Exactly what to do
- 1. Public charity, not a private foundation. Private foundations cannot be SGOs; your 1023 requested public-charity classification (stage 1, step 6). Verify anytime in the IRS Tax Exempt Organization Search.
2. Documents that REQUIRE §25F compliance. The bylaws template’s Article VIII (step 4) turns every rule in this stage into a governing-document requirement, which is exactly what states are expected to verify before listing you.
3. A segregated §25F account. Opened in step 7, used exclusively for qualified contributions, never co-mingled. (Going multistate later? Treasury has previewed per-state segregation as the safe practice; treat one account per state as the recommended path until the regulations settle it.)
All three true? Check this off and move on.
Questions people actually ask
We wrote our own bylaws. What must they require?
They must require, not merely describe, each rule in this stage: 90/10 spending, 10+ students across more than one school, the award priority order, no earmarking, income verification, no scholarships to insiders, and segregated §25F accounts. Treasury previewed that SGO self-certification will NOT suffice: states must independently determine your documents mandate compliance, which is why generic borrowed bylaws are expected to fail vetting.
What keeps us a public charity over time?
Genuinely broad support: many donors rather than one funder. §25F pushes you the right way, since the credit recruits many $1,700-scale donors. Watch it if a single family or foundation would otherwise dominate your revenue.
