Not all organizations are subject to the same tax liabilities. In fact, certain groups are granted tax-exempt status, meaning they don't have to pay certain taxes. Tax exemption may be given to organizations based on charity, religion, science, education, literature, et cetera. Groups whose sole purpose is social welfare can also qualify. Labor organizations, business leagues, and agricultural groups may also be tax exempt, as can hobby clubs, country clubs, and fraternal lodges. Many groups for veterans of the United States Armed Forces are not liable for taxes; neither are political organizations. There are other types of organizations that qualify for tax-exempt status, as well. There are two applications to request to be tax-exempt: Package 1023 (ten twenty-three) and Package 1024 (ten twenty-four). Package 1023 is used for charitable organizations, while 1024 is the application for all other qualifying groups. It's possible to find out which organizations have been recognized by the Internal Revenue Service as tax-exempt by obtaining Publication 78. This information can be important if you're making donations and want to deduct the contribution on your tax return. For more information, contact a tax professional.
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