We are a 501(c)(3) organization
A 501(c)’s exemption from certain state taxes is based largely on an organization’s affiliation with its parent entity, assuming that
- The organization is a recognized subordinate under the parent organization’s group exemption
- The parent organization’s group exemption meets the exemption requirements from one or more of these state taxes
- The parent organization’s group exemption has been established on the Comptroller’s records
501(c)(3) organizations are exempt from Texas franchise tax and sales tax.
A federal tax exemption only applies to the specific organization to which it is granted. Note that when an organization changes its structure, it effectively creates a new organization and must reapply for both federal and state tax exemption.
To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization , i.e. , it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.
Organizations described in section 501(c)(3) are commonly referred to as charitable organizations. Organizations described in section 501(c)(3), other than testing for public safety organizations, are eligible to receive tax-deductible contributions in accordance with Code section 170.
The organization must not be organized or operated for the benefit of private interests, and no part of a section 501(c)(3) organization’s net earnings may inure to the benefit of any private shareholder or individual. If the organization engages in an excess benefit transaction with a person having substantial influence over the organization, an excise tax may be imposed on the person and any organization managers agreeing to the transaction.
