IRS Announces that 501(c)(3) Non-profit Organizations which Lost their Tax Exempt Status Are Now Eligible to Apply for Reinstatement

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According to 501(c)(3) experts at two non-profit formation firms, the IRS is offering leniency to some non-profit organizations that lost their tax exempt status for not filing their yearly IRS paperwork. The owners of Providence Writing Services and Richardson Writing Service say that non-profit organizations can now apply for reinstatement of their tax exemption for a fraction of what it costs to start at the beginning.

Every year thousands of non-profit organizations lose their tax exempt status because they didn’t know they had to file yearly documentation with the government. This offer from the IRS is the government’s way of offering some leniency to non-profits.

Experts at Providence Writing Services and Richardson Writing Service announce that 501(c)(3) non-profit organizations which lost their tax exempt status can now file to have that status reinstated for a $100 fee. In the past, organizations that lost their tax exemption had to start over again with the IRS and pay the full $400 or $850 fee that new non-profit organizations must pay when they first file for exemption with the federal government.

Joan Richardson, founder of Richardson’s Writing Service in Darling, Miss., has been preparing the documentation to create new non-profit organizations for almost 20 years, and she says too many organizations and even their lawyers are unaware of the changing laws regarding 501(c)(3) non-profit organizations.

“Every year thousands of non-profit organizations all over the United States lose their tax exempt status because they didn’t know that they had to file yearly documentation with the government,” Richardson says. “This offer from the IRS is the government’s way of offering some leniency to 501(c)(3) non-profit organizations that provide vital services to those in need.”

The greatest majority of organizations that lose their tax exempt status with the federal government do so because their directors don’t realize that they must file yearly reports with the IRS. Every organization, even those with gross annual receipts of less than $25,000, must file annually with the IRS. Prior to 2007, small organizations with receipts of less than that were not required to file annually with the IRS, and many non-profit directors are unaware of this change. Even some attorneys are unaware of this change in the law.

Michelle Jones, founder of Providence Writing Services in Highland, Ind., also prepares the documentation for new non-profit organizations. She says that the federal government is far more lenient with non-profit organizations than it is with individual taxpayers and for-profit companies, but even this leniency won’t last forever.

“Most non-profit organizations just don’t have the funds to cover such a costly mistake,” Jones says. “It seems pretty clear that the federal government wants to protect the non-profit organizations that provide so many services to people in need. You don’t want to squander that leniency by waiting too long.”

Any 501(c)(3) non-profit organization that has had its tax exempt status revoked by the IRS in recent years can apply for reinstatement at the reduced fee. The IRS regularly updates and publishes its lists of organizations that are about to have their tax exempt status revoked. The agency also releases lists of organizations that have recently had their status revoked. Directors can check the IRS website to find out the status of their organization.

Contact:
Joan Richardson, Richardson Writing Service
RichWS.com
Michelle Jones, Providence Writing Services
Michelle(at)ProvidenceWriting(dot)com
ProvidenceWriting.com
219-895-9291

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