BEST PRACTICE
In order for a publisher to qualify for federal tax exemption under Section 501(c)(3), according to Rev. Rul. 67-4 A, “a publishing organization must be operated exclusively for charitable purposes.” This includes educational and religious purposes and literary and scientific publishing. Rev. Rul. 67-4, 1967-1 C.B. 121 states that four criteria must be met:
- The content contained in the publication must be “educational.”
- Materials must be prepared by following methods that are “generally accepted” as “educational.”
- The material that is distributed is necessary to achieve the exempt purposes of the organization.
- The way the material is distributed must not be the same as regular commercial publishing.
A publication does not meet the criteria for exemption if it is only educational; it must meet the additional criteria. Many organizations which do not meet the criteria to be considered, “Literary” under 501(c)(3) still qualify by being charitable, educational, religious, or scientific.
RESOURCES
Revenue Ruling 60-351
Revenue Ruling 66-104
Revenue Ruling 67-4
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