Printable Form 2026

IRS Publication 5406 – Overview of Form 1023 E-Filing

IRS Publication 5406 – Overview of Form 1023 E-Filing – Are you starting a nonprofit and need to apply for federal tax-exempt status under Section 501(c)(3)? IRS Publication 5406 serves as the official overview of the mandatory Form 1023 e-filing process. This clear, step-by-step guide from the IRS explains exactly how to submit your application online through Pay.gov — the only accepted method since January 31, 2020.

Whether you’re a founder, attorney, or nonprofit consultant, understanding Publication 5406 helps you avoid costly delays, rejected paper forms, and common mistakes. In this comprehensive guide, you’ll find everything from prerequisites to post-submission expectations, based directly on the latest IRS resources (Publication 5406, Rev. April 2020, with supporting 2024–2025 Instructions for Form 1023).

What Is IRS Publication 5406?

Publication 5406 (Catalog Number 74171W, revised April 2020) is a concise, slide-style document titled Overview of Form 1023 E-Filing. It functions as the transcript for the free IRS interactive course available on StayExempt.irs.gov.

The publication does not explain qualification rules for 501(c)(3) status (use Publication 557 and the full Instructions for Form 1023 for that). Instead, it focuses exclusively on:

  • What you need before filing
  • How to complete and submit Form 1023 electronically
  • Required PDF attachments
  • Navigation tips on Pay.gov
  • What happens after submission

Download the official PDF directly from IRS.gov: https://www.irs.gov/pub/irs-pdf/p5406.pdf.

Why Must You E-File Form 1023? (Mandatory Since 2020)?

Paper Form 1023 submissions are no longer accepted and will be rejected outright. The IRS requires all applications for recognition of exemption under Section 501(c)(3) to be filed electronically via Pay.gov.

This change (announced in 2020) mirrors the successful rollout of Form 1023-EZ and delivers faster processing, built-in validation, and automatic fee calculation.

Note: Smaller organizations may qualify for the streamlined Form 1023-EZ ($275 user fee). Use the eligibility worksheet in the Instructions for Form 1023-EZ to check.

Step-by-Step: How to E-File Form 1023 (Per Publication 5406)?

Follow these exact steps outlined in Publication 5406:

  1. Prepare Your Organization (Pre-Filing Requirements)
    • Obtain a valid Employer Identification Number (EIN) (apply free at IRS.gov).
    • Have an approved organizing document (articles of incorporation, trust instrument, or association articles) that meets IRS requirements (specific purpose and dissolution clause — see Pub 557).
  2. Create or Sign Into a Pay.gov Account
    • Go to www.Pay.gov.
    • Sign in or create a free account (one account works for all IRS forms).
  3. Start the Form 1023 Application
    • Search for “1023” on Pay.gov.
    • Select Form 1023 (not 1023-EZ) and click Continue.
    • Review the landing page: links to instructions, PDF requirements, and expected IRS contact timeline.
  4. Complete the Online Form
    • Answer all questions using Pay.gov’s guided interface (conditional logic automatically shows relevant schedules).
    • Provide:
      • Organization details (name, address, EIN, officers/directors)
      • Detailed narrative of past, present, and planned activities (≤5,000 characters)
      • Financial data (revenues/expenses for 3–5 years + balance sheet)
      • Compensation practices and foundation classification
    • Use the “?” help icons and save progress frequently.
  5. Prepare and Upload the Required PDF Attachment (≤15 MB) Must be one single PDF containing:
    • Organizing document + all amendments
    • Bylaws (if adopted)
    • Supplemental information exceeding text-box limits
    • Form 2848 (Power of Attorney) or Form 8821 (if applicable)
    • Expedited handling request with compelling reason (if needed)
  6. Pay the User Fee and Submit
    • Current user fee for standard Form 1023: $600 (as of October 2025; always confirm on IRS.gov “user fee” search).
    • Pay by ACH (bank account) or credit/debit card.
    • The authorized signer declares under penalties of perjury; the name auto-populates.
  7. Save Confirmation
    • Pay.gov provides a confirmation. Download and save everything for your records.

Pro Tip from Pub 5406: Never use your browser’s Back button — use only Pay.gov navigation to avoid losing data.

Key Benefits of E-Filing Form 1023

  • Mandatory and faster than old paper process
  • Real-time validation and conditional questions reduce errors
  • Secure PDF upload for supporting documents
  • Instant receipt and payment confirmation
  • IRS tracks and processes in order received (with possible expedited handling for compelling reasons)

Common Pitfalls to Avoid (Direct from IRS Guidance)

  • Submitting paper forms (automatic rejection)
  • Missing the organizing document or using one without required IRS language
  • Including Social Security numbers in any document
  • Exceeding the 15 MB PDF limit (call 877-829-5500 for guidance)
  • Forgetting to save progress on Pay.gov
  • Inconsistent formation dates or missing financial projections

What Happens After You Submit Form 1023?

The IRS will contact you after submission (timeline shown on Pay.gov landing page). Most applications receive a determination letter within several months, though complex cases may take longer. Track status via the IRS Tax Exempt Organization Search tool once assigned a case number.

Filing deadline for retroactive exemption: Generally within 27 months of formation (use Schedule E if requesting exception).

Additional Trusted IRS Resources

Final Thoughts: Use Publication 5406 as Your Roadmap

IRS Publication 5406 removes the mystery from the Form 1023 e-filing process. By following its straightforward guidance and preparing your organizing documents and EIN in advance, you’ll submit a complete, compliant application that moves efficiently through IRS review.

Ready to begin? Start at Pay.gov today and download Publication 5406 for the full visual overview.

Need help? Consult a tax professional or attorney familiar with nonprofit formation. This article is for informational purposes only and is not tax or legal advice. Always refer to official IRS.gov sources for the most current requirements.

Last updated February 2026 based on IRS Publication 5406, Instructions for Form 1023 (12/2024), and official user-fee pages.