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501c is a subsection under the
United States Internal Revenue

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Code, or IRC, that designates
certain types of organizations

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as tax exempt.

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The term is also
used as shorthand

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to refer to nonprofit
organizations

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like charities, government
entities, and advocacy

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organizations.

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An organization with
501c status does not

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have to pay federal income tax.

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Also, donations to
certain qualified tax

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exempt organizations
may be tax deductible.

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There are multiple
kinds of 501c--

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including 501c3, for religious,
charitable, scientific,

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literary, or educational
organizations--

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501c4 for organizations
that promote social welfare,

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and 501c6 for business leagues
or chambers of commerce

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that are not
organized for profit.

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501c also includes
fraternal societies

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that operate under
the lodge system

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and provide payment of life,
illness, and other benefits

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for members.

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Teacher's retirement fund
associations are tax exempt,

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so long as income consists
of amounts received

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from public taxation,
assessments based

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on the teaching
salaries of members,

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and income from investments.

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501c status does not
apply automatically

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to organizations that fit
in one of these categories.

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Groups must first
apply and meet all

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of the stipulations
required by the IRS

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before 501c status
can be acquired

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through federal authorization.

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