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Nonprofits May Lose Tax-Exempt Status
The IRS has implemented the requirement for little known form that could jeopardize the tax-exempt status of over 200,000 nonprofits that operate on an annual budget of $25,000 or more.
Suzanne Coffman, a spokeswoman for GuideStar which tracks data on nonprofits says, “The nonprofits in your backyards, some of them are going to be gone.”
Form 990-N is now required for smaller nonprofits, per the tax code revisions passed by Congress three years ago. It’s not clear why these 200,000 charities have not submitted the form and thereby have put their tax-exempt status in question. Without this status, donations are not tax deductible, which could hurt the nonprofits.
- Source: Associated Press 05/16/10.