Your RATES Secretes a directory of Shut down Charity Organizations

In 2006, Congress passed into law, the Pension Protection Act (PPA) that required most tax-exempt charities to offer an annual notice to the IRS providing various required information. In line with the law, small tax-exempt organizations that received annual donations of $50,000.00 and less would start complying with the notice provision’s rules in 2007. Any organization that did not file the mandatory information notice with the IRS for 3 consecutive years will be automatically revoked from its tax-exempt benefits. Following this law, in June 2011, the IRS released the very first set of organizations that were automatically revoked following failure to submit the mandatory notice for 3 consecutive years. There have been 275,000 organizations that were revoked from their tax-exempt statuses in this release.

Charity Organization

List of Revoked Organizations

The set of organizations that has been released by the IRS in June 2011 indicates the names of the charities, the Employer Identification Numbers (EIN) of the organizations, and the addresses of the organizations as held by the IRS in its database. It is the responsibility of donors to ensure that the organizations that they’re donating to are not marked as “revoked” in the IRS’s books. This set of revoked charities is available at the IRS website and may be sorted by name or state for easier reference. The IRS in addition has indicated that they may be updating the list on a monthly basis as more organizations get out of compliance and are put into the list.

Efforts by the IRS to Ensure Compliance

Considering that the passing of the Pension Protection Act 慈善機構 , the IRS has embarked on an awareness campaign to make qualifying charities aware of the newest requirements and to ensure they conform to the rule. There were various educational forums to make charities conscious of the newest rules. The IRS in addition has sent over 1 million letters to organizations that had not even complied to have them comply before they’re forced to be revoked. Furthermore, the IRS in addition has extended enough time for automatic revocation considering that the 3 year non-compliance time period for big charities must have ended in 2009. The time frame for small tax exempt charities that were to begin reporting in 2007 must have lapsed in 2010.

Relief for Small Charities

The IRS is conscious that some small charities could have been ignorant of the notice filing requirement and are therefore, providing a lenient method for these organization in the future into compliance retroactively from time of revocation (so that they may not enter any donation complications). Tax-exempt organizations that receive donations of significantly less than $50,000.00 can gain status backdated to enough time of revocation when they connect with be reinstated and pay a decreased fee of $100.00 in place of the regular fee of $400.00 or $850.00.

Implication on Donors

For donors, funds or aid provided to these revoked organizations prior to the revocation remain deductible for tax purposes. However, in the years ahead, a donor cannot make a donation to the revoked organizations and deduct such donations inside their tax returns. Therefore, it’s advisable for a donor to test with the IRS’s set of revoked organizations prior to making donations to avoid any inconveniences during tax time.

How exactly to be Reinstated

The IRS believes that a vast majority of the charity organizations which were revoked are defunct and therefore, you can find no consequences to the revocation. However, organizations which were revoked but which are still operational still have the opportunity to getting back to compliance. To take action, they’ll be required to perform a fresh application for registration and pay the relevant user fee. The payment of the fee also applies for organizations that were otherwise exempt prior to the revocation. However, to prevent the embarrassment of being listed on the revoked list, the IRS advises all tax-exempt organizations to ensure they offer the relevant documentation for them in good time.

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