Nonprofit 990

Nonprofit 990

Nonprofit 990

If the tax-exempt status of a nonprofit organization has just disappeared, it's likely to be in good company. Thanks to an administrative change in IRS regulations governing tax-exempt organizations with under $25,000 in annual revenue, many local, volunteer-powered nonprofit entities could be subject to an automatic change in tax status.

Starting in 2007, the IRS has required annual online reporting from exempt organizations under $25,000. If a small tax-exempt charity didn't file by May 17, 2010, it's in jeopardy of losing its valuable designation as a federally registered tax-exempt organization.

Forgetting to File the 990: A Small Change with Potentially Big Consequences

The IRS' intent is not to shut down volunteer activity or charitable organizations. It's simply seeking to remove dead wood from its roster, and weed out organizations that exist in name only, or are defunct.