This 41 slide audio enhanced presentation provides an overview of the steps someone needs to take prior to applying for tax exempt status for a nonprofit entity. It also discusses the application process as well as the responsibilities that accompany tax exempt status. The presentation applies only to 501(c)(3) public charities, not private foundations. Links to other sources of relevant information, such as publication 557 and 4573 are also included.
Type of Material:
In class, homework, lecture.
Flash 10.0 viewer
Identify Major Learning Goals:
To learn how to apply for tax exempt status under IRC Section 501(c)(3).
Target Student Population:
Students enrolled in a federal tax course at the introductory or advanced level. Professionals creating or operating a nonprofit entity that currently is not tax exempt.
Prerequisite Knowledge or Skills:
Some background with the Internal Revenue Code.
Evaluation and Observation
Excellent inclusion of the tasks necessary to form a tax exempt organization, including qualifying requirements, getting an entity identification number (EIN), as well as identifying tasks to be completed before attempting to raise money. The presentation also discusses governance requirements (organizing documents and by-laws), the application process, responsibilities of a tax exempt entity, and available resources to support these efforts. A strength of the resource is its potential for multiple uses. For example, the ease with which the presentation can be paused enables a presenter to emphasize particular relevant links or resources that are cited or mentioned and easily return subsequently to the topic. Alternatively, the module is self-contained and self-explanatory that viewing it could be entirely delegated as a homework assignment to be completed outside of class. Content is accurate and informed by scholarship.
Potential Effectiveness as a Teaching Tool
Applying for Tax Exemption provides a thorough introduction to the subject without being overwhelming to the listener. The presentation integrates material from multiple sources, such as various state requirements and the IRS, that an applicant would need to access prior to applying for tax exempt status. As a result, this learning object is a thorough program that would serve listeners well in helping them realize the main points involved in the application process. The presentation is logically organized in that it builds on concepts progressively, demonstrating relationships between them. concepts are presented in an easy to understand manner. Also, the integration of the links facilitates the ability of instructors to proceed in a desired direction that they wish to emphasize.
Ease of Use for Both Students and Faculty
The design of this learning object is excellent. Interactivity is inherent in this module due to the links provided to IRS web pages shown as well as the plethora of resources available at those links. Users can stop the slide show to investigate any of the websites and easily return to the location where the presentation was paused. Also, using a conversational format which includes questions by Tim the Treasurer of a newly created organization and the Coach from the IRS who provides answers made the time pass quickly and seamlessly. Excellent focus and flow is achieved, because the questions that surface are very natural and relevant. Good vocal inflections serve to maintain interest.
Other Issues and Comments:
This web based training program, which is also downloadable and portable is well designed and very useful. It makes the area of nonprofit organization accessible to any interested user. Also the presence of closed captioning is very helpful if the user wishes to clarify a specific concept by reading a transcript of the presentation. Perhaps the best feature of the course is the fact that in less than 20 minutes, interested listeners become aware of a full set of resources available in this area.