[Dailydrool] ALERT:Bassets, 501 c3 status and the IRS (long)

[Kathleen Jones]

Sorry this is so long.  It's making the rounds of other dog lists.  Here's 
hoping the Basset scene has it already covered, but just in case, here 'tis. 
Please do not ask me questions  on it, I am only the messenger.  Maestro & I 
know not about such things.

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This many be  of some interest to dog clubs and rescues.
ALERT!!!
Charities who have not  filed ("postcard" or other 990 Form) with the IRS 
for three years will lose  their charitable 501(c)(3) status on MONDAY if 
they do not FILE, or get an  extension, for 2009, by MONDAY.

BACKGROUND:
Many people are confused about  the IRS requirements for charities to file 
returns.  The thinking is that  since a charity is "tax exempt" and
(usually) would owe no taxes, why would one  file a return?  However, the 
law has always required that an "Information  Return" (one of several Form 
990s) be  filed by charities.

As I'm sure you know, small  charitable organizations (those who gross less 
than $25,000 in a year)  historically did not need to file any form with the 
IRS.  In 2006, that  changed when the Pension Protection Act was passed. 
Beginning for the  year 2006, all charities are required to file the correct 
Form 990 return for  Charitable Organizations.   For the smallest charities, 
under  $25,000 a year, they need only file a "postcard" form, called 990N. 
(Only  the IRS would come up with a form number "N" instead of a "P" to 
indicate a  "postcard" filing.)

 Those taking in more than $25,000 but less than  $100,000 in a year can 
still file a Form 990EZ.   (More than $100,000  requires a From 990, but 
most local rescue groups, of course, won't meet that  level.)  Historically, 
charities were  always at risk for penalties for not filing a
form.  The law said that  penalties "may" be imposed and that the 
organization "may" lose their charitable  exemption status.  However, that 
was not really much of a risk and was  rarely enforced.  The smallest 
charities, of course, were not at risk at  all, because until 2006, they 
were not required to file a form in the first  place.  Again, the new law 
has changed this.  It now requires the  IRS to revoke the 501(c)(3) status 
if a group has not filed for three  consecutive years.

REVOCATION FOR FAILURE TO  FILE:
The IRS recently sent out  statements to large companies which monitor 
charities, such as Guidestar and  Charity Navigator, which warned:   "The 
Pension Protection Act of 2006  requires the IRS to revoke the federal tax 
exemption of any organization that  has failed to file three consecutive 
annual returns (Form 990-N, 990-EZ,  990, or 990-PF). Nonprofits that wish 
to have their exemptions reinstated will  be required to re-apply to the IRS 
for tax-exempt status, a process that can  take several months.  The IRS 
will begin revoking exemptions on  May 17, 2010, but will wait until 2011 to 
send revocation notices."  (Guidestar estimates that up to 400,000 
nonprofits, mostly smaller  ones, who were unaware of, or ignored, the new 
requirement to file a From 990N  "postcard filing," are in danger of losing 
their exemptions. )

All charities need to  file the correct 990 Form.  But those who have not 
filed any form for the  last three years (which would mean they did not file 
for the years 2006, 2007,  0r 2008) MUST file by Monday to avoid losing 
their 501(c)(3) tax-exempt  charitable organization status.

These forms can be filed online  via the IRS website, at: 
_http://www.irs.http://www.irshttp://wwwhttp://www.http://_
(http://www.irs.gov/charities/article/0,,id=217087,00.html)

One can get an automatic  extension by filing Form 8868 - go to: 
_http://www.irs.http://www.irshttp://wwwhttp://www.http://_
(http://www.irs.gov/charities/article/0,,id=210780,00.html)
(f the above links do not work,  just to to _www.irs.gov_
(http://www.irs.gov/)  and click on the "Charities &  Non-Profits" tab along 
the top, and the next screen will notify you of the  filing requirement and 
allow you to click through to the  forms.)

As Charitable Organizations are  also non-profit corporations, their 
deadline for filing is the same as other  corporations, which is May 15.  As 
that is a Saturday,  charities have until the next business day, MONDAY, MAY 
17, to file either the  correct Form 990, or get an extension for filing by 
filing Form 8868.

In real life, volunteers in  small charities change a lot and records are 
lost.  If you are unsure if  your group has filed in the last three years,
you can check online by entering  your group's name at:
_http://www.irs.http://www.irs.ht_ http://www.irs.gov/app/ePostcard/  (If 
that link doesn't work, go to _www.irs.gov_ (http://www.irs.gov/)  and click 
on "Charities & Non-profits" third tab in on the top, then click on "Annual 
Electronic Filing Requirement for Small Exempt Organizations," which is 
about  the fifth choice down on the left, and scroll down to the "Search" 
box on that  screen.)

But even if the record shows a filing in the last three years - don't  take 
a chance, and file for 2009, or get an extension, by Monday.