Tax Exempt Law Explained For The Everyday Man

Tax exempt law can be complicated, but with enough research it can be an easy thing to understand. There are several things you have to understand to form a basis of knowledge on this subject.  

Tax Exemptible Organizations

  • Religious organizations
  • Charitable or non-profit organizations.
  • Political Organizations
  • Veterans organizations
  • Private Foundations, (non-profit)


In order to apply for a tax exempt status, you must first fill out the appropriate forms. These forms can be found at the IRS website. Once you have filled out the application form you must also apply for an identification number. You will likely need to have open records for three years so that the public may see where the money your organization makes goes. You will then always need to keep on file the past three years of financial records for the public to view from there on out. You will need to make these available and print them out for the public should they ask without charge.   


The IRS has every form needed online in a downloadable form and step by step instructions on how to file your applications. The IRS has many limitations and restrictions on those wishing to become a tax exempt organization. You will have to submit multiple documents about your organization.  


Before visiting the IRS website, you are going to need to come up with an outline of your organization; here are some questions you will need to answer.

  • Are you a religious organization, (church affiliation, missionary organization)?

  • Are you a political organization, if so which party do you represent, do you plan to help in the campaign of a particular party?  

  • Are you a major office for a military organization? The VA is tax exempt and so is any store that sells only to the U.S. military. If you make money from a civilian, you will have to pay taxes.

  • Are you a charitable or non-profit organization? In other words, do you use the funds that come in towards human interest issues? Do you help the homeless, teens, or any issues of the like? As long as the money or funds coming into your organization support only the efforts made to help in a charitable way, you can be tax exempt.

There are many other hoops to jump through before you can be declared as tax exempt. The IRS website has everything you need to know and even the average Joe can figure it out. The easiest way to get through this process is to look at all of the requirements and limitations before you begin the application process. The whole process itself can be time consuming and stressful, however if you understand just the basics, the process can be a little more stress free. You need to one hundred percent positive that you fall under the tax exempt guidelines and limitations before you begin the process so that you do now waste both your time and that of the IRS.