Step-By-Step Process
| Site: | OpenLearn Create |
| Course: | 501(c)(3) Status for Neighborhood Associations |
| Book: | Step-By-Step Process |
| Printed by: | Guest user |
| Date: | Saturday, 22 November 2025, 12:08 PM |
1. Step 1: SS-4 Form
The first step to becoming a 501(c)(3) is filing an SS-4 Form with the IRS. The SS-4 Form assigns your association an Employer Identification Number (EIN). Even though your Neighborhood Association does not have employees, you must still have an EIN in order to apply for 501(c)(3) status.
The SS-4 form can be completed on the IRS website.
2. Step 2: Gather Required Documentation
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When starting the process of becoming a 501(c)(3) as a neighborhood association, gathering the necessary documentation is a crucial step. The IRS requires specific documents to be submitted in order to obtain tax-exempt status. Some of the key documentation that you will need to gather includes the association's articles of incorporation, bylaws, financial statements, and a completed Form 1023 application.1
It is important to ensure that all documentation is accurate, complete, and organized before submitting it to the IRS. Make sure to review the requirements outlined in the IRS Form 1023 instructions to avoid any delays in the application process. Keep copies of all documentation for your records and be prepared to provide additional information or documentation if requested by the IRS.
1. Internal Revenue Service, “Form 1023: Required Attachment to Form 1023,” IRS, November 8, 2024, https://www.irs.gov/charities-non-profits/form-1023-required-attachment-to-form-1023, 1.
3. Step 3: 1023/1023-EZ Form
The next step is completing the traditional 501(c)(3) application. If your Neighborhood Association makes less than $50,000/year and has less than $250,000 in assets, you qualify to complete the 1023-EZ Form rather than the traditional 1023 Form, which is a shorter process.1
The 1023-EZ Form can be completed on the pay.gov website.
1. Internal Revenue Service, “Instructions for Form 1023-EZ (01/2025),” IRS, January 7, 2025, https://www.irs.gov/instructions/i1023ez#en_US_202501_publink1000102370, 36-49.
4. Step 4: Keep Financial Records
The IRS requires that all 501(c)(3)s keep records, both financial and non-financial. Financial records could be as simple as an excel spreadsheet. Examples of financial records will be discussed later.
Learn more about IRS recordkeeping requirements on the IRS website.
5. Step 5: Annual Filing
The IRS requires all 501(c)(3)s to file an annual information return. This will give the IRS a snapshot of what your Neighborhood Association has done in the past year. This annual information proves to the IRS that your Neighborhood Association is staying in 501(c)(3) compliance.
This annual information return - Form 990-N (or the Form 990-EZ if gross receipts are less than $50,000) - is due by May 15th each year.