Approximately 4,400 small nonprofits in Minnesota risk losing their 501(c)(3) tax-exempt status next week. They will be ineligible to receive tax-deductible contributions unless they go online and file IRS form 990-N.
A 2006 law requires that organizations with financial activity under $25,000 that operate on the calendar year file by May 17, 2010, or have their tax exemption revoked. Previously, such organizations were not required to submit an annual IRS return.
Organizations can see if they need to comply by visiting the Urban Institute’s searchable database of organizations that are required to file but did not as of May 1.
Compliance is simple: the chief person from the organization can file online through an approved IRS 990-N e-file provider at http://epostcard.form990.org/. If the organization has been terminated, the IRS should also be notified through this form.
Organizations that fail to meet the deadline will have their exemptions revoked. Reapplication costs up to $750, plus time, aggravation and attorney’s fees.
People involved in small nonprofits can find more information and double-check a list on the Minnesota Council of Nonprofits website at mncn.org. See, also, the recent Star Tribune story that describes organizations that may be affected.
[...] This post was mentioned on Twitter by OnlyFoundations. OnlyFoundations said: MN Council Blog: Nonprofits: Don’t Lose Your Tax-Exempt Status: Approximately 4,400 small nonprofits in Minnesota … http://bit.ly/bqkGwC [...]