Last Chance to File Exempt
Included in the Pension Protection Act of 2006, tax-exempt organizations that do not file the required information form for three consecutive years automatically lose their Federal tax-exempt status. Filing year 2010 (tax form year 2009) is the last of those three years.
The filing requirements for tax-exempt organizations are as follows for the 2009 tax year, those returns filed in 2010:
|
Form |
If gross receipts are: |
If assets are: |
|
990-N |
≤ $25,000 |
N/A |
|
990-EZ |
> $25,000 & < $500,000 |
< $1,250,000 |
|
990 |
≥ $500,000 |
≥ $1,250,000 |
A tax-exempt organization can choose to file the 990 form regardless of gross receipts or total assets. Form 990-PF is required to be filed for all Private Foundations.
What if an organization loses its tax-exempt status?
In order for an organization to regain its tax exemption, it must apply for IRS recognition of exemption by filing Form 1023 (for 501(c)(3) organizations) or Form 1024 (for organizations exempt under other Code Sections) and pay the appropriate application fee. If the IRS approves the application, tax-exempt status will be effective as of the date of the application, unless the organization demonstrates reasonable cause for failure to file. In that case, exemption will be effective as of the date of revocation. Be aware, any income from the date of the revocation to the new effective date may be taxable.
Questions?
Contact:
Brandon R. Miller, CPA
Principal & Director
HW Nonprofit Advisors
(216) 831-1200
millerb@hwco.com
