What is an NTEE Code?
The NTEE code is a three-digit code that specifies an exempt organization’s purpose. The National Center for Charitable Statistics (NCSS) developed the National Taxonomy of Exempt Entities (NTEE) coding system as a way to categorize nonprofit organizations. The Internal Revenue Service (IRS) uses this system to classify tax exempt organizations into different categories according to their purpose.
Why is it important?
The NTEE code is a quick way for a potential donor or grantor to know what a charity does at a glance. Grant organizations filter for it in applications, potential donors use it to determine which organizations to consider, and other organizations use it as a way to look for potential partners. In addition, smaller organizations filing the IRS Form 1023-EZ must list their NTEE code on their application for tax-exempt status.
How do you choose one for your organization?
First, you must narrow down which category or categories your organization might belong to. The NTEE classification system divides the universe of nonprofit organizations into 26 major groups under 10 broad categories as follows:
I. Arts, Culture, and Humanities – A
II. Education – B
III. Environment and Animals – C, D
IV. Health – E, F, G, H
V. Human Services – I, J, K, L, M, N, O, P
VI. International, Foreign Affairs – Q
VII. Public, Societal Benefit – R, S, T, U, V, W
VIII. Religion Related – X
IX. Mutual/Membership Benefit – Y
X. Unknown, Unclassified – Z