religious instruction of the young,
14. schools for the preparation of its ministers, and
15. any other facts and circumstances that may bear upon the organization’s claim for church status.

The IRS makes no attempt to evaluate the content of whatever doctrine a particular organization claims is religious, provided the particular beliefs of the organization are truly and sincerely held by those professing them and the practices and rites associated with the organization’s belief or creed are not illegal or contrary to clearly defined public policy.

The 508 Company will work with you during the formation process to ensure your religious organization possesses enough of the above characteristics, thereby assuring your organization qualifies for operation under Section 508.

The term integrated auxiliary of a church refers to a class of organizations that are related to a church or convention or association of churches, but are not such organizations themselves. In general, the IRS will treat an organization that meets the following three requirements as an integrated auxiliary of a church. The organization must:

• Be described both as an Internal Revenue Code section 501(c)(3) organization and be a public charity under Code section 509(a)(1), (2), or (3),
• Be affiliated with a church or convention or association of churches, and
• Receive financial support primarily from internal church sources as opposed to public or governmental sources.

Men’s and women’s organizations, seminaries, mission societies, and youth groups, etc that satisfy the first two requirements above are considered integrated auxiliaries whether or not they meet the internal support requirement.

We work with clients who are in a variety of stages of planning. To get started, we need you to complete our Membership Application. This simple form includes your contact information and some basic organization information. Once you complete our Membership Application, you’ll receive an email within minutes with a link to schedule your initial consultation with a 508 Compliance Specialist. This initial consultation is a crucial step to your Specialist getting a better understanding of your mission and ask any questions they may have as they prepare your nonprofit filing and documents for filing.

If you have questions about our services or how to form a religious nonprofit that falls under 508(c)(1)(A), please contact us to speak with a representative.