Tuesday, August 9, 2011

So you think you've got it hard now? IRS eliminates 14% of nonprofits

Poof GoneWith a click of the computer, the IRS has trimmed 275,000 nonprofits—or about 14% of the national total—from its roster of tax-exempt organizations, claiming that the organizations had not filed legally required documents for three consecutive years.

Three years??! Now that's a Big Oopsie! They shoulda oughta known.

While some of the de-listed groups are doubtless defunct, most are small charities providing vital services to their local communities, including food banks, clothing distribution centers, art centers, abused women counseling, resume' preparation assistance, abandoned animal rescue and fostering, and help to injured firemen, policemen or veterans. Especially at risk are very small nonprofits with annual revenues under $25,000.

Wait a minute! These are the "below the radar" groups who are repairing the shredded safety net in our communities every day. They make life livable for thousands of our neighbors!

Because of their small size and limited staff, (who are busy doing the work we've asked them to do!) many of these groups may not be aware that they have a three-year filing requirement (enacted by Congress in 2006 to better track groups claiming tax-exempt status). Congress gave micro groups three years to comply; larger groups must file annually.

Hold on! 2006? That was a whole different landscape. We need every possible do-gooder on the scene now to help those affected by this intractable recession.

Tax Exempt StatusSo as to not appear cold-hearted about the public whacking, the IRS is offering to assist groups that are still active regain their tax exempt status.

Groups that find themselves de-listed can apply for retroactive tax-exempt status. Applying can cost as much as $850, but the fee can be reduced for small groups with legitimate reasons why they failed to file in a timely fashion. (Too busy serving the community during the worst recession since 1929? That works for me!)

Larger groups seeking retroactive reinstatement may not see as much generosity of spirit from the IRS.

IRSThese words were hard to type and may never leave my fingertips again: Thank you, IRS. These groups are vital to the wellbeing of millions of Americans. Any assistance you can provide is appreciated.

And here's a final word to my generous readers: If you donate to one of these groups, your gifts made after de-listing will not be tax exempt. At such time as the group is reinstated, then your generous gifts once again became tax exempt.

No comments: