- March 2011
- New Tax Deal Lowers Estate Tax and Extends IRA Charity Break
- Democrats Turn Back Republican Health Care Repeal Amendment
- House & Senate Committees Hold Hearings on Tax Reform
- Obama's Budget Plan Calls for Cut in Charitable Deductions
- Republicans Propose Big Federal Budget cuts That Impact Non Profits
- Many Nonprofits Face Lawsuits over Madoff's Fraud
- Senator's Investigation into Ministries Leads to Tax Review
- Officials Say Oregon Charity Shifted Millions to Iran
- Budget-Strapped Cities Charge Nonprofits New Fees
- Nonprofits in CA Face More Fiscal Strain
- Virginia A.G. Says No State Funds Can Legally Go To Charities
- NV Court Rules Donor-Advised Funds Can Ignore Donor Advice
- CT University Fights to Preserve Donor List Confidentiality
- OR Sues Veterans Charities Accused of Misusing Funds
- The IRS Steps Up Scrutiny of Nonprofits
- IRS Investigates CA Hospital's Charity's Nonprofit Status
- Automatic Revocations Will Reshape Nonprofits Beyond 2011
- Postal Rates to Increase in April 2011
- All Pages
Automatic Revocations Will Reshape Nonprofits Beyond 2011
The Internal Revenue Service (IRS) is publishing a list of tax-exempt organizations that have had their status automatically revoked for failure to file annual information tax returns for three consecutive years. By last estimates, more than 300,000 organizations were on track to lose their exemptions.
The new rule that almost every tax-exempt organization must annually file an information return with the IRS to maintain status is raising the expectation that basic transparency is required to be a tax-exempt organization.
However, it’s not maintaining tax-exempt status that will be the issue for the philanthropic sector. It will be proving that an organization’s status remains current that will fundamentally change non-profit practice.
Today, development officers photo-copy or create PDF images of the IRS Letter of Determination. They attach the letters to grant applications as a confirmation of tax-exempt status. Now that current tax-exempt status is tied to ongoing reporting obligations, the IRS Letter of Determination will not satisfy basic due diligence requirements for grant makers.
The question remains whether all of the non profit tax-exempt organizations that have not filed are actually out of business.