Guidance for Tax Exemption Reinstatement

Published:

imageby Abbey Lakin and Amanda Meko, CPA | Team Members of the Not-For-Profit Services Group

On June 8, 2011 the IRS announced that approximately 275,000 organizations automatically lost their tax-exempt status because they failed to file an annual return or an electronic notice (Form 990-N e-postcard) for 2007, 2008, and 2009.

The IRS has published a list of organizations who have had their status automatically revoked on their website. You can view the list by following this link Automatic Revocation of Exemption List

The IRS also issued Notice 2011-43 which provides guidance for small (gross receipts of less than $50,000), exempt organizations that have lost their tax-exempt status on how to apply for reinstatement of tax-exempt status and request retroactive reinstatement.

Organizations normally having annual gross receipts of $50,000 or less and applying for reinstatement of exempt status by 12/31/2012 will be treated by the IRS as having established reasonable cause for its filing failures and its tax-exempt status will be reinstated retroactive to the date it was automatically revoked.