Applications for exemption and miscellaneous determination requests are assigned to exempt organizations specialists for review. If additional information is necessary to make a determination, a specialist will contact the organization for the information. Here’s a list of questions that might be asked on this topic. Organization has not provided information about its members 1. Please provide the name, address, and employer identification number (if applicable) of each of your members. Each of your members must be either (i) an organization described in Section 501(c)(3) and exempt from taxation under Section 501(a) or (ii) a governmental unit described in Section 170(c)(1) (or wholly-owned instrumentality of such a governmental unit). LLC requesting classification under Section 501(c)(3) and has members that are not either Section 501(c)(3) organizations or governmental units 2. In order for an LLC to qualify as a 501(c)(3) organization each of its members must be either (i) an organization described in Section 501(c)(3) and exempt from taxation under Section 501(a) or (ii) a governmental unit described in Section 170(c)(1) (or wholly-owned instrumentality of such a governmental unit). You are formed as an LLC with members that do not meet the above requirements. If it was your intention to operate as an LLC, please explain how you qualify for exemption under IRC Section 501(c)(3) given that some or all your members are neither exempt entities under 501(c)(3) nor governmental units. If you formed as an LLC in error, you may wish to re-form as a non-profit corporation or as an unincorporated association. If you re-form, you must submit: LLC Articles of Dissolution or Certificate of Conversion from LLC to Non-profit Corporation. Either non-profit Articles of Incorporation with proof of filing or if re-formed as an unincorporated association, a copy of the new organizational document signed and dated by two authorized individuals. See question #[XX] for more information regarding the purpose and dissolution language needed in order to meet the organizational test under Section 501(c)(3). New employer identification number (EIN) if the LLC is dissolved and there is a new corporation AND you filed tax returns using the original EIN. If you need a new EIN, you can apply for one at IRS.gov. The following attestation states that you understand that if you’re granted exemption, your effective date of exemption will be the date that you became a non-profit organization (for example, the date of your corporation filing or date your articles of association were adopted). If you agree, sign and return the following: We agree to exemption effective the date we reorganized as a non-profit corporation or unincorporated association. _________________________________ Signature _________________ Date Organization has not submitted a copy of its operating agreement 3. Please submit a copy of your operating agreement, which must contain the following provisions (and indicate where each of the four required provisions is found in your operating agreement): Provisions requiring your LLC’s member(s) to be either (i) an organization described in Section 501(c)(3) and exempt from taxation under Section 501(a) or (ii) a governmental unit described in Section 170(c)(1) (or wholly-owned instrumentality of such a governmental unit). Express charitable purposes and charitable dissolution provisions in compliance with Treasury Regulation Section 1.501(c)(3)-1(b)(1) and (4). The express chapter 42 compliance provisions described in Section 508(e)(1) if the LLC is a private foundation. An acceptable contingency plan in the event that one or more members cease to be Section 501(c)(3) organizations or governmental units (or wholly-owned instrumentalities thereof). Organization has not submitted a copy of its articles of organization 4. Please submit a copy of your articles of organization, which must contain the following provisions (and indicate where each of the four required provisions is found in your articles of organization): Provisions requiring your LLC’s member(s) to be either (i) an organization described in Section 501(c)(3) and exempt from taxation under Section 501(a) or (ii) a governmental unit described in Section 170(c)(1) (or wholly-owned instrumentality of such a governmental unit). Express charitable purposes and charitable dissolution provisions in compliance with Treasury Regulation Section 1.501(c)(3)-1(b)(1) and (4). The express chapter 42 compliance provisions described in Section 508(e)(1) if the LLC is a private foundation. An acceptable contingency plan in the event that one or more members cease to be Section 501(c)(3) organizations or governmental units (or wholly-owned instrumentalities thereof). Note: If you are formed under a state LLC law that prohibits the addition of provisions to articles of organization other than certain specific provisions required by the state LLC law, you may include the provisions above only in your operating agreement. Include an explanation if you are prohibited from including the provisions in your articles of organization under your state's LLC law. Not all of the required language is in organization’s articles of organization 5. Notice 2021-56 requires that an LLC seeking exemption under IRC Section 501(c)(3) must include certain provisions in its articles of organization. The following [is/are] not included in your articles of organization: Provisions requiring your LLC’s member(s) to be either (i) an organization described in Section 501(c)(3) and exempt from taxation under Section 501(a) or (ii) a governmental unit described in Section 170(c)(1) (or wholly-owned instrumentality of such a governmental unit). Express charitable purposes and charitable dissolution provisions in compliance with Treasury Regulation Section 1.501(c)(3)-1(b)(1) and (4). The express chapter 42 compliance provisions described in Section 508(e)(1) if the LLC is a private foundation. An acceptable contingency plan in the event that one or more members cease to be Section 501(c)(3) organizations or governmental units (or wholly-owned instrumentalities thereof). Note: If you are formed under a state LLC law that prohibits the addition of provisions to articles of organization other than certain specific provisions required by the state LLC law, you may include the provisions above only in your operating agreement. Include an explanation if you are prohibited from including the provisions in your articles of organization under your state's LLC law. If you modify your articles of organization and/or operating agreement to include the missing provisions, please submit revised filed/approved documents. Not all of the required language is in organization’s operating agreement 6. Notice 2021-56 requires that an LLC seeking exemption under IRC Section 501(c)(3) must include certain provisions in its operating agreement. The following [is/are] not included in your operating agreement: Provisions requiring your LLC’s member(s) to be either (i) an organization described in Section 501(c)(3) and exempt from taxation under Section 501(a) or (ii) a governmental unit described in Section 170(c)(1) (or wholly-owned instrumentality of such a governmental unit). Express charitable purposes and charitable dissolution provisions in compliance with Treasury Regulation Section 1.501(c)(3)-1(b)(1) and (4). The express chapter 42 compliance provisions described in Section 508(e)(1) if the LLC is a private foundation. An acceptable contingency plan in the event that one or more members cease to be Section 501(c)(3) organizations or governmental units (or wholly-owned instrumentalities thereof). If you modify your articles of organization and/or operating agreement to include the missing provisions, please submit revised filed/approved documents. Representation that provisions are consistent with state law and are legally enforceable 7. Please have a director, trustee or other governing body member (not an authorized representative) sign the following attestation: We represent that all provisions in our articles of organization and operating agreement are consistent with applicable state LLC law and are legally enforceable. _________________________________ Signature _________________ Date Additional information See the complete list of Applying for exemption/Miscellaneous determination sample questions by topic.
