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Not For Profit/Exempt Organizations Blog

Tag Archives: Form 990

IRS Introduces New Procedures for Reinstatement of Tax-Exempt Status

Posted in IRS Filings

Tax-exempt organizations that have had their tax-exempt status automatically revoked because of failure to file required annual returns for three consecutive years can follow new procedures for seeking reinstatement of their tax exemptions.  The IRS released these procedures in Revenue Procedure 2014-11 on January 2, 2014.  The Revenue Procedure, which is the first IRS guidance… Continue Reading

IRS Draft of 2013 Form 990 and Instructions

Posted in IRS Filings

Earlier this year the IRS issued drafts of the 2013 Form 990, Return of Organization Exempt From Income Tax, and 2013 Form 990 Instructions.   Although there were no major changes to the Form 990, there were several changes and clarifications in the draft instructions, including: Short Period Returns.  The draft instructions clarify that a short… Continue Reading

IRS Sends Questionnaire to More Than 1,300 Self-Declared Section 501(c)(4), (5) or (6) Organizations

Posted in IRS Filings, Political Campaign Activity

IRS Exempt Organizations group has sent out more than 1,300 questionnaires to self-declared Section 501(c)(4) social welfare organizations; 501(c)(5) labor, agricultural or horticultural organizations; or 501(c)(6) business leagues.  The questionnaires are part of IRS efforts to increase voluntary compliance, learn more about self-declared exempt organizations, and determine whether self-declared exempt organizations are complying with applicable tax-exempt… Continue Reading

A Full Plate for the IRS: IRS Releases 2012 Exempt Organizations 2012 Annual Report and 2013 Workplan

Posted in IRS Filings

At the end of January, 2013, the IRS Exempt Organizations Group (“EO”) released its annual report, highlighting EO’s 2012 accomplishments and outlining its priorities for 2013.  This year’s report was significantly more detailed and informative than last year’s report and workplan.  Some accomplishments and priorities of interest are described below, with something for nearly everyone… Continue Reading

In Annual Procedure Update (Usually a Yawner), IRS Imposes 27-Month Deadline For Filing Exemption Applications For All Types of Exempt Organizations Seeking Retroactive Recognition of Exemption And Denies Retroactive Recognition of Exemption if Forms 990 Not Filed

Posted in Formation, IRS Filings

The IRS continues to implement the “three years and you’re out” rule for Form 990 non-filers added by the Pension Protection Act of 2006 (the “PPA”).  That legislation amended Section 6033 of the Internal Revenue Code to provide that exempt organizations required to file a Form 990-series return (i.e., a Form 990, Form 990-EZ or… Continue Reading

House Ways and Means Oversight Subcommittee Holds Second in a Series of Hearings on Issues Facing Tax-Exempt Organizations

Posted in Formation, Governance, IRS Filings

On July 25, 2012, the Oversight Subcommittee of the House Committee on Ways and Means, led by Congressman Charles W. Boustany Jr., MD (R-LA), heard testimony from the IRS and experts in the tax exempt community on the growing complexity of non-profit organizational structures, tax issues concerning unrelated business income and the redesigned Form 990…. Continue Reading

Treasury Releases its Priority Plan and the Form 990 Implementation Regulations

Posted in IRS Filings

Treasury just released the 2011–2012 Priority Guidance Plan. The Plan lists 317 projects that are priorities for Treasury resources through June 2012. Included in these projects are 13 projects directly related to Exempt Organizations. Many of the other projects such as the 66 employee benefits, executive compensation and employment taxes may affect Exempt Organizations.

IRS Announces how Exempt Organizations can Claim New Health Care Tax Credit

Posted in IRS Filings

The IRS today has released a draft version of the form that small businesses and exempt organizations will use to calculate the small business health care tax credit when they file income tax returns next year. The IRS also announced how eligible exempt organizations — which do not generally file income tax returns — will claim the credit during the 2011 filing season.

IRS Offers Relief for Small Organizations that Failed to File Returns for Three Consecutive Years

Posted in IRS Filings

Small not-for-profit organizations at risk of losing their tax exemption because of their failure to file the Form 990-N or Form 990-EZ for the 2007, 2008, and 2009 taxable years can preserve their status by filing these returns by October 15, 2010. The IRS announced yesterday a one-time relief program for these organizations that will give them a “pass” until October 15, 2010.
Two types of relief are available for small exempt organizations — a filing extension for the smallest organizations required to file Form 990-N and a voluntary compliance program (“VCP”) for small organizations eligible to file Form 990-EZ.

Getting Back to Basics: What Public Charities Should Know About Tax Exemption

Posted in Formation

It is essential that all public charities understand the basic rules surrounding their exemption. Indeed, achieving tax-exempt status is only half the battle – once an organization has established that it is tax-exempt, it must set up the proper checks to ensure that it meets ongoing compliance obligations. Plainly, certain activities can jeopardize an organization’s tax-exempt status or subject it to penalties. Because the IRS revised its Compliance Guide for Public Charities and we are in such a highly regulatory environment, we thought it would be helpful to discuss some of the basic rules surrounding tax exemption.

IRS Reminds Exempt Organizations to File Form 990 to Preserve Exempt Status

Posted in IRS Filings

Earlier this year, the IRS reminded all exempt organizations that, regardless of their size, they must file the Form 990 on time in order to preserve their tax-exempt status. Starting this year, organizations that fail to file these information returns for three consecutive years will automatically lose their exempt organization status.

Good Governance: The Bedrock of a Successful Not-for-Profit Organization

Posted in Governance

The goal of the revision of the IRS Form 990 is to increase transparency, encourage compliance, and emphasize the importance of ethics within a not-for-profit organization. Given that so much emphasis has now been placed on “good” governance, it is increasingly important for not-for-profit boards to draft, adopt, and implement relevant governance policies – meant to be “living” documents reflecting the organization itself, and changing as an organization grows and develops.

Form 990 Makeover, Version 2.0

Posted in IRS Filings

Even hard-core tax mavens don’t usually get excited when the IRS releases instructions for tax forms. An exception this year is the release of instructions for the 2009 Form 990, the form to be filed by tax-exempt organizations (other than private foundations) for calendar year 2009 and tax years starting in 2009.

With the New Form 990, Directors and Trustees Must Complete a Complicated Disclosure Form

Posted in Governance, IRS Filings

The IRS completely redesigned Form 990, the Return of Organization Exempt from Income Tax, to be filed for calendar year 2008 and subsequent periods. This form is filed by most tax-exempt organizations and is open to public inspection. One stated purpose of the makeover was to increase transparency and disclosure of exempt organization operations, thereby improving governance and highlighting conflicts of interest and insider dealings. One major change in the form is that it requires extensive reporting concerning the organization’s governance and management policies, the independence of its board, and board members’ and key employees’ family and business relationships with each other and with the reporting organization.

IRS Issues Audit Checklist for Exempt Organization Governance

Posted in Governance

Over the past few years, the IRS has become increasingly interested in monitoring the governance practices of tax-exempt organizations, particularly public charities. This interest has been shown through public statements of IRS officials, the addition of questions about board makeup and policies to the Form 990, an explanation of why the IRS considers governance important, and the development of training materials on governance for IRS personnel. Not all members of the exempt organizations community agree that the IRS should focus on governance. However, the IRS rationale is that a well-governed organization is a tax-compliant organization.
The IRS has now developed and released a governance issues checklist (the Governance Check Sheet) to be completed in each audit of an exempt organization. The checklist provides a very specific roadmap for exempt organizations to compare their practices and policies with what the IRS wants to see and to make adjustments where necessary.