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I typically credit the person or service that directs me to something I think I should share. In this case, I credit my wife, Mary Ellen, for having directed me to a Yahoo news story that may be important to you or one of your clients. If you knew my wife's appreciation for the niceties of tax law, the irony would be amusing. However, this is an important Hot Tip. And it is at the last minute too! The story is at the following URL:

http://news.yahoo.com/s/ap/20100516/ap_on_bi_ge/us_charity_deadline

A quick search on my favorite tax research software (Google) showed that the story has legs. Small charitable organizations who do not file form 990-N by tomorrow, may automatically lose their charitable status.

http://www.irs.gov/charities/article/0,,id=169250,00.html

The IRS website tells you about the problem, and points out that you can file electronically with an e-postcard and a small number of items of information:

Small tax-exempt organizations whose annual gross receipts are normally $25,000 or less may be required to electronically submit Form 990-N, also known as the e-Postcard, unless they choose to file a complete Form 990 or Form 990-EZ.

If you do not file your e-Postcard on time, the IRS will send you a reminder notice but you will not be assessed a penalty for late filing the e-Postcard. However, an organization that fails to file required e-Postcards (or information returns – Forms 990 or 990-EZ) for three consecutive years will automatically lose its tax-exempt status. The revocation of the organization’s tax-exempt status will not take place until the filing due date of the third year.

What the IRS website doesn't say unless you dig deeper into the link they provide to the final regulations, issued in 2009, is that this applies for years following 2006, so that if you haven't started filing this form, this is your last chance!

Monday is it! So if you have contact with small charitable organizations might be covered by this, you should call them right away.

Please read the important information relating to tax advice at the bottom of this web page.

Best regards,
Bob Wolf, Moderator

“Any tax advice in the foregoing message was not intended or written to be used, and cannot be used by any person for the purpose of avoiding tax penalties that may be imposed with respect to the matters addressed. Some of that advice may have been written to support the promotion or marketing of the transactions or matters addressed within the meaning of IRS Circular 230, in which case, be advised that the advice was written to support the promotion or marketing of the transaction(s) or matter(s) addressed, and you should seek advice based on your particular circumstances from an independent tax advisor.”