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Nonprofit Law/revoking 501(c)3 status


QUESTION: How would a church revoke it's 501(c)3 status so that it may exist as a 508 tax exempt organization?

ANSWER: Section 508 is available at and it appears that you are referring to the part that certain entities, like churches, do not need to file an Application for Exemption with the IRS and receive the IRS approval in order to be treated like a 501(c)(3) organization.  Even if a church never applies for exemption under section 501(c)(3), if it is organized and operating as a church should, under the law it is treated by the IRS as a 501(c)(3) organization.

However, once a church has received a determination letter from the IRS that it is exempt from federal income taxes as a 501(c)(3) church, there is no reason why such a church would request the IRS to revoke such status.  If you think of a valid reason, let me know and after you give me that information I will reply further.

Harvey Mechanic
Attorney at Law

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.

---------- FOLLOW-UP ----------

QUESTION: 3 reasons to revoke 501(c)3 status:
1) section 6033(a)3 exempts churches from filing those detailed information returns, required of a "religious organization" under 501(c)3.
2) You will notice that the term "mandatory exemption" used in 508(c)1 and 6033(a)3A is only used in these 2 places in the IRC in order to not violate the constitutional limitation regarding religion of "Congress shall make no law...". That being said, removing the 501(c)3 status of"religious organization" for the constitutionally protected term of "church" should remove the ability of the government to revoke ones non-taxable status.
3) Also this should remove the governments ability to regulate the content of the churches sermons by threatening to remove ones 501(a) exemption.

1.  A church, whether having received a determination letter from the IRS or one that has not, both have the same filing requirements.  The IRS only requires returns if they have unrelated taxable income.

2.  No.  See the first sentence of Church of Gospel Ministry, Inc. v. United States 640 F. Supp. 96 - Dist. Court, Dist. of Columbia, 1986
--- Start of excerpt ---
The Internal Revenue Service (IRS) revoked the tax-exempt status of plaintiff Church of Gospel Ministry, Inc. (CGM) on February 14, 1985, effective retroactively from the date CGM was founded in 1973.
--- End of excerpt ---

There is no evidence in the record that the Church of Gospel Ministry, Inc. had ever applied for or received IRS determination as to its exempt status.  Noteworthy also is later in the decision:
--- Start of excerpt ---
CGM's claim that it is not required to file tax returns because it is a tax-exempt church under 26 U.S.C. 6033(b)(1) is beside the point because it cannot qualify as a 501(c)(3) tax-exempt organization, which is a prerequisite to the 6033 filing exemption.
--- End of excerpt ---

If if an organization has not received an IRS determination letter that it is a 501(c)(3) organization, therefore, the IRS may revoke the exempt status of the organization.  Even if, by definition of the word "revoke" the IRS can not revoke or take back, still, the IRS may publish, after an audit, that the organization is not a church under IRS regulations and then the result is the same.  Usually the IRS does not first audit the church, but audits the tax returns of the principals of the church.  

3.  Again, the IRS has the same authority over church entities, whether they have received an IRS determination of exemption or not.

In conclusion, I see no good reason for a church to request that the IRS voluntary revoke its exemption determination.  In fact, IRS does not have a procedure to revoke such status other than to rule that the organization is not exempt.  The church may have an avenue in Federal District court by a declaratory judgement action, though.

Harvey Mechanic
Attorney at Law

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.  

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Harvey Mechanic


DO NOT GIVE ME INFORMATION THAT YOU WANT KEPT CONFIDENTIAL. I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "" without the quotes and then add your search terms before hitting enter.


I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.


B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.

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