September 12, 2006

New Tax Filing Requirement for Small Nonprofits

The Pension Protection Act of 2006 ccontains numerous changes to the tax law provisions affecting tax-exempt organizations, including a provision requiring exempt organizations not otherwise required to file the 990 information return to file an annual notice with the IRS. Organizations covered by the new law that are not currently required to file the form 990 information return include exempt organizations with gross receipts under $25,000.

The provision requires these organizations to furnish the following information to the Secretary annually, in electronic form:

1. the legal name of the organization,

2. any name under which the organization operates or does business,

3. the organization’s mailing address and Internet web site address (if any),

4. the organization’s taxpayer identification number,

5. the name and address of a principal officer, and

6. evidence of the organization’s continuing basis for its exemption from the generally applicable information return filing requirements.

Upon such organization’s termination of existence, the organization is required to furnish notice of such termination.

If an organization fails to provide the required notice for three consecutive years, the organization’s tax-exempt status is revoked. In addition, if an organization that is required to file an annual information return under section 6033(a) (Form 990) fails to file such an information return for three consecutive years, the organization’s taxexempt status is revoked.

The IRS will be providing further information on this requirement on its website at,,id=161145,00.html