Gonsiorek: Is your nonprofit's tax-exempt status secure?
In years past, nonprofit organizations have been largely ignored by the Internal Revenue Service. With the advent of the Pension and Protection Act of 2006 (PPA ‘06), the IRS has taken a more involved role with respect to oversight of nonprofit organizations. New filing requirements have been established and old rules are now more strictly enforced. This has culminated in the revocation of the tax-exempt status of more than 13,000 organizations in Illinois alone.
For many small nonprofit organizations, this has been a rather confusing ordeal. Prior to PPA ’06 they were not subject to IRS reporting requirements, but new regulations require almost all nonprofit organizations to file a return annually. The IRS has attempted to contact organizations at risk of losing their tax-exempt status. The problem is that, in the world of volunteer-based organizations, board members come and go. Consequently, the “last known address” on file with the IRS may be that of an individual board member who is no longer affiliated with the group and notices are sent to uninterested parties who disregard the warnings.
How do you know if your tax-exempt status has been revoked? If you are filing annually your form 990, 990-EZ, or 990-N, you probably have no worries. However, if you have not filed one of these forms for three years, your organization may be subject to the automatic revocation process. In that case, the organization probably will be found on the IRS exempt organization revocation list. You can view the list at http://apps.irs.gov/app/eos/. Organizations are listed by name, address, and federal identification number.
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