Contents

• Tax Exemption Requirement

  • 501(c)(3) Public Charity

  • Group Exemption

  • Automatically Tax Exempt

  • Can I request an exception to the tax exemption requirement?

   

Tax Exemption Requirement

To be eligible for TechSoup and our providers' nonprofit programs, your place of worship or religious organization must have received recognition of its 501(c)(3) Public Charity tax-exempt status through the Internal Revenue Service (IRS). 

Although places of worship are permitted to self-declare their tax-exempt status with the IRS and benefit from income tax exemption, TechSoup and our providers still require they hold 501(c)(3) tax-exempt status with IRS.  Places of worship may hold 501(c)(3) tax-exempt status independently or as a subordinate under a parent denomination's Group Exemption.

501(c)(3) Public Charity

Places of worship and religious organization that have formally applied and received a 501(c)(3) tax-exempt status from the IRS will be sent a determination letter. A determination letter confirms an organization has received 501(c)(3) tax-exempt status and will include your Employee Identification Number (EIN).

Use the EIN from your determination letter when adding an organization to your TechSoup account.  This will allow TechSoup to confirm your independent 501(c)(3) tax-exempt status.

Group Exemption

Many parent denominations have gone through the process of obtaining Group Exemption status with the IRS. Group Exemption allows "parent organizations" to extend their 501(c)(3) tax-exempt status to their "subordinate organizations", so each subordinate does not have to go through the process of independently acquiring the status. 

Example: Catholic parishes are typically covered under the United States Conference of Catholic Bishops' Group Exemption with the IRS.

Places of worship and religious organizations that hold 501(c)(3) tax-exempt status with the IRS under a parent denomination, typically do not have a determination letter on file.  Instead, they have a Group Exemption Letter from a national parent denomination.  A Group Exemption Letter is an official letter from an officer of your national parent denomination that confirms your organization or place of worship is a subordinate under their group ruling.  It must be composed on your national parent denomination's letterhead and signed by a representative of your parent denomination.  A directory or introduction packet is typically included with the letter.

When adding an organization to your TechSoup account, use your parent denomination's Employee Identification Number (EIN).  This will indicate to TechSoup you are covered as a subordinate under a parent denomination's Group Exemption with the IRS.

Automatically Tax Exempt

Places of worship that are automatically tax-exempt, or self declare, are not eligible for TechSoup or our providers' nonprofit programs.  You will need to acquire 501(c)(3) tax exempt status, independently or under a Group Exemption, before you can be validated by TechSoup.

Churches (a term the IRS uses to define any congregation or house of worship) that meet the requirements of section 501(c)(3) of the Internal Revenue Code are automatically considered tax-exempt and are not required to apply for and obtain recognition of exempt status from the IRS. 

Nevertheless, many churches do seek IRS recognition of tax-exempt status because that recognition provides assurance to church leaders, members, and contributors that a church is recognized as exempt from taxation and is eligible to receive tax-deductible contributions. A church that self-declares its charitable status will not owe taxes; however, doing so is not the same as being confirmed by the IRS for the benefit of donors, who would otherwise have no way of knowing whether a church in fact meets the requirements of section 501(c)(3) if it has not been independently recognized as such. U.S. tax law dictates that a donor would be required to independently demonstrate that a church meets all of the requirements if the donor were to be audited. This is why many donors and offer providers prefer to have the assurance provided by an IRS letter. Without an IRS determination letter, the church and its donors risk that the IRS could later determine that the church did not in fact qualify as tax-exempt.

For more information, see Publication 1828, Tax Guide for Churches and Religious Organizations (PDF).

Can I request an exception to the tax exemption requirement?

No.  TechSoup’s eligibility criteria are based on agreements with our providers and have a strict focus on 501(c)(3) status.  No exceptions to this requirement can be granted by TechSoup.

If you believe your place of worship meets the requirements under Section 501(c)(3), then we encourage you to seek exempt status with the IRS.  Visit the IRS’s Application for Recognition of Exemption for the 501(c)(3) filing process. Our blog post U.S. Nonprofit Startup Resources also has useful information on the process.  Once you receive a determination letter from the IRS indicating your place of worship meets the requirements under Section 501(c)(3), we would be able to qualify your place of worship or religious organization.