The IRS has issued a new Form 1024-A, Application for Recognition of Exemption under Section 501(c)(4) of the Internal Revenue Code for an organization that chooses to apply for recognition of exempt status under Section 501(c)(4). Organizations described in Sections 501(c)(2), (5), (6), (7), (8), (9), (10), (12), (13), (15), (17), (19) or (25) will continue to file the traditional Form 1024. New Form 1024-A: Exemption Application For 501(c)(4) Organizations
The IRS rolled out Form 1024-A on February 2, 2018, specifically for organizations seeking tax-exempt status under Section 501(c)(4). This form asks for way more detail than the old Form 1024 ever did.
Applicants are required to provide comprehensive information regarding their officers, directors, and employees, including compensation structures. Additionally, the form requests disclosures concerning any foreign grants or planned international activities.
This guide provides a detailed overview of the Form 1024-A application process. It outlines the specific requirements of the Internal Revenue Service (IRS), instructions for accurate completion of the application, and common pitfalls to avoid. Upon reviewing this material, applicants should be adequately prepared to submit their exemption application effectively.
The following sections provide detailed guidance.
Key Takeaways
- Form 1024-A, introduced on February 2, 2018, mandates that 501(c)(4) organizations submit comprehensive disclosures regarding officers, directors, employees, compensation structures, and foreign activities.
- Organizations are required to submit Form 1024-A electronically via Pay.gov, upload all necessary documentation in PDF format, and remit the $600 user fee online at the time of submission.
- Applicants must provide complete information regarding all officer and director names, addresses, titles, employee compensation exceeding $50,000, organizational relationships, conflict of interest policies, and governance framework.
- Form 1024-A does not supersede the Form 8976 filing requirement. Both filings serve distinct regulatory functions, and organizations must submit both to ensure compliance with Internal Revenue Service regulations.
- Failure to adhere to the 60-day Form 8976 deadline subjects organizations to Internal Revenue Service penalties of $20 per day, up to a maximum of $5,000, and may result in personal liability for officers and directors.
New Form 1024-A for 501(c)(4) Organizations
Official application for recognition of exemption that Section 501(c)(4) organizations are required to submit to the Internal Revenue Service to obtain tax-exempt status. This application mandates comprehensive disclosures regarding an organization’s structure, leadership, financial standing, and operational activities to enable the IRS to determine eligibility for federal income tax exemption.
Detailed Disclosures Required
Form 1024-A requires significantly more information from applicant organizations than previous revisions. The IRS utilizes these expanded disclosure standards to enforce regulatory transparency across all social welfare organizations.
Applicants must provide the following information:
- A complete roster of all officers and directors, including full names, addresses, and official titles, to assist the IRS in evaluating leadership structure and governance oversight.
- Comprehensive reporting on employees receiving annual compensation in excess of $50,000, including exact compensation figures, enabling the agency to review potential conflicts of interest and improper financial disbursements.
- Full identification of existing relationships among officers, directors, key employees, and the entity to identify potential self-dealing or preferential arrangements in commercial dealings.
- Formal written compensation policies accompanying the application, detailing the methodology used to ensure equitable and non-excessive remuneration.
- Detailed conflict of interest policies subject to rigorous IRS review, defining established procedures for addressing circumstances where personal interests conflict with organizational duties.
Specific reporting on foreign grants and international activities within designated sections, including explanations of revenue sources and descriptions of operations conducted
| Required Document | Purpose |
|---|---|
| Bylaws and Articles of Incorporation | Verify organizational structure and governance. |
| Conflict of Interest Policy | Demonstrate ethical decision-making procedures. |
| Financial Statements | Show operational sustainability and fund sources. |
Each attachment serves a purpose. The IRS examines them to confirm an organization follows nonprofit regulations. An organization’s structure, leadership, and compensation practices all require documentation through these supporting files.
Missing attachments represent one of the most common reasons for application delays. A review of filing patterns revealed that incomplete submissions frequently lack critical components like payment transmittals, governance documents, or compensation schedules for staff earning above $50,000. Organizations that submit incomplete packets face processing extensions lasting several weeks.
A thorough pre-submission checklist helps organizations verify that every required document accompanies the Form 1024-A. This prevents unnecessary delays and ensures the Internal Revenue Service can begin reviewing exemption applications promptly.
Inclusion of Form 8718 and user fee
An organization must include Form 8718 with its Form 1024-A application. Form 8718 serves as the User Fee for Exempt Organization Determination Letter Request, and it carries real financial weight. Organizations pay a $600 user fee that accompanies this form.
Per IRS Revenue Procedure guidance on user fees for the Tax Exempt and Government Entities division, referenced in IRS.gov’s Form 8718 instructions, the $600 user fee for Form 1024-A is set under the IRS’s annual revenue procedure. Rev. Proc. 2023-5 established the current $600 rate, carried forward in subsequent annual updates including the 2026 schedule. The fee is paid directly through Pay.gov at the time of electronic submission rather than mailed separately with Form 8718.
This demonstrates exactly where the $600 figure comes from, allowing organizations to verify it hasn’t changed before filing. The Internal Revenue Service requires this payment before processing exemption applications. Organizations cannot skip this step, as the IRS will not move forward without the correct fee.
Payment is submitted through Pay.gov as part of electronic filing, making the process straightforward and secure. Getting this detail right matters because incomplete applications delay the path to 501(c)(4) status.
Proper payment handling prevents common administrative rejections.
Caritas Law Group, P.C. has guided organizations through the fee submission process by preparing complete filing packets that demonstrate correct Form 8718 completion. When applicants confirm their electronic payment through Pay.gov before finalizing the application packet, they eliminate follow-up inquiries about payment status.
This practice streamlines the review process. It gives organizations confidence that exemption applications will move forward without payment-related delays or rejections from the Internal Revenue Service.
Filing of Form 8976 within 60 days of formation
A 501(c)(4) organization must file Form 8976, Notice of Intent to Operate Under Section 501(c)(4), within sixty days of formation. This filing requirement comes directly from the Internal Revenue Service and serves as a critical step in an organization’s compliance journey. Organizations cannot skip this deadline without facing penalties.
The Internal Revenue Service takes this requirement seriously. Missing the sixty-day window triggers financial consequences for nonprofit organizations. Per IRS guidance on the Section 501(c)(4) notification requirement, as summarized in coverage from Venable LLP and Exempt Nexus’s Form 8976 explainer, organizations that miss the 60-day Form 8976 deadline face IRS-assessed penalties of $20 per day, up to a maximum of $5,000.
If an organization doesn’t respond to a written IRS demand to file, the same $20 per day penalty (up to $5,000) can be assessed personally against individual officers and directors. This personal liability risk gives officers and directors real stakes in filing Form 8976 immediately.
Form 8976 operates separately from Form 1024-A exemption applications, so organizations need to handle both filings as distinct tasks. Filing this notice tells the IRS about an intent to operate as a social welfare organization under the tax code. An organization’s formation date starts the clock on that sixty-day deadline.
Organizations should file Form 8976 early rather than waiting until the last moment. This provides a safety buffer against missed deadlines. The notice informs the Internal Revenue Service of status and helps establish a compliance record from day one.
Organizations sometimes underestimate how quickly the sixty-day window closes. One civic group discovered this challenge when founders spent forty-five days drafting their exemption application materials. They assumed that preparing Form 1024-A would satisfy the notice requirement as well.
By the time they realized Form 8976 required separate filing, they had passed the deadline. They faced administrative follow-up that required corrective action. This situation demonstrates why organizations should file Form 8976 immediately after formation, rather than waiting until the main exemption application is ready.
Treating these filings as separate tasks with independent deadlines protects an organization’s compliance standing from the start. This filing requirement applies to all 501(c)(4) organizations, regardless of size or fundraising activities. Treating this deadline as a priority protects an organization’s standing with the IRS and demonstrates a commitment to following tax regulations from day one.
Additional Considerations
Form 1024-A does not replace the obligation to file Form 8976 within the required timeframe. Organizations must submit both documents to stay compliant with Internal Revenue Service regulations. Understanding this dual-filing requirement helps organizations avoid costly mistakes and remain in good standing.
Form 1024-A does not fulfill the requirement for filing Form 8976
Organizations seeking 501(c)(4) exemption status must file two separate forms to satisfy Internal Revenue Service requirements. Filing Form 1024-A alone does not complete an organization’s obligations to the IRS. An organization must submit Form 1024-A as the exemption application, but this action does not satisfy the notification requirement that Form 8976 establishes.
The IRS treats these forms as distinct filings with separate purposes. Form 1024-A handles exemption requests and includes detailed disclosures about officers, directors, employees, compensation policies, and conflict of interest matters. Form 8976, by contrast, serves as notice of tax-exempt status for social welfare organizations. Both documents carry legal weight in the eyes of the Internal Revenue Service and its compliance and enforcement divisions.
An organization must complete both forms to meet all IRS requirements for exemption and notification. Filing Form 1024-A first does not excuse an organization from submitting Form 8976 within sixty days of formation. Many nonprofit organizations make this critical mistake and face serious consequences.
The IRS expects organizations to file Form 8976 separately, even after submitting Form 1024-A with all required attachments and the Form 8718 user fee. Failing to file both forms leaves an organization in a vulnerable position regarding tax-exempt status.
Conclusion
Form 1024-A requires careful attention from 501(c)(4) organizations seeking exemption status. The core requirements that shape this application process are now understood.
Organizations must submit detailed disclosures about relationships, compensation structures, conflict of interest policies, and foreign activities. The process occurs electronically through Pay.gov, where documents are uploaded as PDFs, and the required $600 user fee is paid.
Filing Form 8976 within sixty days of formation remains a separate obligation that carries significant penalties for missed deadlines. The Internal Revenue Service established these requirements to enhance transparency and protect the integrity of the tax system.
FAQs
1. What is Form 1024-A and who needs it?
Form 1024-A is the application social welfare organizations use to apply for 501(c)(4) tax-exempt status with the IRS. Since July 8, 2016, this form became the mandatory way for these groups to seek recognition. It’s completely different from Form 1023 or Form 1023-EZ, which other types of nonprofits use.
2. How is Form 1024-A different from Form 1040?
Form 1040 is what you use to file your personal income taxes each year and claim credits like the earned income credit or child tax credit. Form 1024-A is only for organizations applying for tax-exempt status, not for individuals.
3. Can I get help from the Taxpayer Advocate if I have problems with Form 1024-A?
Yes, the Taxpayer Advocate Service can step in if you face serious issues or delays that aren’t getting resolved through normal IRS channels. They’re an independent group within the IRS that helps taxpayers with problems.
4. Does the IRS offer online training for filling out Form 1024-A?
Yes, the IRS provides helpful resources on IRS.gov, including their Interactive Tax Assistant tool that walks you through compliance and enforcement requirements. These online training materials make the whole process less confusing.
5. What documents do I need besides Form 1024-A?
You’ll need your articles of incorporation, bylaws, and your Employer Identification Number (EIN). Keep these documents secure with identity theft protection, just like you would with sensitive forms like Form W-2 or Form W-4, because the IRS carefully reviews everything before approving your exemption.
Additional reading: What is a Group Exemption
Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. Ellis advises nonprofit and socially responsible businesses on corporate, tax, and fundraising regulations. Ellis is licensed to practice in Washington and Arizona and advises nonprofits on federal tax and fundraising regulations nationwide. Ellis also advises donors with regard to major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form.