COLUMBUS, Ohio (CGE) – From Aberdeen in Brown County to Zoarville in Warren County, and an alphabet soup of cities and counties in between, 10,645 Ohio non-profit organizations were among 275,000 others nationwide that lost their tax-exempt status because they failed to file legally required annual reports for three consecutive years, the Internal Revenue Service said Wednesday.
While the IRS believes the vast majority of these organizations are defunct, it also announced special steps to help any existing organizations to apply for reinstatement of their tax-exempt status.
In a media release about the report, the IRS said Congress passed the Pension Protection Act in 2006, requiring most tax-exempt organizations to file an annual information return or notice. For small organizations, the law imposed a filing requirement for the first time in 2007. In addition, the law automatically revokes the tax-exempt status of any organization that does not file required returns or notices for three consecutive years.
“During the past several years, the IRS has gone the extra mile to help make tax-exempt groups aware of their legal filing requirement and allow them additional time to file,” IRS Commissioner Doug Shulman said. “Still, we realize there may be some legitimate organizations, especially very small ones, that were unaware of their new filing requirement. We are taking additional steps for these groups to maintain their tax-exempt status without jeopardizing their operations or harming their donors.”
Adopt A Junior Golfer Inc., The Albany Area Chamber of Commerce, 28 American Federation of State County Municipal Employees, 46 American Legions, 56 American Legion Auxiliaries, Building Virtuous Women Of God, Columbus Youth Corps, 37 Fraternal Order Of Police, 36 International Association of Lions, 22 Military Order Of The Cootie Of US and many, many, many others based in Ohio made the the IRS list.
The IRS has for many years made an extensive effort to inform organizations of the changes in the law through multiple outreach and education avenues, including mailing more than 1 million notices to organizations that had not filed. In addition, last year the IRS published a list of at-risk groups and gave smaller organizations an additional five months to file required notices and come into compliance. About 50,000 organizations filed during this extension period. Overall, the IRS believes the vast majority of small tax-exempt organizations are now in compliance with the 2006 law.
To regain their tax status, Ohio groups – with annual gross receipts of $50,000 or less for 2010 – can pay a reduced application fee of $100 rather than the typical $400 or $850 fee. If an organization appears on the list of organizations whose tax-exempt status has been automatically revoked it is because IRS records indicate the organization had a filing requirement and did not file the required returns or notices for 2007, 2008 and 2009.
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