"Can we ask for donations before we get our tax exempt status?
If your charitable, educational, scientific or religious organization submits its application to the IRS by the deadline described above and is approved, the "effective date" of your group’s tax exempt status will be the day it was originally created. This means that contributions that your organization received after incorporation, but before the IRS issued your exemption letter will be deductible.
Because there is, of course, a chance that your application for tax exempt status will be turned down, it is only fair to let your potential donors know that you do not actually have IRS approval yet. "501(c)(3) application pending."
We also waited until we got the determination letter before adding any statements to our literature that donations to the PTO would be tax-deductible. And kmamom is right, tweaking that wording does add credibility and professionalism.
But if you really want to put such a statement while the paperwork is in process, you really should consult the IRS as to what type of disclaimer to use. I probably wouldn't do this myself unless we were pretty fair along in the process and the IRS reviewer had assured me it was all but "in the mail".
On the other hand, a positive note that the organization has applied for 501(c)(3) status and expects to be granted that shortly could be effective if worded properly.
We left out the disclaimer until we actually got the letter of determination. I took MichelleB's advice and plagarized several different fundraising junk mail letters I got. I also mentioned that we're recognized by the state of [New Jersey] as a registered charitable institution, and gave the phone number and website should they decide to check up on us. It also looks rather official, which gives me an immature thrill!
Personally, I think you need to call the IRS and ask them about this. I don't know that you can claim contributions are deductible while your application is in process. Definitely, you'd want a disclaimer (if it's allowed). Please post again and share what you learn.
Here's the number:
IRS Exempt Organization customer service toll-free line 1-877-829-5500. Their hours are 8:00am - 9:30pm EST Monday-Friday.
Hi - we are a new PTO and are preparing membership and fundraising flyers. We are highlighting the fact that contributions are tax-deductible and are filing for our 501c3 status this month. However, I wondered if we should put some disclaimer that our formal exemption is pending and that we are filing for formal status? If so, does anyone have any suggested wording?
