How can you become tax exempt?

Preuming you mean your corporation. Individuals can't be tax exempt. Most information about what entitties have a chance of qualifying is found in Section 501 of the Internal Revenue Code. The application process is a tedious and exacting, as is the on going filings (you will file more and in many ways more complex, more scrutinized and open to public review returns each year to maintain tax exempt status). Some basic information is available at: http://www.irs.gov/charities/article/0,,id=136200,00.html You would generally start with package 1023 or 1024, depending on your type of organization.