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Tax-exempts reminded to file or risk losing exemption; warned not to include Social Security Number

IR 2015-78


In an Information Release, IRS has reminded tax-exempt organizations to file From 990 (Return of Organization Exempt From Income Tax) by May 15, 2015, or risk having their federal tax-exempt status revoked. IRS also cautioned these groups not to include Social Security numbers (SSNs) or other unneeded personal information on their Form 990, and to consider taking advantage of electronic filing.

Three year filing rule. Under the 2006 Pension Protection Act (PPA), a non-church exempt organization’s failure to file Form 990 for three consecutive years will result in the revocation of the organization’s exempt organization status under Code Sec. 501(a) on and after the date IRS has set for filing the third annual return or notice. (Code Sec. 6033(j)(1)) The revocation will be effective from the date that IRS determines was the last day the organization could have timely filed the third required information return or notice.

Form 990-series information returns are due on the 15th day of the fifth month after an organization’s year ends. For organizations using the calendar year as their tax year, May 15 is the deadline for them to file for 2014.

Small tax-exempt organizations—those with annual receipts of $50,000 or less—can file an electronic notice Form 990-N (e-Postcard). This asks for a few basic pieces of information. Tax-exempts with annual receipts above $50,000 must file a Form 990 or 990-EZ, depending on their annual receipts. Private foundations file Form 990-PF.

Reminder. With the May 15 deadline looming, IRS warns tax-exempts that they may risk losing their exempt status if they fail to timely file. IRS also warns that it generally doesn’t ask organizations for SSNs and in the Form Instructions cautions filers not to provide them on the form. By law, both IRS and most tax-exempt organizations are required to publicly disclose most parts of form filings, including schedules and attachments.

Public release of SSNs and other personally identifiable information about donors, clients or benefactors could give rise to identity theft. IRS urges tax-exempt organizations to file forms electronically in order to reduce the risk of inadvertently including SSNs or other unneeded personal information.

Organizations that need additional time to file a Form 990, 990-EZ or 990-PF may obtain an extension. Exempts can generally request an extension by filing Form 8868 (Application for Extension of Time To File an Exempt Organization Return) by the original due date. Absent a request for extension, there is no grace period from filing by the original due date. No extension is available for filing the Form 990-N (e-Postcard).

IRS notes that it publishes the names of organizations identified as having automatically lost their tax-exempt status for failing to file annual reports for three consecutive years. Organizations that have had their exemptions automatically revoked and wish to have that status reinstated must file an application for exemption and pay the appropriate user fee.

IRS also offers an online search tool, Exempt Organizations Select Check, to help users more easily find key information about the federal tax status and filings of certain tax-exempt organizations, including whether organizations have had their federal tax exemptions automatically revoked.

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Meet Paul Raymond

Meet Paul Raymond

Mr. Raymond is a sought after speaker in tax controversy law by many attorney, accountant, and business groups and at the request of the Internal Revenue Service, has presented programs at the IRS Nationwide Tax Forum, attended by tax professionals throughout the United States.

Additionally, he continues to be an active member in the Section of Taxation, American Bar Association, where he was the Past Chair of the Employment Taxes Committee.

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