Miracle Update: 501c3 Approval!
A major step on our journey is we needed to be approved for 501c3 status with the Internal Revenue Service. What 501c3 status allows us to do is accept donations that are then tax-deductible to the donor. If you are going to donate $500,000 (please do!), you are certainly going to want the tax deduction for making that donation. And until we were considered 501c3 tax-exempt, we simply couldn’t raise that kind of funds.
So, when we were ready to file for 501c3 status, we had to make the determination of whether we would submit Form 1023 or Form 1023 EZ. The determining factor for us was whether we would raise $50,000 or more. If so, then we needed to submit the long form. If not, then we could submit the EZ form. We definitely intend on raising more than $50,000, so we started to work on the long form.
If you have not filled out this form, you should try it for fun.
It took us many, many hours (thank you Kelsi!) to work through the financials required to accurately depict where we were headed and how we would get there. It was a lot of work, but I’m pretty sure I could tell you how much we need to spend on toilet paper in the third month of the second year of operation! It’s not quite that detailed, but it is a LOT of work.
It was late into the evening/early morning of April 20th, and I was determined not to go to bed until the form was submitted. I completed all of the questions, and there was a place to check a box requesting Expedited Handling. At this point, we were completely ready to start raising funds; 501c3 status was the only thing standing in our way.
I checked the box and wrote a simple letter indicating the need, our services, and the reliance on 501c3 approval to start raising the funds. At about 5 AM, I submitted the form to the IRS. The confirmation message indicated that we had successfully submitted the form and that we should not call to check on the status for 180 days. ONE HUNDRED, EIGHTY DAYS! That is SIX MONTHS!
I then clicked a link to see where they are in processing the requests - first in/first out - and they weren’t working on the ones from six months ago. They were working on the applications submitted EIGHT MONTHS AGO! We have been very patient throughout this process, but I knew we could not wait six to eight months to begin raising funds!
The next day, I sent an email to those that have signed up to help us pray about needs related to the Ranch. One of the items I mentioned was praying that our request for expedited handling of our 501c3 application would be approved. After I clicked send, I wish I could say I walked away in faith believing that God would meet that prayer request. No, instead, I went to the IRS website to see if there was any documentation about expedited handling and what kind of requests get approved.
You know what, there was!
There was a page about what type of letters get approved and what type of letters don’t get approved. As I read through the examples provided, I was horrified to realize that I did everything wrong! My letter looked like I used the “don’t do it this way” as a checklist for writing my letter. The realization that we would not be 501c3 approved for 6-8 months was settling in, and I knew we couldn’t wait!
So, I started further research, and I found a way that we could begin raising funds. It’s called fiscal sponsorship! Basically, that means you work under an already-approved 501c3 organization. All funds go through them and are then dispersed to you. This, of course, comes with a fee, and a lot of hoops to jump through. We were already set up to raise funds through our own donation portal, but that would have to be shut down. And we would have to pay anywhere from 5-10% of our funds raised to the fiscal sponsor for the administrative oversight.
We were not very excited about this option, but it seemed to be the only way to go. The board approved, and I submitted the 20+ page contract to our attorney for review. We were all ready to get started with fiscal sponsorship and to get started fundraising!
On Sunday, May 15th, we stopped by the post office and picked up the mail. We had been out of town, so it had been almost two weeks since we had picked up the mail. As a result, there was a lot to work through! One of the envelopes was addressed to High Point Youth Ranch, Inc. I opened the letter and saw that it was from the Internal Revenue Service. As I read through the words, I couldn’t believe what I was reading!
The letter was dated April 28, 2022. It read, “We’re pleased to tell you we determined you’re exempt from federal income tax…” That was it! We are 501c3 approved! It did not take six to eight months. It only took eight calendar days!
I stood outside the car for a moment in sheer disbelief. Somehow, some way, our request for expedited handling had been approved. And then I remembered…
Several months earlier, I had prayed that God would open the doors in such a way that only He could receive the glory! And this was an undeniable miracle that only came as a result of answered prayer. I am grateful to be on this journey with the Lord and with all of you! Thank you to those that helped us pray. We cannot wait to see what God is going to do next!
I recorded a LinkedIn Live video to tell the story. The recording is below. I apologize for the poor quality - but the audio is good!