Tuesday, August 31, 2010

SCV Camps Need to File IRS Paperwork or Could Loose Non-Profit Status

Note: While this articles is written about non-profits in South Carolina, SCV Camps everywehere must file to keep their non-profit status. Contact SCV headquarters if your camp is unsure on what is required and how to file.

IRS Deadline Upcoming

Hundreds of small charities and nonprofit organizations in the Upstate could be faced with losing their tax-exempt status because they've neglected to file annually with the Internal Revenue Service — putting tax-deductible donations in jeopardy.

IRS records show it has a list of small nonprofits, which includes those who can file the Form 990-N or 990-EZ, that haven't filed annually for the past three years. After three years of non-filing, the organizations automatically lose their tax-exempt status. The IRS, however, is giving a one-time amnesty until Oct. 15 for them to come into compliance.

The potential impact is far more sweeping than the organizations themselves losing their tax-exempt status. It could affect people making donations as of Oct. 15 to the organizations and claiming them as tax deductions, raising the risk of having those contributions disallowed.

In general, an organization can file a Form 990-N if its annual gross receipts are less than $25,000. If its annual gross receipts are less than $100,000 but more than $25,000, a nonprofit can file a Form 990-EZ.

The South Carolina list includes thousands of organizations with their last-known addresses while the Upstate has hundreds of charities listed. The organizations range from Shrine Temples to library funds to American Legion posts to community betterment organizations.

“I was surprised at how extensive the list is,” said Stephen Kirkland, a certified public accountant with Columbia-based Kirkland, Thomas, Watson & Dyches. “It is a big deal for those still in existence,” said Colleen Bozard, spokeswoman with the South Carolina Association of Nonprofit Organizations, a membership organization that provides support and services to the nonprofit sector. In addition to losing the ability for donors to receive tax exemptions on donations, the organizations can lose eligibility for government and community grants.
If they lose it, she said, “they lose a lot.”