Sunday, May 16, 2010

Non-Profits may lose their tax exempt status on Monday

A change in law put in place through a 2006 federal pension bill requires all non-profits, even small ones, to file IRS form 990s or a simplified version of the form. Nonprofits with less than $25,000 in annual revenue formerly didn't have to file with the feds like larger organizations. But that changed with the passage of the 2006 law. Small volunteer type organizations had three years to comply, but many remain unaware of the impending deadline. The grace period ends on Monday.

The deadline applies to groups that report $25,000 or less in income but excludes churches. Organizations that lose their tax exempt status may not find out until Jan. 1, 2011, when they're notified they have to pay taxes on donations they thought were exempt. And it could be months before their nonprofit status is restored.

Please forward this post to any community groups or small volunteer organizations that currently have 501c3 Tax exempt status...

Organizations can still E-File their 990s form and beat the deadline. CLICK HERE for the E-Filing form.

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