Is your charity or other nonprofit about to lose its tax-exemption? If it hasn’t been keeping up on filing its annual returns with the IRS, its tax-exemption is in jeopardy. Being “tax-exempt” basically means that a nonprofit doesn’t pay federal income taxes on income related to its core purpose.
The New York Times yesterday reported that as many as 400,000 nonprofits are headed toward losing their tax-exemption on May 15 this year. The reason? Failure to keep current with the IRS by filing a Form 990, Form 990-EZ or Form 990-N. The filing rules apply to organizations that wish to be tax-exempt, even those who receive less than $25,000 in annual income (they used to be exempt from filing).
Read the story (free registration at the NYT site may be required)