Tick-Tock – Time Is Running Out For Delinquent 990s

Deadline for form 990

I have blogged about this before, but I thought a reminder was in order. The October 15 deadline for tax-exempt organizations to file a Form 990-N is fast approaching. October 15 is a key deadline for thousands of small nonprofit organizations at risk of losing their tax-exempt status because they have not filed the required forms in the last three years. Many small tax-exempts are unaware of this requirement because it is a new requirement imposed by the Pension Protection Act of 1996.  The first major deadline to file was May 17, 2010, but the IRS offered a relief program, extending the deadline to October 15, 2010.

The October 15 deadline is the last chance for many small charities to comply with the law under the one-time relief program the IRS announced in July. Remember, beginning in 2006, even tax-exempt organizations with no revenue must file a 990-N at the very least. Exceptions include the following:

  • Organizations included in a group return
  • Private foundations required to file Form 990-PF
  • 509(a)(3) supporting organizations required to file Form 990 or Form 990-EZ
  • Certain faith-based organizations

Two types of relief are available for small exempt organizations a filing extension for the smallest organizations required to file Form 990-N, and a Voluntary Compliance Program for small organizations eligible to file Form 990-EZ. To comply, small organizations required to file Form 990-N should go to the IRS website, complete the form, and electronically file it by Oct. 15, 2010.

Under the Voluntary Compliance Program, larger tax-exempt organizations eligible to file Form 990-EZ (but not eligible to file Form 990-N) must file their delinquent annual information returns by October 15 and pay a compliance fee which is between $100 and $500 depending upon the organization’s revenues.  Details about the VCP are on the IRS website, along with frequently asked questions.

Note that the relief program is not available to larger organizations that are required to file Form 990 or Form 990-PF.

The IRS will keep today’s list of at-risk organizations on its website until Oct. 15, 2010. Organizations that have not filed the required information returns by that date will have their tax-exempt status revoked, and the IRS will publish a list of these revoked organizations in early 2011.  Contributions from donors who contribute to at-risk organizations will qualify for the charitable contribution deduction until the final revocation list is published.

Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. licensed to practice in Washington and Arizona. Ellis advises nonprofit and socially responsible businesses on corporate, tax, and fundraising regulations nationwide. Ellis also advises donors with regard to major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form

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