Tax season 2025: This is who can apply for federal tax exemption and how
The aim of tax-exempt status is to support organizations that engage in activities that benefit the public or fulfill certain social or charitable purposes.
Tax season 2025 is underway and goes until the deadline on April 15, 2025.
If you are now turning your attention to your filing, you will likely be wondering how to minimize the amount of tax that you are required to pay. Some, however, may not be required to pay tax at all. Certain organizations are eligible for federal tax exemptions:
- Charitable, Religious and Educational Organizations
- Social Welfare Organizations
- Other Nonprofit or Tax-Exempt Organizations
If you think that your organisation may qualify for a federal tax exemption you need to check that it meets all the requirements outline in the Internal Revenue Code.
The application process for recognition of exemption varies between different types of organizations; you can find all the assistance you need on the IRS’ Tax Exemption FAQ page.
Standard Deduction increase could make you exempt
The federal tax exemption relates to certain types of organizations that are not required to pay tax, or can get their tax bill reduced.
For individual filers, you may be able to eliminate your tax burden with the standard deduction. Each year the IRS designates a certain amount of income per person that is not subject to taxation, which can be deducted from total income to reduce tax liability.
This ‘standard deduction’ changes every year and is also based on your personal situation, with different thresholds for single, head of household, and joint filers.
Here are the standard deduction thresholds for the 2024 tax year:
| Filing status | 2024 |
|---|---|
| Single filers & Married couples filing separately | $14,600 |
| Married couples filing jointly & surviving spouses | $29,200 |
| Head of Household | $21,900 |
Paying taxes is mandatory, but what happens if you don’t have an income to report to the IRS? Even in this situation, you shouldn’t neglect to submit a tax return because you may be eligible to claim tax credits that will land you a refund even if your tax bill is $0.
Is it still necessary to file a tax return even if I don’t have a salary or income?
If you did not earn any income during the previous tax year, you are not required to file a tax return. The minimum income threshold for filing a tax return is adjusted annually by the Internal Revenue Service (IRS) based on various factors such as inflation and your individual tax situation.
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