Difference Between 501c and 501c3
A 501(c) organization and a 501(c)3 organization are similar in designation, however they differ slightly in their tax benefits. Both types of organization are exempt from federal income tax, however a 501(c)3 may allow its donors to write off donations whereas a 501(c) does not.
About 501c
A 501(c)(3) nonprofit corporation is a type of charitable organization that the Internal Revenue Service recognizes as tax-exempt. This type of corporation does not pay income tax on its earnings or on the donations it receives.
501c3 Requirements
Who qualifies for 501c?
The Basic 501c3 Requirements:
- Avoid any purpose that praises or calls for discrimination
- Must have obtained an official status as an association, corporation, or trust
- Provide a reason for their desire to seek tax exemption
- Three-years of existence before applying
Activities and Restrictions
Activities and Restrictions
501(c) organizations are generally free to engage in any lawful activity, while 501(c)(3) organizations are subject to more restrictions on their activities, such as limitations on political lobbying and campaigning.
Differences
What’s the Difference between 501(c) and 501(c)(3)?
501(c) organizations are similar in that they can both be exempt from paying federal taxes. However, donations to a 501(c)(3) organization are tax-deductible, but that is not necessarily the case for other types of 501(c) organizations. 501(c)(3) organizations can’t campaign for political candidates, while other 501(c) organizations can. An organization must meet specific guidelines set by the IRS concerning the cause it supports and the activities it engages in to meet 501(c)(3) criteria.
Conclusion
501(c) vs 501(c)(3) Comparison
501(c).
Additional Information
What are the three types of 501c3?
A 501c3 is tax exempt under Section 501(c)(3). A 501 C )( 10 is a nonprofit social welfare organization. It is also exempt from federal income tax. A 501c3 is an organization exempt from federal tax. A 501 C )( 10 is exempt.