What does the 2015 IRS Data Book Tell Us?

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Each year the IRS publishes a “Data Book” that presents information about all the functions of the IRS in a calendar year: ranging from revenue collection and refunds issued, to enforcement actions. For those seeking information on charitable nonprofits, the Data Book allows us to review year-to-year trends and learn such details as the number of charitable organizations that applied for tax-exemption in that year. The 2015 Data Book sports a new online format with lots of graphs and data visualizations. So what’s in the new Data Book of interest for charitable nonprofits?

First, there is a page of the Data Book devoted to the IRS’ tax-exempt activities. The data in this section show that in 2015 there were almost 1.2 million charitable nonprofits recognized as tax-exempt under 501(c)(3); 66,606 more than in 2014. (The number for 2015 was 1,184,547, according to Table 25; in 2014 the total number was 1,117,941.) However, the actual number of tax-exempt charitable organizations is likely much larger because there are charitable organizations that are not required to apply for recognition of tax-exempt status such as religious congregations, including churches, mosques, temples, and other integrated auxiliaries of religious organizations (other than private foundations) that do not normally receive more than $5,000 in gross receipts each year. Bottom line: if someone asks you, “How many charitable nonprofits are there in the US?” you can answer "at least 1.2 million.”

By searching on the page that reports state data, you can find out how many tax-exempt organizations filed returns state-by-state. For instance, in the state of Maryland in 2015 there were 29,030 returns filed by tax-exempt organizations, while in the state of Mississippi there were only 9,768. The total number of “returns” filed includes the 990-T (tax information returns reporting unrelated business income.)

There is also a pdf version of the 2015 Data Book that includes supplemental graphs, such as a graph showing how many applications for tax-exempt status from charitable nonprofits were approved in 2015 (86,915) and how many were “disapproved” (57). An additional 5,681 applications for tax-exempt status are logged in the “other” category, defined as applications that were, “withdrawn by organizations, applications that did not include the required information, incomplete applications, IRS correction disposals, and others.”

Overall the data presented in the 2015 Data Book are also a useful reminder that the term “nonprofits” is misleading. There is quite a large universe of organizations, such as social and recreation clubs, business leagues, fraternities, veterans’ organizations, labor unions, and others, that are also classified as “tax-exempt” under other subsections of Section 501(c) of the Internal Revenue Code. The tendency of the media and others to lump all of these groups together as “nonprofits” is why the National Council of Nonprofits often uses the phrase “charitable nonprofits” in order to distinguish the charitable community from other “nonprofits,” including nonprofits that may be formed in part for political purposes that are tax-exempt under 501(c)(4) as “social welfare groups.” Using the phrase “charitable nonprofits” also helps distinguish charitable organizations from private foundations, that they are also classified under 501(c)(3).

For more data about charitable nonprofits, especially those that can help illustrate the state-by-state environment in which charitable nonprofits operate, and the impact of charitable nonprofits in a state, such as on its economy and the quality of life of its citizens, see our collection of “state sector reports” that State Associations of nonprofits produce to increase awareness and understanding about charitable nonprofits in their states.

Resources

Research, Reports, and Data on the Nonprofit Sector

National Center for Charitable Statistics

GuideStar

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