Until now, most small tax-exempt organizations, defined as those with gross receipts of $25,000 or less per year, have not been required to file an annual information return with the Internal Revenue Service (the “IRS”).
However, small tax-exempt organizations must now file an annual electronic information return – the Form 990-N, also known as the e-Postcard. This requirement covers all tax periods beginning after December 31, 2006. The e-Postcard must be filed no later than the 15th day of the 5th month following the end of the organization’s tax year. For example, an organization whose tax year ends December 31 must submit the e-Postcard by the following May 15.
The e-Postcard is located at the following website: epostcard.form990.org. The filing can only be done electronically.
The e-Postcard requires the following information:
- Employer identification number (EIN), also known as a Taxpayer Identification Number (TIN)
- Tax year
- Legal name and mailing address
- Any other names the organization uses
- Name and address of a principal officer
- Web site address if applicable
- Confirmation that the organization’s annual gross receipts are normally $25,000 or less
- If applicable, a statement that the organization has dissolved or is winding up its affairs
The IRS will increase the e-Postcard filing threshold from $25,000 in gross receipts to $50,000 in gross receipts, beginning with the 2010 tax year.
Exemptions to this new filing requirement are as follows:
- Organizations that are included in a group return
- Private foundations required to file Form 990-PF
- Section 509(a)(3) supporting organizations that must file a Form 990 or Form 990-EZ
- Churches, their integrated auxiliaries, conventions, and associations of churches
Please note that the IRS will revoke the tax-exempt status of any organization that does not meet its annual filing requirement for three consecutive years. Therefore, any tax exempt organization, no matter how small, will have its tax-exempt status revoked if it does not file an annual information return for three years in a row.
This memorandum is not intended to provide legal or tax advice. For more information or advice regarding the new filing requirement, please contact Shirin Philipp or Sharon Lincoln of Foley Hoag’s Nonprofit Practice Group or contact your lawyer at Foley Hoag.
To ensure compliance with requirements imposed by Treasury Department Regulations, we inform you that any United States tax advice contained in this document is not intended or written to be used, and cannot be used, for the purpose of: (i) avoiding penalties under the Code that may be imposed on the taxpayer, or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.