How to Make a 1023 Expedited Handling Request

Organizations seeking to be recognized as tax-exempt under Internal Revenue Code Section 501(c)(3) must file Form 1023, Application for Recognition of Exemption. The Internal Revenue Service (IRS) processes these applications in the order they are received, which can involve a significant waiting period. For organizations facing urgent situations, the IRS provides a procedure to request a review ahead of the standard processing order, known as an expedited handling request.

Requesting an expedited review is not a simple or guaranteed process. The IRS grants these requests at its discretion for specific, compelling reasons. An approval for expedited handling does not ensure the application for tax-exempt status will be approved; it only means the IRS will review the case sooner.

Criteria for Requesting Expedited Handling

The IRS outlines a narrow set of circumstances that may justify processing a Form 1023 application ahead of others. These situations are considered compelling because a delay would cause a significant, adverse impact on the organization or the public it serves. The burden of proof is on the applicant to demonstrate a qualifying reason, such as:

• A pending grant from a private foundation or government entity. The grant must be contingent upon the organization receiving 501(c)(3) status by a specific deadline, and the organization must show that the failure to secure this grant would jeopardize its ability to continue its operations. A grant representing a substantial portion of the organization’s budget is a strong example.
• A newly created organization formed to provide disaster relief. This applies where there is an urgent need for charitable services in response to a declared emergency, like a hurricane or flood. The organization’s activities must be directly aimed at alleviating suffering from that specific event.
• An unusual and undue delay in processing caused by an IRS error. This is for instances where the agency has made a specific mistake, such as misplacing a file, not for standard processing times. The organization must be able to document the error and the resulting delay.
• Other compelling reasons that could result in undue hardship for the applicant or the public. This is a subjective standard requiring a strong case, such as a new medical facility that cannot open without 501(c)(3) status to secure funding. Simply needing to begin fundraising is not considered a compelling reason.

Required Information and Documentation

To formally request an expedited review, an organization must prepare a written statement and provide supporting evidence. The written request must clearly articulate the basis for the request and connect the organization’s circumstances to the IRS’s criteria. The letter must contain the organization’s legal name, its Employer Identification Number (EIN), and the date the Form 1023 was submitted. It must also include a detailed narrative explaining the compelling reason for needing an accelerated review and be signed by a principal officer or an authorized representative.

Supporting documentation substantiates the claims made in the written request. For a request based on a pending grant, the organization must provide a copy of the grant commitment letter from the funding source. This letter should specify the grant amount, the deadline for securing 501(c)(3) status, and explicitly state that the funding is contingent upon that status.

If the request is based on disaster relief, the documentation should prove the organization’s direct involvement in relief efforts tied to a recognized emergency. For requests based on IRS error, the organization should provide copies of correspondence, delivery confirmations, and a timeline of events to demonstrate the unusual delay caused by the agency.

How to Submit Your Request

All Form 1023 applications must be submitted electronically through Pay.gov, and the process for requesting an expedited review is integrated into the online form. During submission, a specific question allows an applicant to indicate they are requesting an expedited review. The written request and all supporting documentation must be combined into a single PDF file and attached to the application at this stage.

If an organization decides to request an expedited review after its Form 1023 has already been submitted, the process is similar. The written request and all supporting documents should be uploaded as a single PDF through the same Pay.gov portal where the application was originally filed. Organizations can manage their submitted application and upload additional documents directly through the portal.

After the request is submitted, the IRS will review the information and determine if it meets the criteria. The agency will then contact the organization, by phone or letter, to inform them whether the request has been approved or denied. An approval means the application is moved to the front of the processing queue.

A denial of the request for expedited handling does not negatively affect the Form 1023 application itself. It simply means the application will remain in the standard processing queue and be reviewed in the order it was received. The organization does not have a formal right to appeal the denial of an expedited request, as the IRS’s decision is final.