Express vs. Enterprise Nonprofit 501(c)3 Package – How to Choose

Q&A 8 - Nicole

 

Yippiekiyay offers two different 501(c)3 packages: Express and Enterprise, these correspond with the two paths – and two application types – the IRS uses to make the Tax-Exempt Determination.

Watch the video below as Nicole, our Formation Specialist, describes the difference between the two so you’ll know which one is right for you.

If your organization expects total receipts under $50,000 per year in any of the first three tax years, you’ll qualify for Express, which uses Form IRS 1023EZ; if you plan to be over $50,000 per year then the Enterprise package, which uses the full Form 1023, is for you.

Chances are, if you have paid staff or rent a facility you’ll break above that line, but many smaller local and volunteer-run organizations remain below $50,000 in the first three years.

If you are starting an unusual type of nonprofit such as a school or hospital, or hold more than $250,000 in assets, this will also require the full Form 1023 Enterprise process to obtain 501(c)3 Tax-Exempt status for your nonprofit.

Many customers ask, “what if we raise more or less than that number?” Don’t worry. The IRS is relying upon an honor system here and since you are in the planning stage, there is no penalty for actual revenues or expenses being higher or lower than what you estimate – but chances are if you have any paid staff, or you rent a facility or require equipment, you’ll qualify for the higher Enterprise path.

The Enterprise process calls for more detail about your nonprofit’s activities and budget versus Express…either way our intuitive online interface means you’ll only spend an average 30 to 90 minutes to complete all of your work, and we handle it from there.

To sum it up, the best path for you depends on how big you’d like your nonprofit to be.

Cheers to you mission,

Jacqui Long | Yippiekiyay

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