In 2014, the IRS implemented a new form for organizations seeking nonprofit status. Called the 1023-EZ, the three-page document was designed to make it easier for new groups to attain nonprofit status. And boy has it worked! According to the 2016 IRS Data Book, 79,545 new organizations were granted 501 (c)(3) status status last year. Although this represents a decline from the high of 94,365 approvals in 2014, the 2016 figures are still more than double the approval rate in 2013 (the prior to the implementation of the 1023-EZ form). In total, the IRS Data Book reveals that there were a total of 1, 237,094 501 (c) (3) organizations in 2016!
Previously, on this blog, we've talked about the pros and cons of this trend. On the one hand, more nonprofits could mean more innovation and more progress on our world's most pressing challenges. On the other hand, more nonprofits mean donors have to navigate even more appeals for their support. And since charitable giving has stagnated at roughly 2% of GDP, it means our precious charitable dollars will be spread even thinner across more organizations.
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