Heads up and share this info - IRS Preparing to Remove Tax Exempt Status From Small Organizations that Assumed they were Exempt

IRS Preparing to Remove Tax Exempt Status From Small Organizations that Assumed they were Exempt From Filing Requirements

April 23, 2010. The New York Times, in an article by Stephanie Strom, has called attention to a provision in federal law that will mean that large numbers of nonprofit organizations with revenue under $25,000 that had been exempt from IRA filing requirements will lose their tax exempt status if they failed to file for the past three years under a little known provision of a 2006 statute. The Pension Protection Act, P.L. 109-280 included those requirements and this year marks the end of the three year period. As an IRS press release explained, "The Pension Protection Act of 2006 requires that non-profit organizations that do note file a required information form for three consecutive years automatically lose their Federal tax-exempt status. This requirement has been in effect since the beginning of 2007." The IRS has established web pages and issued a press release earlier this year warning about the loss of status, but there are still likely to be significant impacts from the changed policy.

   Access the IRS webpage on small Nonprofit filing requirements. http://www.irs.gov/charities/article/0,,id=217087,00.html    Read IRS Press Release Explaining Loss of Tax Exempt Status for Nonprofits Who Had Not Filed. http://www.irs.gov/newsroom/article/0,,id=218550,00.html    Read IRS Explanations of Requirements for Small Nonprofits and Regular Files from P.L. 109-280. http://www.irs.gov/charities/article/0,,id=161145,00.html    Read P.L. 109-280. http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_public_laws&docid=f:publ280.pdf