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Archive for the ‘Nonprofit’ Category

Tax-Exempt Companies and IRS Form 990-N

Posted on January 31st, 2012 by Joey Donovan Guido
Category: How To Information, Nonprofit, Small Business, Small Business News

IRS-Form-990-N.jpegHave you heard of the IRS Form 990-N?

If you haven’t, you are not alone. But that doesn’t mean it’s not an important form. In fact, if it’s not filled out for three consecutive years a company will automatically lose its tax-exempt status.

In an effort to help your nonprofit organization remain compliant, we’ve put together this brief article to give you a quick overview of the form and whether or not you’ll need to actually file one.

The first thing you’ll need to determine is whether you’re a tax exempt organization with annual gross receipts that are usually $50,000 or less. If you are, filing IRS Form 990-N (e-Postcard) is typically required. Companies can also file a complete Form 990 or Form 990-EZ, instead of the e-Postcard.

Due Date of the e-Postcard

According to the IRS, “the e-Postcard is due every year by the 15th day of the 5th month after the close of your tax year. For example, if your tax year ended on December 31, the e-Postcard is due May 15 of the following year. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is the next business day. You cannot file the e-Postcard until after your tax year ends.

Filing IRS Form 990-N

Click here to file your form. The IRS has partnered with the Urban Institute to make this form available for completion online. This form must be completed and filed electronically. There is no paper version.

What You Need to Complete the e-Postcard(according to the IRS):

  1. Employer Identification Number (EIN), also known as a Taxpayer Identification Number (TIN)
  2. Tax year. Are you following a calendar tax year, or a fiscal tax year?
  3. Legal name and mailing address
  4. Any other names the organization uses
  5. Name and address of a principal officer
  6. Web site address if the organization has one
  7. Confirmation that the organization’s annual gross receipts are normally $25,000 or less ($50,000 for tax years ending on or after December 31, 2010)
  8. If applicable, a statement that the organization has terminated or is terminating (going out of business)

For more information, please visit the IRS Form 990-N page.

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Choosing a Tax-exempt Status for Nonprofit Companies

Posted on January 27th, 2012 by Joey Donovan Guido
Category: How To Information, Incorporate a Business, Nonprofit, Small Business, Start A Business

Tax-Exempt

Nearly everyone’s heard of the infamous 501(c)(3) tax-exempt formation. But did you know that there are other no less than 32 tax-exempt options for nonprofits?

To follow is a listing of four of the most popular ones — including 501(c)(3) — along with a brief description of what makes each of them unique …

501(c)(3)

These are typically public charities or private foundations established for a variety of purposes including: religious, educational, charitable, scientific, literary, testing for public safety, fostering of national or international amateur sports, or prevention of cruelty to animals and children.

  • Application form number: 1023
  • Annual return required to be filed: 990 or 990EZ, or 990-PF
  • Charitable contributions allowable: Typically, yes

501(c)(4)

Geared toward civic leagues, social welfare organizations, and local associations of employees. This type of nonprofit generally promotes community welfare, as well as charitable, educational and recreational endeavors.

  • Application form number: 1024
  • Annual return required to be filed: 990 or 990EZ
  • Charitable contributions allowable: No, generally

501(c)(6)

This type of nonprofit is often a business league, chamber of commerce, or real estate boards. The general nature of activities involves improvement of business conditions of one or more lines of business.

  • Application form number: 1024
  • Annual return required to be filed: 990 or 990EZ
  • Charitable contributions allowable: No

501(c)(7)

Consisting predominantly of social and recreation clubs, this type of nonprofit organization focuses on pleasure, recreation and social activities.

  • Application form number: 1024
  • Annual return required to be filed: 990 or 990EZ
  • Charitable contributions allowable: No

A Note on Defining Your Business Purpose
Your business purpose is an explanation of what your nonprofit corporation is formed to do or provide. Having a very detailed description is essential. If you plan to apply for tax-exempt status, the IRS will require a copy of your Articles of Incorporation and will pay particular attention to your business purpose and use it to classify your business.

For a complete list of nonprofit, tax-exempt formation choices, visit our IRS Organization Reference Chart.

We’re Here to Help
If you have questions, or would like assistance with forming a nonprofit company, feel free to give our customer service team a call between 8am and 7pm CST, at 800-981-7183. Or, send us an e-mail anytime. We’re always happy to help.

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