Annual IRS Reporting

Prior to the Pension Protection Act of 2006, tax-exempt organizations with annual gross receipts under $25,000 did not have any annual reporting requirement at the federal level.

Beginning in 2007, all tax-exempt organizations have been required to annually report to IRS, in electronic form, certain information about the organization which will become publicly available. The information required on the Form 990-N, which is usable by nonprofits with less than $50,000 in gross receipts, includes: the legal name of the organization; any name under which the organization operates or does business; the organization’s mailing address and Internet web site address (if any); the organization’s taxpayer identification number; the name and address of a principal officer; and whether or not the organization has disbanded.

Unfortunately, if you have never filed this annual report, or haven’t filed one during the past three years, IRS may revoke your non-profit status. At least one of MAFA’s member guilds has received IRS notice of this revocation. Fortunately, it is possible to request reinstatement of one’s exempt status.

So what to do?

Stay compliant!

If your guild is less than three years old, or has filed the IRS e-postcard Form 990-N in the past three years, just make sure to do it again for this fiscal year. The online Form 990-N can be used by any guild with gross receipts of under $50,000, and consists of eight simple questions which your Treasurer should be able to easily answer. It is due four months and 15 days after your fiscal year ends.

To file Form 990-N the first time, you will probably need to call IRS at 1-877-829-5500 and ask that your guild be set up to allow for the filing of the annual e-Postcard. You will need your guild’s EIN.

Request reinstatement of your tax-exempt status:

If you haven’t been filing this report, you may need to request reinstatement of your tax-exempt status. The law is quite clear on this point.

Even if you did not have to apply to get tax-exempt status in the first place, if you have lost it by not filing the annual information report, you will need to formally apply to IRS to get it back. This will probably require filing Form 1023-EZ and paying the application fee, currently $275.

We suggest:

  • Read up on the IRS process for reinstatement;
  • Read through the eligibility worksheet on page 13 of the Form 1023-EZ instructions to make sure you qualify to use the Form 1023-EZ;
  • Gather your documents: articles of incorporation or association, original and current bylaws.
  • Call IRS Nonprofit Customer Service at 1-877-827-5500 to determine your current status and to let IRS help you decide how to proceed.

Resources

IRS Publication 577: Tax-Exempt Status for Your Organization
IRS Customer Service for Nonprofits: 1-877-229-5500
IRS website for Charities and Nonprofits

This information is being provided by MAFA to make our member guilds aware of information other guild members have learned in their research. We are neither tax accountants nor tax attorneys and the information on this website is not intended to serve as legal or tax advice.