Why Church Organizations need an EIN

According to current figures with the IRS, there are more than 350,000 churches and other religious congregations in the United States; and thousands more opening their doors each year.

The Internal Revenue Service strongly advises churches to have an Employer Identification Number (EIN), even if it doesn’t have any employees.

A church organization needs an EIN in order to:

Open a bank account
To submit 1099 and W2 forms
To file taxes with the federal government
Get listed as a subordinate in group rulings

What is Church organization EIN?

A church organization EIN is a unique nine-digit identifier issued by the IRS to identify churches and church organization for tax purposes. Most churches apply for and have a non-profit or 501(c)(3) status. This gives these organizations the status of being tax exempt in the eyes of the IRS. Being tax-exempt allows them to take advantage of several exemptions which exist for these types of organizations, churches, and church-operated organizations. As long as a church or church-controlled organization does not lose its tax exempt status, the EIN issued to them will remain the same.

Tax Exemption Requirements

For a church or church organization to be considered tax-exempt under section 501(c)(3) of the Internal Revenue Code, it must be organized and operated for tax-exempt purposes. These purposes include religious, charitable, educational, scientific, literary, or other projects which are conducted to foster the public good.

The IRS allows these types of organizations to apply for the tax-exempt classification of 501(c)(3) status. Churches and church-controlled organizations wishing to pursue tax-exempt 501(c)(3) status are required to submit IRS Form 1023 or a streamlined version of the form by following the instructions and filing IRS Form 1023-EZ.

To determine whether your church or church-controlled organization qualifies for tax exempt status as a 501(c)(3), you may wish to review IRS Publication 557 to find the specific requirements for a church or church-controlled organization to meet all federal guidelines in order to be granted 501(c)(3) tax-exempt status.

The state where a church or church-controlled organization is located will determine its non-profit status while the IRS determines its tax-exempt status. Both the state and the federal government establishes this through the articles of incorporation or trust documents. States granting nonprofit status to an organization can give them eligibility for benefits including property tax, sales, and income tax exemptions.

A copy of the IRS EIN (IRS Form SS-4) application form can be downloaded from the IRS website. Section 9a of the IRS SS-4 form includes a selection for churches and church-controlled organizations. When applying for tax-exempt status and an EIN for your church, be sure to include exact copies of the church’s organizing documents, articles of incorporation, trust agreement or declaration of trust for a trust along with the application.
Once completed, the completed application for 501(c)(3) tax-exemption and accompanying documents should be sent to the address on the application form. Currently, the address to submit the application and required documents via regular mail is at:
Internal Revenue Service
P.O. Box 12192
Covington, KY 41012-0192
When sending your 501(c)(3) tax-exemption and accompanying documents via express mail or another delivery service the address they should be sent to is:
Internal Revenue Service
201 West Rivercenter Blvd.
Attn: Extracting Stop 312
Covington, KY 41011
Once you have all of your documentation, you’ll be free to legally operate under the tax laws designed for churches. You’ll be able to solicit for donations and obtain property for your religious activities.