April 16, 2007

Exempt Status Not Affected by Expanding Purposes

The IRS ruled that the tax-exempt status of a scientific research organization that studies indoor air quality will not be adversely affected when the organization expands its purposes to transform the region where it is located into a leader of environmental research.
Ltr. Rul. 200714026

April 12, 2007

TY 2006 EO Returns - Significant Changes

The instructions to the 2006 Forms 990 and 990-EZ and Schedule A incorporate significant changes to address legislation enacted in 2006 and comments received from the public. The following are highlights of the significant changes.
IRS officials have highlighted these changes in two public forums; resources from those events may also be of interest
  • Telephone conferences conducted on March 21 and 22, 2007. The text of the presentation can be found here.
  • A Tax Talk Today program highlighting legislative changes to exempt organizations tax law
  • click here
    For more information, click here or see the What’s New section of the form instructions.

    April 09, 2007

    New Electronic Filing Requirement for Small Tax-Exempt Organizations

    Annual Electronic Notice — e-Postcard (Form 990-N)

    Beginning in 2008, small tax-exempt organizations that previously were not required to file returns may be required to file an annual electronic notice, Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations not Required To File Form 990 or 990-EZ. This filing requirement applies to tax periods beginning after December 31, 2006.

    For more information, click here
    Frequently Asked Questions

    April 04, 2007

    Income From Trade Show Activities Not Unrelated Business Income

    The IRS has ruled that income a tax-exempt trade group received from its activities with a for-profit trade show operator is not unrelated business income because the activities are substantially related to the trade group's exempt purpose.

    "X is exempt from federal income tax as an organization described in section 501(c)(6) of the Code. X represents the a industry to government, media, business and consumers.

    Y is a for-profit entity that owns and operates several trade shows for the a industry. The trade shows are held annually around the world, and promote and stimulate interest in the a Industry. The industry is promoted through exhibits and educational programming. The trade shows provide a gathering place for industry professionals to exchange ideas, know-how and exhibit their wares. The educational programming provides ideas for solutions to industry problems; offers trends and innovations; and, promotes awareness of the industry legislative objectives and legal compliance imperatives. The trade shows draw a wide variety of members of the industry, and also attract many consumers of industry products. They attract approximately u attendees and approximately v exhibitors and related staff.

    X and Y entered into a b Agreement and subsequently executed a c Agreement that provide the terms and conditions by which X will sponsor two of the annual trade shows conducted by Y."

    Under these conditions, the IRS determined that "Conference Net Profit Revenue and Sponsorship Revenue received by X is substantially related to the activities of the organization, and the income therefore is not unrelated business income."

    Ltr. Rul. 200713024