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Contract#68-1012 <br /> The Dispute Settlement Center,Inc. <br /> ATTACHMENT K <br /> 501(c)(3)and TAX EXEMPT STATUS <br /> Orange County Department of Social Services <br /> What is a Private Non Profit Agency? <br /> Answer:A private non profit is an organization that is incorporated under State law and whose purpose is <br /> not to make a profit,but rather to further a charitable,civic,religious, scientific,or other lawful purpose. <br /> The Secretary of State's office grants corporate status to organizations in North Carolina. <br /> What is a 501(c)(3)designation? <br /> Answer:When the agency becomes a state private non profit corporation,it can then apply for 501(c)(3) <br /> designation through the IRS. Once the IRS grants 501(c)(3)status,the organization is exempt from <br /> certain taxes and any donations to the charitable organization are tax deductible. Many individuals and <br /> organizations prefer to make donations to 501(c)(3)private non profits. <br /> Who can obtain a 501(c)(3)designation? <br /> Answer:Any organization or group can apply for 501(c)(3)status,provided their charter or mission <br /> focuses on the non profit's objective. <br /> Another option is to apply for a 509(a)(1)status which falls under the 501(c)(3)umbrella. Being a <br /> 509(a)(1)designates an organization as a tax-free public charity that receives most of its support from a <br /> governmental unit or from the general public.Becoming a 509(a)(1)provides public recognition of tax- <br /> exempt status, advance assurance to donors of deductibility of contributions, exemption from certain State <br /> and federal taxes,and non profit mailing privileges.Organizations that typically qualify are churches, <br /> educational institutions,hospitals,and governmental units. <br /> To learn more about non profits,visit www.irs.gov,or call the tax-exempt helpline at 877-829-4933. <br /> How does a Private Non Profit obtain Tax Exempt Status? <br /> A private non profit must apply to the IRS for tax exempt status.To qualify,applicants must complete <br /> and submit to the IRS Form 1023.Once federal tax exempt status is granted,the private non profit applies <br /> for State tax exempt status by completing Form CD-435 and submitting it to the N.C.Department of <br /> Revenue. <br /> Please attach proof of 501(c)(3)or IRS tax-exempt status to this page. <br />