Congressional law says that any NPO not filing required 990 returns with the IRS for three consecutive years will automatically lose tax-exempt status. This is called automatic revocation. The first time the three-year rolling requirement came into play was for years ending December 31, 2009 with the filing deadline of May 15, 2010.
On June 8, 2011, the IRS published the first list of organizations subject to automatic revocation.
This is an issue especially for really small organizations because they have to file what is called an e-postcard return, Form 990-N. That requirement started three years ago so December 31, 2009 is also the three-year timeline for automatic revocation of really small organizations.
Important! This whole automatic revocation thing does not apply to churches. It also does not apply to church related organizations (you know who you are if you are in that category).
The list of organizations can be found on this page at the IRS website. The list is broken up into states with your choice of getting information in either PDF or Excel format.
A page of frequently asked questions is available from the IRS here.
It is not a good thing to be on the automatic exemption list. If your organization shows up, contact a CPA or tax attorney for advice on how to proceed.
See additional discussion here.
There will be lots of news articles about this. For one example, see this article from the New York Times.
The IRS is offering transitional relief for small revoked groups. It’s one of the best deals I’ve seen in my four decades of professional involvement with non-profit taxes. A nonprofit client that can honestly say there is still a need for the non-profit, and can muster the human and other resources needed to sustain it, should be encouraged not to pass up this opportunity to regain tax exempt status.
There are no shortcuts. A new exemption application will have to be completed, and an IRS User Fee will have to be paid. But for organizations with annual gross receipts normally less than $50,000, the User Fee will be reduced to only $100 and reinstatement will be retroactive. The offer is only good through December 31, 2012. Details are at http://www.irs.gov/pub/irs-drop/n-11-43.pdf.
A little more than a year into this revocation program, the total of IRS revocations has risen to more than 444,000.
The good news is that as of early July, 2012, 8,194 revoked non-profits had successfully applied to have their status reinstated.
There are only 5 months left of “Transitional Relief,” the special IRS reinstatement program for small non-profits. Small non-profits interested in reinstatement have no time to waste!
Good reminder!
Thanks for the comment.