501(c)(13) Approval: Form 1024
We finally submitted Form 1024 this week, to establish ourselves as a nonprofit and obtain tax exemption status.
It was definitely not an easy process. We needed:
A copy of our Articles of Incorporation
An Employee Identification Number (EIN)
A copy of our board bylaws
Three years of financials (since this is our first year, we needed to show projected financials for this year, next year, and the following year)
There are few things more humbling than trying to estimate new business profits. There was so much we weren’t planning to do: No salaries, no stock options, no membership fees, no PP&E (at least not for the first couple of years). Our revenue options are basically:
Donations
Grants
Coffee mugs
Regardless, we did the best we could with the revenues and expenses (including the $600 filing fee).
As a 501(c)(13), we also needed to describe whether we would set up a perpetual care fund. This is the auditing cornerstone of a cemetery/crematory nonprofit, as it has a clear money trail and is often overseen by a third party. The majority of our profit will go to this fund, to ensure that the land we’re on is respected and maintained.
Despite our challenges, Form 1024 is far less complicated for a new nonprofit than it is for an existing business seeking tax exemption status, especially if that business has stock options. But it definitely feels like a huge weight is off our shoulders.
As a side note: If you’re starting your own Form 1024 journey and want to see our notes, please feel free to reach out!
