IRS Awarded 501(c)3 Status to Nearly 80,000 Nonprofits Last Year

The number of organizations granted tax-exempt status grew for the fourth year in a row in 2017, climbing to 79,699, according to Internal Revenue Service data.

That’s up slightly from 2016, when 79,545 designations were approved, according to newly released information from the 2017 IRS Data Book.

The number of 501(c)(3) designations granted to religious and charitable organizations has climbed steadily in recent years, driven at least in part by the introduction in 2014 of the three-page 1023-EZ electronic application as an alternative to the 26-page long form.

The short form is available to organizations with less than $50,000 in annual gross revenue. Critics have warned that the shortened process may make it easier for fraudulent organizations to gain tax-exempt status.

The agency received 85,553 total applications for 501(c)(3) status last year. Forty-two of those were denied, and 5,812 applications were incomplete or withdrawn by the organizations.

Out of the approximately 1.8 million tax-exempt organizations in the United States, about 1.3 million are charities or religious organizations.