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FAILURE TO FILE IRS FORM 990-N COULD COST NON-PROFIT STATUS

Gandalfe

Admin and all around good guy.
Staff member
Administrator
#1
FAILURE TO FILE IRS FORM 990-N COULD COST NON-PROFIT STATUS

Sorry for the caps and do not mean to start a panic, but as this could
apply to many groups represented on this list, wanted to be sure
everyone had a chance to see it. If your US-based nonprofit reports
less than $25K/year in income, you apparently must file a new form with
the IRS every three years. If your group has never filed this form (and
has been tax-exempt for at least three years), failing to file this form
by Monday could result in your group losing its IRS non-profit status.
See http://news.yahoo.com/s/ap/20100515/ap_on_bi_ge/us_charity_deadline
for more - here is an excerpt:

More than 200,000 small nonprofits across the nation are days away from
losing their tax-exempt status because they haven't filed a new form
with the Internal Revenue Service.

[...]

It's most likely the nonprofits aren't aware of the Monday deadline that
only applies to groups that report $25,000 or less in income, excluding
churches. Those organizations may not find out until Jan. 1, 2011, when
they're notified they have to pay taxes on donations they thought were
exempt. And it could be months before their nonprofit status is
restored.

Congress required the form, called a 990-N, when it amended the tax code
three years ago and groups with a fiscal year ending Dec. 31 had until
Monday to meet the deadline.

It's probably a good idea, if your group is in the under $25K boundary,
to check and be sure this form has been filed.

The IRS' page on this form is:
http://www.irs.gov/charities/article/0,,id=169250,00.html It can be
filed electronically and only eight pieces of information are required:

1. Employer identification number (EIN), also
known as a Taxpayer Identification Number (TIN)).
2. Tax year
3. Legal name and mailing address
4. Any other names the organization uses
5. Name and address of a principal officer
6. Web site address if the organization has one
7. Confirmation that the organization's annual gross receipts are
normally $25,000 or less
8. If applicable, a statement that the organization has terminated or is terminating (going out of business)

There's a search function that will let you see if groups have filed one
of these so-called 'e-postcards." Apparently the law requires one to be
filed at least every three years and this is the conclusion of the
third.

Good luck to all.

Ron Boerger
 

saxhound

Moderator
Staff member
CE/Moderator
#3
I'm not a tax accountant (although I did stay in a Holiday Inn), but I'm pretty sure you are supposed to file it every year. If you don't file for three consecutive years, they pull your non-profit status. I'm the treasurer for a small non-profit, and researched this pretty thoroughly last year.
 

jbtsax

Distinguished Member
Distinguished Member
#4
The facts can be found at this link:

http://www.irs.gov/charities/article/0,,id=169250,00.html

The Yahoo (AP) article contains some inaccurate and misleading information. Yes, organizations who earn under $25,000 per year who previously did not have to file a 990 or 990 EZ each year will be required to file the 990-N called an e-postcard beginning this year.

However, if they miss the deadline they will be sent a reminder and face no late penalty for not filing on time. It is only if they fail to email the 990-N for the next 3 years that their tax exempt status will be in jeopardy. It is amazing to me how a professional journalist writing for the Associated Press can screw something up this badly in an article. It took me all of 5 minutes to research the topic and get the correct information.
 
#5
When my corporation is nonprofit, it is completely unintentional.
Yeah, I used to work for a 501(c)3 hospital, a not-for-profit organization. We tried very hard to show some surplus each year, to provide a reserve for future needs. Non-profit better describes the occasional "oh sh**" by a company that is not a charity.
 
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