REVOKED! Reinstating Your Tax Exempt Status

Last time we discussed what to do if you file your Form 990 series return late, and briefly touched upon what to do if you lose tax exempt status.

Now, we’re going to peel back the layers a bit more and get into the steps for reinstating revoked tax exempt status.

So You've Been Revoked

How do nonprofit organizations lose their tax exempt status? The easiest way is failing to file Form 990 for three consecutive years. That leads to you ending up on the Exempt Organization Select Check list published every month by the IRS.

The good news? You can search the EO Select Check list for your Employer Identification Number to find out if you’ve been revoked! The list is updated monthly, and features the name, EIN, organization type, last known address the organization provided to the IRS, effective date of revocation, and the date the organization was added to the list.

How to Get Reinstated

If an organization wants to get their tax exempt status reinstated, they must file a new application for exemption and pay the appropriate user fee.

The IRS then determines if the organization meets the requirements, and can issue a new determination letter.

The IRS will also include the reinstated organization in the next update of EO Select Check and indicate in other publications (like the Business Master File).

In most situations, the effective date of reinstated exemption is the date the current application was submitted, but organizations can request for a retroactive reinstatement.

Can You Get Retroactive Reinstatement?

But retroactive reinstatements have limited circumstances attached to them, and it is up to the organization to supply the IRS with the needed information.

To request reinstatement back to the date of automatic revocation, organizations need to attach a letter to the application for reinstatement explaining why they failed to file required returns for three consecutive years.

After that, the IRS will determine if your organization had a reasonable cause for not filing your return for three years.

Once you’re reinstated, you need to keep up to date on your tax exempt returns! When you e-file your Form 990 series return with ExpressTaxExempt, you can expect a secure, easy-to-use system designed to have you done in no time.

If you have any questions about e-filing, contact us by phone at 704.839.2321 or by email at Support@ExpressTaxExempt.com.

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Find Your Tax Year Dates

One of the most common reasons we see a Form 990-N (e-Postcard) rejected is because of incorrect tax year periods. It’s a rejection with a fairly simple fix, but we understand why it happens, especially if you’re filing your organization’s tax return for the very first time. You may not be aware of your organization’s tax year period, also known as accounting period, or the fact that such a thing exists.

Usually, you would have to get in contact with the IRS Tax-Exempt Hotline to inquire about your exemption status, Employer Identification Number (EIN), and things of that nature. But the IRS also has what they call their EO Select Check; the “EO” stands for Exempt Organization. The page allows you to look up your tax-exempt organization and view whether you:

• Are eligible to receive tax-deductible, charitable contributions
• Were automatically revoked
• Have filed Form 990-N (e-Postcard)

If you been placed to file your exempt organization’s tax return for the first time, and you don’t happen to know your tax period, you should select the third option (Have Filed Form 990-N (e-Postcard)) and search using your organization’s EIN. If your organization has filed a Form 990-N (e-Postcard) before, you’ll see a list of each year it was filed. Click on your organization’s name, and it’ll show details about the filing. And at the very top, you’ll see the correct tax period for your organization.

For more information about the IRS EO Select Check, be sure to check out the following blog:

All About the EO Select Check

IMPORTANT: Keep in mind that there are two types of tax year periods, or accounting periods.

If your tax period is listed as from January 1 to December 31, then your organization operates on what is called a Calendar Tax Year; many exempt organizations have this type of tax year.
If your tax period begins or ends any date other than January 1 or December 31, like from October 1 to September 30 for instance, your tax period is considered as a Fiscal Tax Year.

Be sure to select the most appropriate tax year when e-filing a Form 990-N (e-Postcard), or any 990 form, for your organization.

For more information about accounting periods, you should consider reading

What Is A Fiscal Year?
What is an Accounting Period?

Once you know what your exempt organization’s tax period is, you can e-file your Form 990-N (e-Postcard) quickly and easily with Express990. Simply enter your organization’s details, select your tax period, indicate gross receipts are less than $50,000, authorize, and transmit to the IRS; it takes less than 10 minutes.

You can also e-file from anywhere you may be with our FREE Express990 App for iOS/Android tablets, or our mobile site designed for any web-enabled mobile phone.

For any questions or assistance with our e-filing service, feel free to contact our live, expert help at our headquarters in Rock Hill, South Carolina.
Phone: (704) 839-2321 (Monday - Friday, 9 a.m. - 6 p.m., Eastern Standard Time)
Email: support@expresstaxexempt.com
Live Chat: www.expresstaxexempt.com

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