- June 2010
- Congress Tries Again to Extend IRA Tax Incentive, Ease Pension Rules
- House Approves Quick Tax Breaks for Chile Donations
- Financial Overhaul Measure Being Considered by the Senate
- Senators Call On Boys & Girls Clubs to Justify Pay and Spending
- Muslim Groups Urge Obama to Ease Giving Restrictions
- Senator Questions Colleges’ Use of Tax-Exempt Bonds and Foundation Tax Proposal
- Proposed Donor Disclosure Requirements Concern Nonprofits
- US Government Awards Millions for AmeriCorps Expansion
- Legislation Introduced in House to Improve Federal Policy Toward Charities
- Supreme Court Upholds Law Prohibiting Aid to Terrorist Groups
- Boston to Seek Bigger Payments from Nonprofit Groups
- IL Supreme Court Rules Against Nonprofit Hospital in Property Tax Case
- CA Lawsuit Could Impact Health Care Fund Raisers
- Equity Firm Buys Mass. Catholic Hospital Chain
- OK Attorney General Opens Formal Investigation of Charity
- Corruption Alleged at NY Theatre Group
- NJ Aims to Limit State Pay for Nonprofit CEO’s
- Two MA Hospital’s Senior Executives Face Legal Scrutiny
- Nonprofit Suing State for Violating Freedom of Speech
- Strapped MA Towns Tax Catholic Properties
- GA Charity Challenges Tax Penalty for Fund-Raising
- IRS Notes Abuse of Charitable Deductions Tax Schemes
- IRS Continues Its Focus on Non Profit Governance Matters
- IRS Allows Small Charities a Reprieve from Tax-Filing Deadline
- IRS Concerned with Colleges’ Salaries and Income Reporting
- Postal Service Seeks to Reduce Delivery and Increase Rates in 2011
- All Pages
IRS Allows Small Charities a Reprieve from Tax-Filing Deadline
As many as 400,000 nonprofit organizations (about 25%) could have lost their tax exempt status on May 17th because of a provision buried in a federal bill aimed at pension reform.
This federal legislation -- the Pension Protection Act of 2006 -- required all nonprofits to file tax forms the following year. (Previously, only organizations with revenues of $25,000 or more had to file). It also directed the IRS to revoke the tax exempt status of nonprofits that failed to do so for three consecutive years… which happened on May 17th. Without receiving these forms, the IRS claimed it did not have sufficient facts about these organizations to allow it to appropriately oversee one of the most generous breaks the federal government offers.
Nonprofits that are still active but lost their tax-exempt status would have faced two problems. They would have had to reapply with the IRS for a new exemption and pay a fee. They would also have been liable for income taxes for the period in which they were not exempt.
The IRS has encouraged these non complying nonprofits to file even though the May 17th deadline has passed. It now plans to begin sending revocation notices in January 2011.