Today, the IRS released the following information – reminding organizations to properly file Form 990. According to the Pension Protection Act of 2006 non-profit organizations failing to file the required form for three consecutive years will automatically lose their federal tax-exempt status.

Mark your calendars and file the return, with extensions, if necessary.

Have questions? Give me a call.

On an annual basis, tax-exempt organizations (excluding certain religious, gov’t and political organizations) are required to file an annual return with the IRS. Which form the organization files, depends on the organizational type (public vs private charity) and the amount of gross receipts and assets of the entity.

Public Charities (excluding certain religious, gov’t and political organizations) are requied to file a Form 990, and if your have:

1. Gross receipts greater than $1,000,000 and assets greater than $2,500,000 your organization should complete Form 990.

2. Gross receipts greater than $25,000 and less than $1,000,000 and assets less than $2,500,000 should complete Form 990EZ.

3. Gross receipts less than $25,000 should complete Form 990-N.

Private foundations file Form 990-PF.  Forms 990 and 990-PF are due within 41/2 months after your organization’s year-end (May 15 if your year-end is December 31). Extensions may be filed using Form 8868.

If you fail to file the return on time, the penalties for the 990 are $20/day to a maximum of $10,000 or 5% of gross receipts. The penalities for a 990-PF are $20/day to a maximum of $10,000 (small org) or $50,000 (large org) or 5% of gross receipts.

So…be ready to file or extend as the due date approaches.