Student Organization Resources

1. If you are a brand-new student group with few funds beyond what you receive from IU, the answer is maybe. The tax laws don’t require very small organizations (less than $5,000 in annual gross income) to seek formal recognition of their tax-exempt status, but there are still benefits to being recognized.
2. If your group has been on campus for several years, is stable, and brings in close to $5,000 per year, then yes, you should consider applying to be recognized as a 501(c)(3).
3. If you are not close to $5,000 in revenue per year, but you want to step up fundraising and apply for grants or corporate sponsorships, you may also want to consider applying.
4. If your annual gross receipts exceed $5,000, you must apply to the IRS if you want your organization to be tax-exempt.

A 501(c)(3) tax-exempt entity is an organization that’s exempt from paying federal income tax on income because it exists to pursue charitable and/or educational objectives, or to promote amateur sports competition. These activities have been approved and recognized by the IRS as tax-exempt. “Charitable” is broadly defined and covers the activities of most IU student organizations. There are four steps to becoming a 501(c)(3):

1. Adopt a governing document (bylaws, constitution, etc.) that contains certain required provisions. See III below.
2. [Optional] Decide whether you want to be a nonprofit corporation and accept the associated benefits and responsibilities. If so, incorporate. See IV below.
3. Apply for a federal tax ID number for the organization, called an “employer identification number” or “EIN” for short. See V below. If you decided to incorporate, be sure to complete that process before applying for an EIN.
4. File Form 1023-EZ with the IRS. See VI below.

A governing document is a set of basic operating instructions for your group (see “Sample Articles of Organization” at http://www.irs.gov/pub/irs-pdf/p557.pdf). The university typically gives new student groups a template to use to create a governing document, but to apply to become a 501(c)(3), your governing document must contain some additional provisions (which are provided in the IRS sample document), including:

1. A purpose clause, which confirms that the group will only pursue tax-exempt objectives.
2. A dissolution clause, which describes how the group’s assets will be disposed of if the group dissolves (that is, if it stops being a student group).
3. A prohibited activities clause, which confirms that the group won’t engage in certain activities that are prohibited by the tax laws for tax-exempt organizations.
4. Your governing document should also contain other important provisions that discuss things like procedures for removing members or officers, how group meetings will be scheduled and conducted (and what notice must be given about any meetings), basic descriptions of officer responsibilities, banking procedures, and when the group’s tax year begins and ends (which determines when its tax returns are due). You’ll use these provisions to set up the organization and resolve conflicts that may arise.

1. The advantage is it limits the personal liability of members and officers with respect to their participation in the group.
2. An application to form a “nonprofit corporation” is filed with the Indiana Secretary of State via their website.
3. The state charges a small fee to submit the application ($35 as of 2025).
4. When you apply, you’ll receive instant confirmation of the existence of the corporation.
5. The application requires a statement of purpose and a governing document with a dissolution clause (see III above).
6. During the application process, you’ll need to specify what type of corporation you want to form. Be sure to select “public benefit corporation.” It’s also advisable (but not required) to elect to have members. Student Legal Services can help with the application process.
7. Once your group is incorporated, it must act like a corporation (have a basic business meeting at least annually, have a board of directors, etc.). Satisfying these requirements isn’t overly complicated or time-consuming, and it facilitates good recordkeeping and communication between group members.
8. The corporation must designate and maintain a “registered agent” who is physically present in Indiana. The name and address of the registered agent must be updated with the Indiana Secretary of State (via their website) if there are any changes. You can consider asking your group’s faculty/staff advisor if they will consider serving as its registered agent so that this information doesn’t need to be updated each time a student leader graduates.

1. It’s the tax ID number for your organization (the equivalent of a Social Security number for individuals).
2. You must have an EIN to open a bank account for the organization.
3. DO NOT use your personal Social Security number to open a bank account for your organization or do any business on behalf of the organization (for example, collecting membership dues or other organizational income in a personal Venmo account). The IRS will consider all payments reported to them under your SSN as your personal income, which could create tax liability for you.
4. To obtain an EIN for your group, apply online via the IRS website.
5. If your organization wants to incorporate, complete that process before applying for an EIN (see IV above).
6. You must give the IRS the name and Social Security number of a “responsible party” during the application process. The IRS uses this information to confirm that the request for an EIN is coming from a legitimate person and is not a scam. It also provides a designated contact person for the IRS to reach out to.
7. You should receive an EIN immediately after submitting your application. If you do not receive it immediately, there is an issue with your application. For example, an EIN may already have been issued to another group with a name that’s very similar to yours. An officer of your group will need to call the IRS to see what the issue is.
8. During the application process, when you are asked to specify your organization’s “legal structure,” choose “View Additional Types” and then select “Other Non-Profit/Tax-Exempt Organizations."
9. When you have received your EIN and are ready to open a bank account for the organization, tell the bank that you want to open a nonprofit account, and give them the organization’s EIN.
10. You must file IRS Form 8822-B (Change of Responsible Party) whenever the group’s responsible party changes (for example, when the student who applied for the EIN graduates or otherwise leaves the organization).

If your organization’s annual gross receipts (income from all sources during the 12-month tax period you selected when you got your EIN) are less than $50,000, you can apply by filing IRS Form 1023-EZ. Here’s some information about that process: 

1. The IRS charges a one-time application fee ($275 as of 2025).
2. The application must be filed online through the pay.gov website.
3. If your organization wants to incorporate, complete that process before applying to be recognized as tax-exempt (see IV above).
4. The organization must have its own tax ID number, called an “EIN” (see V above).
5. The organization must have a governing document that contains a purpose clause, a dissolution clause, and a prohibited activities clause (see III above).
6. Pay close attention to Part IV of the application (“Foundation Classification”). Most student organizations are NOT private foundations. If your organization collects dues from members, receives funds from student government or the university, and brings in money from private donations, it is a “public charity,” and you should mark box “2b” under Part IV. DO NOT MARK BOX 3 IN PART IV. Selecting private foundation status triggers complex tax filing obligations.
7. You should apply for recognition as a tax-exempt entity within 27 months of creating your organization and obtaining an EIN.
8. The IRS typically processes applications in 8 to 12 weeks. You’ll receive a “determination letter” from the IRS explaining their decision on your application.
9. Student Legal Services can answer questions about the application process before you file or meet with you to file the application together.
10. If your organization’s annual gross income is more than $50,000, you must file the full Form 1023. The application fee for that form is $600 (as of 2025), and you may need help from a CPA to prepare and file the form.

1. File your organization’s annual informational return with the IRS. Every organization MUST file a return with the IRS every year. If you fail to file a return for three consecutive years, your 501(c)(3) status will be revoked, and you’ll have to reapply. You may also be treated as a for-profit entity, which could mean the organization has to pay income tax.
   1. Groups with less than $50,000 in annual gross income use Form 990-N (the “e-postcard”). It is filed using a free IRS website.
   2. If your group brings in more than $50,000 annually, you should hire an accountant to prepare your return (typically Form 990-EZ, which is more complicated).
   3. If you are a small organization who isn’t required to apply for formal recognition of your 501(c)(3) status, and you choose not to apply, you still must file a return each year, and an officer of the organization will need to call the IRS and ask them to set the organization up in the Form 990-N electronic filing system. This process can be time consuming. Contact SLS with any questions.
   4. The organization’s annual return is due 5 months and 15 days after the end of its tax year. Many groups select a tax year that runs from May through April, and in that case their return would be due by October 15 each year.
2. Register your organization with the Indiana Department of Revenue (the state version of the IRS) at intime.dor.in.gov and file the required informational return every five years. SLS can help you get set up on INTIME.
3. Take advantage of the Indiana nonprofit exemption from paying state sales tax (via application through the INTIME website).
4. If your organization is incorporated, file the required “business entity report” online with the Indiana Secretary of State (at inbiz.in.gov) every two years, and update your registered agent information as needed in years when a report isn’t due.
5. File Form 8822-B with the IRS if the responsible party associated with your federal EIN changes. This form must be prepared and submitted on paper via mail.
6. As needed, update the list of authorized signers for the organization’s bank account(s).

1. If you need help creating your organization’s governing document.
2. If you’re unsure about how to complete any part of a government form, including the forms described above. It's better to postpone filing a form than to file a form that contains incorrect information.
3. If you suspect or discover that your organization hasn’t filed any required government form(s), including tax returns.
4. If you have any other questions about starting or operating your student organization.