Then be sure to send us the money to pay that $400 fee.

That is too bad I would have loved to hear the story behind the locomotive, that would have made for an amazing exhibit not only could information cards be put on various parts to explane there function, the story of why those parts were used and the thought process behind making it that way would have made for an awesome experience for the patrons. The story are important to keep and a lot of railroad organizations have lost that human element in there exhibits.

I've been personally involved in 2 applications in the past 3 years, and they both took an honest year. It might be different for an organization that qualifies for 1040-EZ treatment, but that is few of us.

A pending application certainly does have the force of an approved one, provided your application is within 27 months of formation, and of course, it is approved. Pub 557, page 22. So yes, you may tarry forth and behave as a 501c3 starting the day you file, so long as your approval is inevitable. A competent practitioner in the field will certainly know when that is, or to be more precise, when that is not.

A caterpillar can't claim to be a butterfly, but a cocoon can.

'Then be sure to send us the money to pay that $400 fee'.


Excuse me RCD.....that $400 is yours to find and pay.....then you may have some credibility for others to start donating. Making sarcastic comments like this wont help your cause at all.

Mike Pannell

"I've been personally involved in 2 applications in the past 3 years, and they both took an honest year. It might be different for an organization that qualifies for 1040-EZ treatment, but that is few of us."

Actually, the IRS is more responsive if you pay the premium fare. A year is too long. Next time, get professional help.

Something gave them pause. If you file it properly, 6-9 months is far more common. I am aware of a group that met this past Friday (also railroad related) and was informed by their paid consultant that if they draft their preliminary documents and obtain their certificate of incorporation in the next month or so, and submit a clean 1023, they could have their exemption letter in hand by next spring, as they wish to be operational during 2016.


"A pending application certainly does have the force of an approved one, provided your application is within 27 months of formation, and of course, it is approved. Pub 557, page 22. So yes, you may tarry forth and behave as a 501c3 starting the day you file, so long as your approval is inevitable. A competent practitioner in the field will certainly know when that is, or to be more precise, when that is not."

This statement could be entered as a game piece in a charming little game that's occasionally played in rural Pennsylvania known as "Cow Flop Bingo".

You can certainly go about acting as a tax-exempt pending a successful issuance of an exemption letter, but that doesn't mean OTHERS (read donors) will rely on your application). You might be able to raise some money by engaging in tax exempt activities like cookie sales, but no donor of any sophistication who itemizes is giving you more than a nominal donation without that letter. I rather think attempting to preserve a locomotive is the type of thing that requires more than cookie sale money.

From page 24 of Pub 557.


"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 or 1023-EZ (if eligible). By establishing its exemption, potential contributors are assured by the IRS that contributions will be deductible."

https://www.youtube.com/watch?v=oAKG-kbKeIo

Irregular no doubt: One application was a total charley-foxtrot on OUR side, but pretty clean from the IRS's prespective. It was 14 months despite "Retroactive reinstatement" written all over it. The revocation happened in month 9 of its supporting organization's application waiting in the queue. It was approved in 12 months. Not once did IRS write, call or email - Google Voice logs every inbound call, even hangups. So when a straightforward "expedite" takes longer than a (naturally complex) Type II SO application with a fatal error. Now does that sound to you like "intelligent design" ? No, it sounds like pandemonium.



Exactly right in degree but you have it upside down.

Lack of a determination letter does NOT affect your donor of sophistication. He has the skill and time to look over a copy of your 1023 as filed, and anticipate your approval.

It has no effect on people who don't itemize (they can't take a tax deduction anyway). It doesn't affect friends, family, fans or anyone else who doesn't care about the tax deduction.

The problem is the faceless, anonymous ones - entities who deal with nonprofits in bulk. To them, either you're in Guidestar or not. Techsoup giving software. GivingStation doing employer matches. Vanguard Donor Advised Fund recommending a grant. That PayPal donation button. Having IndieGoGo treat you as a nonprofit rather than as a random. Amazon Smile donations. Kroger rewards program donations. Nonprofit permit imprint at the post office. VerticalResponse emails. Google Apps for nonprofits. Donate-your-car nonprofits. Every vendor waiving sales tax (if that's something your state does). It's the "death of 1000 cuts" - these things add up. The most annoying period is when IRS has approved but Guidestar has not propagated, and you're checking it every day so you can finally start your fundraiser.

Having spent 2 years of my life watching that clock... trust me on that.

Our 501(c)(3) application was submitted in May and approved in September of last year. A glitch was that the determination letter was apparently lost in the mail and we didn't learn about the approval until mid-November when I noticed that it had been picked up by Guidestar. Preparing the application involved a very substantial amount of work by both me and a pro-bono attorney from a major law firm who specializes in non profit work. To put together a bullet proof application and per his recommendation we amended both our articles of incorporation and bylaws to insure there were no conflicts with the requirements of a 501(c)(3) exemption and we established a conflict of interest policy and acknowledgement form to be signed by the board members. The application fees depend on the fiscal size of the organization. I think ours was $850.

With the animosity of Congress towards the IRS in general and the non profit section in particular and the cuts in IRS funding, our time to process the request may no longer be a good indicator. (Please don't interpret this as a opinion on either the IRS or Congress.)

"Lack of a determination letter does NOT affect your donor of sophistication. He has the skill and time to look over a copy of your 1023 as filed, and anticipate your approval. "

Beggar: Hi would you care to donate to my cause?

Donor: Are you a tax exempt organization, eligible to receive contributions that are deductible from income tax?

Beggar: Not yet, but we've submitted our application and you can review our 1023 package (so you can guess whether our application will be ultimately approved and you can deduct your donation without fear that should you be audited the deduction will be disapproved, triggering tax due and interest).

Donor: (Choose one)

a.) Uncontrollable laughter
b.) Get out, and get out now.
c.) See me when you get your letter kid.
d.) You want me to do what?
e.) Donor swings foot as to require you to obtain surgery to extract colorectallly impacted footwear.

Using the previously cited $400 to file, and the five years it has taken soliciting funding, collecting seven dollars a month over that time span would have funded the application with a little change left over.

PC

Name your organization the Great Right Wing Conspiracy Preservation Society, and you may be waiting ten years.

Has it occurred to anybody that if the lousy $400 is an impossibility for this group, their eventual goals are even more impossible by a huge factor? If you want to be treated as a credible organization, you must behave like one.....

dave

Yeah, if he is unwilling or unable to put up a mere $400 of his own money into this cause that he allegedly believes so strongly in, it's difficult to take this effort seriously.

$400 is a whole paycheck for me as a part time worker and a college student money is not something I have a lot of. Also I do pay all expences for this orginazation out of pocket. Also if anyone suports this cause but dosen't like the way the orginazation is going please come aborde on the BOD.

The ugly reality of this is that money is required and will be required and if you can't raise $400, you can't hope to raise the money necessary to acquire, transport, store and maintain a locomotive. $400 is a drop in the bucket compared to the ultimate total cost.

I believe it was stated before, the time spent promoting this as a single-item phantom organization would better be spent persuading an existing organization to acquire an F40.

Which specific F40 are you trying to preserve??

Yeah, it really pays to write your articles, bylaws and 1023 application at the same time. especially when it's something complicated like a type II supporting org. IRS is looking for exactly the right copypasta to be present in those docs, and their documentation on how to prepare the 1023 will tell you all that if you read it diligently.

They also have an "interactive 1023" form now which uses PDF tricks to attempt to self document. Check it out, there are lots of helpful tips I've seen nowhere else.


$400 for small ones. There are thresholds based on what you reasonably expect. If I recall it's $50,000 income in any year (including material donations) or $250,000 in gross assets.

This also qualifies you for the 1023 "E-Z" tax form, which I hear has much faster turnaround than we have experienced.

IRS was trying to develop something called "cyber assistant" which would be an online interactive way to file your 1023. But nothing came of it.

Obviously the F40PH society expects to be "small". I could see that.