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

*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