The Form 1023 fee is $600, or $275 if your organization qualifies to file the shorter Form 1023-EZ. Both fees are paid electronically through Pay.gov at the time you submit the application, and the IRS treats them as non-refundable in most circumstances.1Internal Revenue Service. Form 1023 and 1023-EZ: Amount of User Fee
Which Fee You Pay
The amount depends entirely on which version of the application your organization is allowed to file. There are two tiers and no sliding scale between them.
To pay the lower $275 fee on Form 1023-EZ, your organization has to clear three financial tests. Annual gross receipts must not have exceeded $50,000 in any of the past three years. Projected annual gross receipts must not exceed $50,000 in any of the next three years. And total assets must have a fair market value of $250,000 or less.2Internal Revenue Service. Do You Have the Required Financial Information Fail any one of these, and you owe the full $600.
For a brand-new organization with no financial history, the projections carry the weight. If you reasonably expect to stay under $50,000 in annual gross receipts and $250,000 in total assets, the 1023-EZ is likely available on the financial side. The eligibility rules go further than the numbers, though.
Who Cannot Use the $275 Form
The IRS eligibility worksheet built into the Form 1023-EZ instructions runs more than 30 questions. Answering “yes” to any one of them means you must file the full Form 1023 and pay $600.
Some organizations are excluded by type. Schools, colleges, universities, and hospitals must always file the full application. So must health maintenance organizations, accountable care organizations, agricultural research organizations, and cooperative hospital service organizations.3Internal Revenue Service. Instructions for Form 1023-EZ
Others are excluded by structure. Organizations that maintain donor-advised funds, supporting organizations, and entities formed under the laws of a foreign country cannot use the 1023-EZ. Neither can LLCs, for-profit conversions, or successors to for-profit entities.3Internal Revenue Service. Instructions for Form 1023-EZ
One reinstatement point is worth being clear about. If your exempt status was automatically revoked for failing to file Form 990 for three consecutive years, you can still use Form 1023-EZ to apply for reinstatement, provided you meet all other eligibility criteria. Organizations revoked for any other reason, or that previously received a denial of exempt status, must use the full Form 1023.3Internal Revenue Service. Instructions for Form 1023-EZ
Organizations That Owe No Fee at All
Not every 501(c)(3) has to file Form 1023 or pay anything. Federal law recognizes two categories automatically. Churches, synagogues, mosques, temples, their integrated auxiliaries, and conventions or associations of churches are treated as tax-exempt without filing. Organizations that are not private foundations and that normally have gross receipts of $5,000 or less per year are also exempt from the filing requirement.4Internal Revenue Service. Organizations Not Required to File Form 1023
These organizations can still choose to file if they want a determination letter, the IRS’s formal written confirmation of exempt status. Banks, grantmakers, and donors often ask for one. But the fee is not required for them to operate as tax-exempt.5Office of the Law Revision Counsel. 26 USC 508 – Special Rules With Respect to Section 501(c)(3) Organizations
How to Pay
The IRS requires all user fees for Form 1023 and Form 1023-EZ to be paid electronically through Pay.gov. You can pay directly from a bank account or with a credit or debit card.6Internal Revenue Service. Form 1023: Methods of Paying User Fee Paper checks and money orders are not accepted.
Once you complete the payment on Pay.gov, you get a confirmation number. Enter that number into the electronic application in the IRS online portal. The system links your payment to your application and will not let you submit without a valid confirmation number matching the correct fee amount.1Internal Revenue Service. Form 1023 and 1023-EZ: Amount of User Fee
Refunds and Underpayment
Treat the fee as money you will not get back. The IRS states that refunds are available only in limited circumstances.7Internal Revenue Service. User Fees for Tax Exempt and Government Entities Division If your application is denied, the fee is not returned.
Underpayment is the more common trap. If an organization files Form 1023-EZ and pays $275 but turns out to be ineligible for the streamlined form, the IRS will suspend the application and require the difference before processing continues. That delay pushes back the determination date and can jeopardize retroactive recognition of exempt status back to the date of formation.8Internal Revenue Service. Form 1023: Purpose of Questions About Organization Applying More Than 27 Months After Date of Formation
Working through the IRS eligibility worksheet before you pay is the most effective way to avoid this. Completing it honestly takes far less time than unwinding a suspended application.
Costs Beyond the IRS Fee
The $275 or $600 user fee is only one line in the total cost of obtaining 501(c)(3) status. Before you can file, your organization has to be legally formed, which means state incorporation fees, articles of incorporation, and usually bylaws. State incorporation fees vary by jurisdiction and generally run between $50 and several hundred dollars.
Many organizations hire an attorney or use a nonprofit formation service to prepare the application. Attorney fees for a straightforward Form 1023-EZ can start around $1,500 to $2,000. The full Form 1023, which requires detailed narrative descriptions of activities, financial projections, and supporting documents, commonly costs $3,000 to $5,000 or more in legal fees. Organizations with complex structures or unusual activities pay more.
After the federal determination letter arrives, most states require a separate charitable solicitation registration before you can legally fundraise from the public. Registration fees vary, with some states charging nothing and others charging a few hundred dollars. Many states also require annual renewals tied to your Form 990 filing.
The IRS fee is fixed and predictable. Everything around it is where costs quietly add up, so budget for the full picture before you start.