In the United States there are more 200,000 small nonprofits. It does sound like a large number, doesn’t it? Does the IRS think it is too many? Well, these organizations could be close to losing their tax-exempt status if they haven’t filed a new form with the Internal Revenue Service.
Why haven’t they filed the form? Most likely they were not aware of a deadline that only applies to groups that report $25,000 or less in income, excluding churches. And those organizations may not find out until Jan. 1, 2011, when they’re notified they have to pay taxes on donations they thought were exempt. Even worse, if they missed filing the form, it could be months before their nonprofit status is restored.
Congress required the form, called a 990-N, when it amended the tax code three years ago and groups with a fiscal year ending Dec. 31 had until Monday, May 17 to meet the deadline. The form is due every year by the 15th day of the 5th month after the close of your tax year. For example, if your tax year ended on December 31, the e-Postcard is due May 15 of the following year. (May 15 was a Saturday and so the extension until May 17.)
If they do not file 990 N on time, the IRS will send a reminder notice but you will not be assessed a penalty for late filing. However, there is some good news, an organization that fails to file required e-Postcards (or information returns – Forms 990 or 990-EZ) will not lose its tax-exempt status unless they fail to file for three consecutive years. The revocation of the organization’s tax-exempt status will not take place until the filing due date of the third year.
Learn more at http://www.irs.gov/charities/article/0,,id=169250,00.html.
