Subordinate organizations
Encyclopedia
A subordinate organization is one that is under control of the central organization.
According to the United States
IRS
Publication 557 (Rev. Oct. 2010), Tax-Exempt Status for Your Organization this is the definition for a subordinate organization:
"A subordinate organization is a chapter, local, post or unit of a central organization
. A central organization may be a subordinate itself, such as a state organization that has subordinate units and is itself affiliated with a national (central) organization."
A subordinate organization may or may not be incorporated, but it must have an organizing document. A subordinate that is organized and operated by a foreign country may not be included in a Group Exemption Letter
(GEL). A subordinate described in section 501(c)(3) may not be included in a group exemption letter if it is a private foundation described in section 509(c).
If a group exemption letter does not cover your organization, ask your central organization about being included in the next annual group ruling update that is submits to the IRS
.
According to the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
IRS
Internal Revenue Service
The Internal Revenue Service is the revenue service of the United States federal government. The agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue...
Publication 557 (Rev. Oct. 2010), Tax-Exempt Status for Your Organization this is the definition for a subordinate organization:
"A subordinate organization is a chapter, local, post or unit of a central organization
Central organization
A central organization is the main body of a group of organizations.Also, "central organization" refers to something with an aesthetic center, such as a flower. The aesthetic make-up draws the viewer's eye towards the center....
. A central organization may be a subordinate itself, such as a state organization that has subordinate units and is itself affiliated with a national (central) organization."
A subordinate organization may or may not be incorporated, but it must have an organizing document. A subordinate that is organized and operated by a foreign country may not be included in a Group Exemption Letter
Group Exemption Letter
A Group Exemption Letter or is a special letter that is issued by the United States Internal Revenue Service . A GEL pertains to organizations that have been recognized by the IRS as tax exempt organizations....
(GEL). A subordinate described in section 501(c)(3) may not be included in a group exemption letter if it is a private foundation described in section 509(c).
Advice
If an organization is a subordinate one controlled by a central organization (for example, a church, the Boy Scouts, or a fraternal organization), it is necessary to check with the central organization to ensure it has been issued a GEL that covers the organization. If it has, you do not have to file a separate application unless your organization no longer wants to be included in the group exemption letter.If a group exemption letter does not cover your organization, ask your central organization about being included in the next annual group ruling update that is submits to the IRS
Internal Revenue Service
The Internal Revenue Service is the revenue service of the United States federal government. The agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue...
.