Welfare and Veterans' Organization Exemptions Organizational Requirements

One of the basic requirements for the welfare exemption is that the organization must be organized and operated for religious, hospital, scientific, or charitable purposes. Property owned by an organization may be eligible for the welfare exemption only if the nonprofit organization is organized and operated for these purposes. Organizations that intend to claim the welfare or veterans' organization exemption and do not currently hold a valid Organizational Clearance Certificate are required to file a claim form requesting an Organizational Clearance Certificate.

Board of Equalization staff will review claims for organizational clearance certificates filed by organizations that intend to claim the welfare or veterans' organization exemption to determine if the organization is organized and operated exclusively for a qualified purpose(s), and otherwise meets the requirements of section 214. The claim must be accompanied by organizational documents and must include the corporate identification number and mailing address. Organizational documents include the following:

• Articles of Incorporation (and other formative documents), to include
  Irrevocable Dedication Clause
  Dissolution Clause
  See Property Tax Rule 143, Requirements for Irrevocable Dedication Clause and Dissolution Clause for Organizational Clearance Certificate for Welfare Exemption. Also, Assessors' Handbook Section 267, Welfare, Church and Religious Exemptions includes a discussion on irrevocable dedication and dissolution clauses on pages 20-23 and Appendix C.
• Tax Exemption Letters
• Financial Statements of Organizations

If the Board determines that an organization qualifies, the Board will issue an Organizational Clearance Certificate; the claimant will provide a copy of the certificate with claim forms filed in any of the 58 counties.