Charitable & Tax-Exempt Organizations
Tax-exempt status is the foundation a charity is built on, and the IRS and the state both have rules for earning it, keeping it, and accounting for the gifts that come in. We handle the tax-exemption and charitable-giving work for nonprofits and foundations across the Pacific Northwest, from the first application to the final wind-up.
Talk to an attorneyFounded
1965
Attorneys
11
AV-rated
Martindale-Hubbell
Office
Bellevue, WA
Founded
1965
Attorneys
2
AV-rated
Martindale-Hubbell
Office
Bellevue, WA
Tax-exempt organization attorneys for Bellevue and Seattle nonprofits
Oseran Hahn handles the tax-exempt and charitable side of nonprofit law: getting an organization recognized as exempt, keeping it that way, structuring the gifts and endowments that fund it, and handling the mergers and dissolutions that close a chapter. This is where a nonprofit's biggest risks live, the lost exemption, the excess-benefit penalty, the unreported unrelated income, the mishandled restricted gift. We work with charities, private foundations, and the donors who support them on the federal and Washington rules that govern tax-exempt money, so the mission keeps its advantages and its good standing.
Tax-exempt law runs the length of an organization's life, from the application that creates the exemption to the dissolution that ends it. We obtain 501(c)(3) recognition and the right public-charity or private-foundation classification; we keep the exemption safe from the reporting, inurement, and unrelated-income rules that threaten it; we handle charitable-solicitation registration before the fundraising starts; we structure the planned gifts and endowments that sustain the work; and we manage the mergers, restructurings, and dissolutions that move charitable assets from one chapter to the next.
Obtaining and classifying tax-exempt status
Exemption starts with the application and the classification. We prepare the Form 1023 filing for recognition under Internal Revenue Code section 501(c)(3), and we get the classification right, because whether an organization is a public charity or a private foundation under section 509(a) changes its tax, its reporting, and the rules it lives under. Public charities pass a public-support test; private foundations face a stricter regime. The classification decided at the start determines how the organization operates for as long as it exists, so it is worth analyzing before the application goes in.
Keeping the exemption
An exemption is easier to lose than to get. A nonprofit has to file its annual Form 990 under Internal Revenue Code section 6033, and missing three years running revokes the exemption automatically. It has to avoid private inurement and excess-benefit transactions, where overpaying an insider triggers penalty excise taxes under section 4958. It has to report and pay tax on unrelated business income under sections 511 through 513. And a private foundation has to navigate the self-dealing and distribution rules of sections 4941 through 4945. We keep an exempt organization clear of the traps that quietly put its status at risk.
Charitable solicitation and fundraising
Before a nonprofit asks the public for money, Washington requires it to register. Under the Charitable Solicitations Act, RCW 19.09, most organizations that solicit donations in the state must register with the Secretary of State and renew annually, and commercial fundraisers and fundraising counsel have their own registration duties. Soliciting in other states can trigger their registration rules too. We handle the Washington registration and renewals and advise on multistate fundraising, so a compliance gap doesn't become an enforcement problem or a headline.
Charitable giving, planned gifts, and endowments
The gifts that fund a charity carry their own rules, on both sides. For donors, the charitable deduction under Internal Revenue Code section 170 depends on proper substantiation and, for larger gifts, appraisals. For the organization, planned-giving vehicles, charitable remainder trusts under section 664, charitable gift annuities (which Washington regulates under RCW 48.38), and donor-advised funds, have to be set up and administered correctly. Endowments and other institutional funds are governed by Washington's Uniform Prudent Management of Institutional Funds Act, RCW 24.55. We structure the gift programs and the spending policies so the organization can accept and steward major gifts with confidence.
Mergers, restructuring, and dissolution
Nonprofits combine, restructure, and wind down, and charitable assets carry restrictions through all of it. We handle nonprofit mergers and conversions under Washington's Nonprofit Corporation Act, RCW 24.03A, and the dissolutions that require a charity's remaining assets to pass to another tax-exempt organization rather than to anyone privately. The Attorney General oversees charitable assets in Washington and gets notice of a dissolution, and restricted or endowed gifts may need a cy pres proceeding to be redirected. We manage the wind-up so the assets stay devoted to charity and the organization closes cleanly.
Sixty years advising Pacific Northwest faith communities and mission-driven organizations, across both Christian and Jewish traditions. We keep the legal layer thin so leaders can lead, and we know the constitutional and tax rules that make religious organizations a distinct legal animal.
Decades with faith communities.
We've represented churches, synagogues, parachurch ministries, and religious orders for decades, across traditions. The work is familiar, from formation to succession, so you're not paying us to learn it.
We know where the First Amendment line falls.
Religious organizations are governed by constitutional protections almost no other client has. We structure governance, clergy employment, and property to stay inside those protections rather than stumble into a fight.
We translate, so leaders can lead.
Ministry and board leaders shouldn't have to become lawyers. We keep the legal layer thin and the language plain, and we tell you when a matter is routine and when it genuinely needs attention.
The attorneys behindthe work.
Our business and corporate attorneys handle this work alongside our litigation team, so you have coverage whether your matter stays transactional or becomes something more.
What clientsask us first.
What's the difference between a public charity and a private foundation?
Both are 501(c)(3) organizations, but they're taxed and regulated differently under Internal Revenue Code section 509(a). A public charity draws broad public support and faces lighter rules; a private foundation, typically funded by one source like a family or company, lives under stricter excise-tax rules on self-dealing, payouts, and investments. The classification affects taxes, grantmaking, and donor deductions, so we determine and structure it deliberately, not by default.
How can a nonprofit lose its tax-exempt status?
More easily than most boards expect. The most common way is simply not filing the annual Form 990 for three consecutive years, which revokes the exemption automatically. Others include paying an insider too much (an excess-benefit transaction), letting earnings benefit a private individual, or running an unrelated business without reporting the income. We help organizations file on time and avoid the transactions that put the exemption at risk.
Do we have to register before fundraising in Washington?
Yes, in almost all cases. Washington's Charitable Solicitations Act (RCW 19.09) requires most organizations that solicit donations in the state to register with the Secretary of State before they ask and to renew each year. If you fundraise in other states, their rules can apply too. We handle the Washington registration and renewals and sort out where else you need to be registered.
Can our donors deduct their gifts, and what do they need?
Usually, but the paperwork matters. A donor's charitable deduction under Internal Revenue Code section 170 generally requires a contemporaneous written acknowledgment from the organization, and larger non-cash gifts require a qualified appraisal. Quid-pro-quo gifts, where the donor gets something back, have their own disclosure rules. We help organizations set up acknowledgment and substantiation practices so their donors' deductions hold up.
What happens to our assets if we dissolve?
They can't be distributed to individuals. A dissolving 501(c)(3) must transfer its remaining assets to another tax-exempt organization, and Washington's Attorney General, who oversees charitable assets, receives notice of the dissolution. Gifts that came in with restrictions, or endowment funds, may require a court cy pres proceeding to be redirected to a similar purpose. We manage the dissolution so the assets stay in the charitable world and the closure is clean.
Recentarticles.
Tell us about your organization's tax-exempt or charitable-giving question. An attorney from our nonprofit and church practice will follow up within one business day.
Oseran Hahn P.S. · 11225 SE 6th St, Suite 100 · Bellevue, WA 98004
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