The IRS is encouraging small not-for-profits organizations to file any missing tax returns for the years 2007, 2008 and 2009. The underlying issue, apparently, is a change in how smaller charities report their income to the IRS. For 2006 and earlier years, non-profits with annual receipts of $25,000 or less were exempt from filing returns with the agency. Starting with 2007, charities are required to file regardless of the size of their income. Smaller charities may be eligible to file the so-called electronic postcard (Form 990-N) or the shorter Form 990-EZ. The IRS is providing a special grace period: as long as all returns are filed by October 15, 2010, non-profit organizations will be able to keep their tax-exempt status.
Also, in an unusual move, the IRS released the names of all charities at-risk of losing their exempt status.
Additional Resources:
- IRS Offers One-Time Special Filing Relief Program for Small Charities; Oct. 15 Due Date to Preserve Tax-Exempt Status
- List of Organizations At Risk of Automatic Revocation of Tax-Exempt Status
- IRS Resources for Charities and Nonprofits
- Things You Need to Know About Form 990 (About Nonprofits)
- What is Form 990-N? (About Nonprofits)
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I have more than 36 years helping small non-profits deal with IRS matters. I originally published my popular ebook, Prepare Your Own 501(c)(3) Application, in 2003.
I wish they would pick more on the big guys than the small guys. I think there is probably more abuse among the big non for profits, but once again, the small guys take the hit.