If we, as a grassroots mental health organization, have filed for our 501(c)(3) status but have not yet been approved, can we do business as a nonprofit and accept funding from a private corporation for services rendered during this application time?
If you have filed your application for recognition of exemption as a charity, the organization must have been created and be in existence. As such, it can start to conduct business. It can accept payments for services rendered. It can also accept contributions from private corporations and individuals, which will be deductible assuming that you receive your recognition of exemption. Private foundations probably won't make grants until you get your letter, but businesses and individuals may be more willing to make contributions now.