Most new charities file one of two IRS forms to be recognized under section 501(c)(3): the full Form 1023 or the streamlined Form 1023-EZ. Both produce the same result if approved, a determination letter confirming your exemption and your foundation classification (public charity or private foundation). The difference is how much you tell the IRS, what it costs, and who is allowed to use the short version.
The IRS instructions state the starting point plainly: any organization may file Form 1023, but only certain organizations are eligible to file Form 1023-EZ.
Side-by-side comparison
| Form 1023 | Form 1023-EZ | |
|---|---|---|
| User fee (IRS page reviewed Oct. 9, 2026) | $600 | $275 |
| How to file | Online only, Pay.gov | Online only, Pay.gov |
| Who may use it | Any organization seeking 501(c)(3) recognition | Only organizations that answer no to all 34 Eligibility Worksheet questions |
| Gross receipts limit | None | $50,000 or less in each of the past 3 years and projected for each of the next 3 |
| Asset limit | None | Total assets of $250,000 or less at fair market value |
| Entity types | Corporation, LLC, unincorporated association, trust | Corporation, unincorporated association, trust (no LLCs) |
| Activity description | Detailed narrative of past, present, and planned activities | Mission or main activities in 250 characters |
| Financial data | Revenue and expenses for 3 to 5 years, plus a balance sheet | None; you check boxes on receipts and assets |
| Organizing document | Uploaded with the application | Not uploaded; you attest that it contains the required clauses |
| Bylaws | Uploaded if adopted | Not uploaded |
| Schedules | Churches, schools, hospitals, supporting organizations, late filers, housing, successors, scholarships | Not available; most of those organization types are ineligible |
| Public charity classes available | All | Only three: 170(b)(1)(A)(vi), 509(a)(2), and 170(b)(1)(A)(iv) |
| Expedited review | May be requested for qualifying reasons | Not available |
| Earlier effective date after 27 months | Can be requested on Schedule E | Must use Form 1023 instead |
| Exception from annual filing | Can be requested in Part IX | Not available; file Form 8940 later |
| Reported processing (IRS page reviewed June 28, 2026) | 80% of determinations within 191 days | 80% within 22 days; 80% within 120 days if further review is needed |
| Public record if approved | Full application and attachments | Short form of checkboxes |
Processing figures change often; our guide to processing time and the user fee explains how to read the current IRS page.
What stays the same
Some things do not change with the form you choose:
- The legal standard. Both forms ask whether you are organized and operated exclusively for exempt purposes, with no inurement, limited lobbying, and no campaign activity.
- The 27-month rule. File within 27 months after the end of your formation month and, if approved, your exemption generally dates back to formation. See the 27-month rule.
- Annual filing. Once you exist, you generally must file a Form 990-series return or notice every year, even while the application is pending.
- Penalties of perjury. An authorized officer, director, or trustee signs either form under penalties of perjury.
A decision guide
Work through these questions in order. The which exemption application tool runs the same logic interactively.
- Are you seeking 501(c)(3) status at all? Social welfare groups, trade associations, and clubs use other forms. See other 501(c) organizations.
- Do you have to apply? Churches and organizations with gross receipts normally not more than $5,000 are not required to, though many apply anyway to get a determination letter.
- Does any worksheet question get a yes? Go through all 34 questions in the Form 1023-EZ guide. One yes means Form 1023. Common reasons: you are an LLC, a church, a school, or a supporting organization; you expect receipts over $50,000 within 3 years; or you plan donor advised funds.
- Are you past 27 months and want an earlier effective date? Use Form 1023 and complete Schedule E.
- Do you need an expedited review, for example because a pending grant depends on it? Only Form 1023 allows an expedite request.
- Will others need to see a detailed record? If you expect to seek state tax exemption, register to solicit in several states, or apply for foundation grants soon, a full Form 1023 gives you a complete, IRS-reviewed record to share.
- If none of the above applies, Form 1023-EZ is usually the faster and less expensive route.
Two hypothetical organizations.
A neighborhood literacy program expects about $30,000 a year in donations for the next three years, owns only some books and a laptop, and is a nonprofit corporation. It answers no to every worksheet question. Form 1023-EZ fits, for a $275 fee.
A youth mentoring program organized as an LLC expects $40,000 this year and $65,000 in year three as it adds sites. It fails twice, once for its entity type and once for projected receipts, so it files Form 1023, for a $600 fee, and prepares a narrative and financial projections.
The cost of choosing wrong
Filing EZ when ineligible wastes the fee and time. The IRS rejects the application and sends a letter explaining why. Under worksheet question 32, an organization previously determined ineligible to file Form 1023-EZ cannot use it again. Misstating facts on the attestations may also affect your ability to rely on a favorable determination.
Filing Form 1023 when EZ would work costs more and takes longer, but nothing is lost legally. Some founders choose it deliberately for the fuller record.
Waiting too long to decide can cost the most. Whichever form you choose, the 27-month rule runs from the end of your formation month. Gather your documents early, run the worksheet honestly, and file once your answers are settled.
Re-check the worksheet before you file. The January 2025 Instructions for Form 1023-EZ modified question 29 and added questions 31 through 34, which cover prior denials, prior ineligibility findings, federally prohibited controlled-substance activities, and digital assets. A worksheet completed from an older revision may give the wrong answer.
Frequently asked questions
Is a 1023-EZ approval worth less than a 1023 approval?
Legally, no. Both are determination letters recognizing exemption under 501(c)(3), and donors can rely on either. The practical difference is the documentation behind the letter, which some states, funders, and partners may ask you to supplement.
Can we switch from EZ to the full form later?
There is nothing to switch once you are approved; you are exempt either way. If your EZ application is rejected for ineligibility, you file Form 1023 and pay its fee.
Our receipts will cross $50,000 in year two. Which form?
Form 1023. The worksheet asks whether you project gross receipts over $50,000 in any of the next 3 years, so a projected year above the limit makes you ineligible for the EZ.
Does the form affect whether we are a public charity?
The form does not decide it, your sources of support do. But Form 1023-EZ offers only three public charity classifications. If you need another, such as a supporting organization, you must file Form 1023. See public charity vs. private foundation.
Sources
- IRS: Instructions for Form 1023 (Rev. December 2024). irs.gov
- IRS: Instructions for Form 1023-EZ (Rev. January 2025). irs.gov
- IRS: Form 1023 and 1023-EZ: Amount of user fee (page last reviewed Oct. 9, 2026). irs.gov
- IRS: Where's my application for tax-exempt status? (page last reviewed or updated June 28, 2026). irs.gov
- IRS: Publication 557, Tax-Exempt Status for Your Organization (Rev. January 2025). irs.gov
IRS forms, fees and inflation-adjusted amounts change. We review this page when the IRS publishes new instructions.
501Nonprofit.com is a private company, not the IRS. This page is general information, not legal or tax advice for your organization. Example organizations and figures are hypothetical.
