Good news for nonprofits that didn’t know they needed to be filing annual returns with the IRS (990/990-EZ/990-N) and lost their tax exempt status.
The IRS has a streamlined program to give retroactive reinstatement of tax-exempt status if the organization applies within 15 months after the later of the date of the revocation letter, or the date on which the IRS posted the organization’s name on a revocation list.
Nonprofits must reapply for tax exempt status within 15 months of when tax exempt status was revoked, but at least the IRS will reinstate back to the date it was revoked. They used to only reinstate nonprofits back to the postmark of the application leaving a gap when the poor nonprofit had to file and pay taxes!
This happened to several homeschool groups. They either didn’t know about the required IRS annual reports (990/990-EZ/990-N), or missed a deadline and had their tax exempt status revoked. A few of them had a gap of several months (or years) of when they were not tax exempt and had to file and pay corporate income taxes.
For more details on the new IRS program: https://www.accountingtoday.com/news/IRS-Offers-Ways-Groups-Regain-Tax-Exempt-Status-69160-1.html?taxpro
If you like reading IRS documents: IRS Revenue Procedure 2014-11
What does this mean for your homeschool group?
1. Start filing the Form 990-N. EVERY nonprofit is required to be filing this annual information return with the IRS. Read this blog post. Failure to file for 3 consecutive years means your tax exempt status is automatically revoked!
2. If you received a letter from the IRS for not filing the Form 990/990-EZ/990-N, contact me about getting your tax exempt status reinstated. Or even without a letter from the IRS, if your organization thinks it has never filed a 990, contact me
Carol Topp, CPA
Helping Homeschool Leaders