tax-exempt status
Charity's legal benefit
Tax-exempt status is a designation granted by government authorities that frees an organization from paying certain taxes, typically income tax.
In the United States, nonprofits, religious institutions, and charitable organizations commonly apply for this status under section 501(c) of the Internal Revenue Code.
Organizations must meet specific requirements and restrictions to obtain and maintain their tax-exempt status, including limits on political activity and private benefit.
The church's tax-exempt status was revoked after it endorsed a political candidate.
- 501(c)(3)Nonprofit tax classification
- tax breakReduction in owed amount
- exemptionRelease from requirement
- charityVoluntary aid for others
- nonprofit organizationMission-focused entity, not profit-seeking
donors · philanthropy · board of directors · bylaws · good standing · foundation · public service · annual report · revocation · taxation policy · charitable deduction · filing requirements · religious institution · endowment · financial planning · public charity · private foundation · community development
tax-exempt statustax liability
Money owed to government
taxable · tax obligation · taxable income · tax burden · assessable