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Deep in the Heart of Taxes

Be prepared to justify your tax-exempt status, and you can meet requests with a smile

  • Photo Illustration: Bussolati

Most longstanding private shelters have established their credentials when it comes to their 501(c)(3) status. But for smaller rescue and fostering groups, which are often loosely knit groups of private individuals doing the work in their spare time and often in a piecemeal manner, taking on the paperwork involved may seem daunting. And even well-established nonprofits may confront circumstances in which their status is challenged or questioned, and they need to demonstrate their tax-exempt status—for example, when applying for grants from private foundations or seeking other major financial donations.

Some are intimidated by the process for obtaining exempt status. And for small organizations that don’t own any property, don’t do public fundraising, and don’t feel the need to take charitable contributions deductions for costs they incur for their rescue work, obtaining formal tax exemption may not be valuable. But groups that accept donations will find that most supporters expect, or even demand, that the organization be taxexempt as a condition of making donations.

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