How to Start a 501(c)(4): Forms 8976, 1024-A, and Bylaws

To start a 501(c)(4) social welfare organization, form a nonprofit corporation under your state’s law, get an Employer Identification Number, notify the IRS on Form 8976 within 60 days of formation with a $50 fee, and then decide whether to file Form 1024-A for a formal determination letter. The setup is more forgiving than a 501(c)(3), but the 60-day IRS notice, the annual Form 990, and state-level registration are where new organizations get into trouble.

What a 501(c)(4) Is and Whether It Fits

A 501(c)(4) is a nonprofit operated to promote social welfare — the “common good and general welfare of the people of the community,” in the words of the regulation, focused on “civic betterments and social improvements.”¹ Neighborhood associations, volunteer fire departments, advocacy groups, and civic leagues typically fit here.

The main reason to choose a 501(c)(4) over a 501(c)(3) charity is advocacy. A 501(c)(4) can make lobbying its primary activity without losing its exemption.² The trade-off: contributions are not tax-deductible to the donor. The organization itself pays no federal income tax on revenue tied to its exempt purpose.

Step 1: File Articles of Incorporation With Your State

Every 501(c)(4) begins as a nonprofit corporation formed under state law by filing articles of incorporation with the Secretary of State. Keep the document short, but include the pieces the IRS will look for later:

The organization’s full legal name, distinguishable from other entities registered in your state.
A statement of purpose that says the corporation is operated exclusively for the promotion of social welfare within the meaning of Section 501(c)(4). Avoid catch-all language like “any lawful purpose.”³
A registered agent authorized to receive legal documents. You can act as your own, or use a commercial service, which typically runs $35 to $350 per year.
The names and addresses of the initial directors.
Non-profit and non-inurement clauses stating that no part of the organization’s net earnings will benefit any private individual, which Section 501(c)(4)(B) requires.³

State filing fees vary widely. Some states charge as little as $8; others run above $100 for standard processing, with expedited service costing more.

Step 2: Get an Employer Identification Number

Once the state confirms your incorporation, apply to the IRS for an EIN. The online application issues the number immediately. A faxed Form SS-4 takes about four business days, and a mailed one takes four to five weeks.⁴ There is no fee. You’ll need the EIN to open a bank account and to submit anything to the IRS.

Step 3: Draft Bylaws and a Conflict of Interest Policy

Bylaws are your internal operating rules. They aren’t filed with the state, but the IRS will ask for them if you seek a determination letter, and they resolve internal disputes before they start. Cover at least:

Board structure: number of directors, how they’re chosen, and term length.
Officer roles: titles, duties, and how officers are elected or removed.
Meeting procedures: frequency, quorum, and notice.
A conflict of interest policy for transactions involving board members. The IRS specifically looks for this.
Membership provisions, if the organization has members beyond the board, including voting rights and how membership is granted or revoked.

Keep the articles, bylaws, board minutes, and any IRS determination letter permanently.

Step 4: File Form 8976 Within 60 Days

This is the step most new organizers overlook. Any 501(c)(4) formed after December 18, 2015, must electronically notify the IRS of its intent to operate under Section 501(c)(4) within 60 days of formation.⁵ The clock starts when your state approves the articles, not when you mailed them in.

Form 8976 goes through the IRS electronic registration system with a $50 fee paid through Pay.gov. It asks for the legal name, address, EIN, date and state of formation, and a statement of purpose. Miss the 60-day window and the penalty is $20 per day up to $5,000.⁵

Filing Form 8976 is not an application for exempt status. It’s a notice. You’re telling the IRS you exist and intend to operate as a 501(c)(4). Whether you actually qualify is a separate question, which brings up the next decision.

Step 5: Decide Whether to File Form 1024-A

Unlike 501(c)(3) charities, a 501(c)(4) is not required to apply for a formal IRS determination letter. You can self-declare exempt status after filing Form 8976 and start operating. Many small organizations do exactly that.

Filing Form 1024-A for a determination letter has real advantages as an organization grows:⁶

Official proof of tax-exempt status, which grant-makers, partner organizations, and government agencies often require.
State tax exemptions. Many states won’t grant state income or sales tax exemption without an IRS letter.
The U.S. Postal Service nonprofit mailing discount, which requires evidence of tax-exempt status.

Without a letter, you’re relying on self-certification. If the IRS later audits and concludes you never qualified, you could owe back taxes on income from the date you began operating.

What Form 1024-A Requires

The application is filed electronically through Pay.gov with a $600 user fee.⁷ The IRS wants:

A narrative description of what the organization does, has done, and plans to do, showing that promoting social welfare is the primary activity.
Current budgets and projected income and expenses for the next three years.
Disclosure of any lobbying or political campaign activity, including amounts spent.
Any related-organization ties for officers or directors who also serve with or have ownership in entities you do business with.⁸
Copies of the articles of incorporation and bylaws as attachments.

The narrative in the application should match the statement of purpose in the articles. Inconsistencies are one of the most common reasons the IRS sends follow-up questions or delays a decision. Most applicants receive a determination letter within three to seven months.

Rules on Lobbying and Political Activity

The advocacy freedom that makes 501(c)(4) attractive comes with lines you can’t cross.

Lobbying is broadly permitted. The IRS states that “seeking legislation germane to the organization’s programs is a permissible means of attaining social welfare purposes” and that a 501(c)(4) “may further its exempt purposes through lobbying as its primary activity without jeopardizing its exempt status.”²

Political campaign activity is different. Directly supporting or opposing candidates for public office is allowed only if it isn’t the organization’s primary activity.¹ The IRS has not published a bright-line percentage, but social welfare activities must clearly outweigh campaign spending.

When a 501(c)(4) does spend on political campaigns, Section 527(f) imposes a tax at the highest corporate rate on the lesser of net investment income or the amount spent on political activity.⁹

Annual Filings and How Exemption Is Lost

Getting set up is the easy part. Staying compliant is where organizations fail, and the penalty is severe: miss three consecutive annual returns and the IRS automatically revokes your tax-exempt status, with no warning and no discretion.¹⁰

Which annual return you file depends on size:

Form 990-N (e-Postcard) for gross receipts normally $50,000 or less.
Form 990-EZ for gross receipts under $200,000 and total assets under $500,000.
Form 990 for gross receipts of $200,000 or more, or total assets of $500,000 or more.

The return is due the 15th day of the fifth month after your tax year ends — May 15 for calendar-year organizations. Extensions must be filed before the deadline. After automatic revocation, the organization files Form 1120 and pays corporate income tax, and reinstating exempt status requires going through the application process again.

Your Form 990 must be available for public inspection for three years after the filing due date. If you obtained a determination letter, the application and letter must also be available on request.¹¹ Donor names and addresses are not subject to public disclosure, and Form 8976 is not either.¹²

State Registration and State Tax Exemption

Federal exempt status does not automatically exempt you from state taxes. Most states require a separate application for state corporate income or sales tax exemption, and many will not process it without an IRS determination letter. That is another practical reason to file Form 1024-A even though it isn’t federally required.

If you plan to solicit contributions from the public, many states also require registration, usually with the attorney general’s office or secretary of state, before you fundraise.¹³ Roughly 39 states and the District of Columbia have some form of charitable solicitation registration requirement, with initial filing fees generally ranging from $0 to a few hundred dollars. Soliciting before registering can bring fines and, in some states, an order to stop fundraising. Some local governments add their own registration rules on top of the state’s.

Contact your state attorney general and secretary of state early in the process, before you raise money or claim any state tax exemption, to confirm what applies to your organization.

1
eCFR. 26 CFR 1.501(c)(4)-1 Civic Organizations and Local Associations of Employees
2
Internal Revenue Service. Social Welfare Organizations
3
Office of the Law Revision Counsel. 26 USC 501 – Exemption From Tax on Corporations, Certain Trusts, Etc.
4
Internal Revenue Service. Instructions for Form SS-4
5
Internal Revenue Service. Electronically Submit Your Form 8976, Notice of Intent to Operate Under Section 501(c)(4)
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Internal Revenue Service. Instructions for Form 1024-A
7
Internal Revenue Service. About Form 1024-A, Application for Recognition of Exemption Under Section 501(c)(4) of the Internal Revenue Code
8
Internal Revenue Service. Instructions for Form 1024-A
9
Office of the Law Revision Counsel. 26 USC 527 – Political Organizations
10
Internal Revenue Service. Automatic Revocation of Exemption
11
Internal Revenue Service. Public Disclosure and Availability of Exempt Organizations Returns and Applications – Documents Subject to Public Disclosure
12
Internal Revenue Service. Public Disclosure and Availability of Exempt Organizations Returns and Applications – Contributors Identities Not Subject to Disclosure
13
Internal Revenue Service. Charitable Solicitation – State Requirements