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Executive Seeds
An
occasional series from |
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Ministry Leader, 131 pages
of final 403(b) regulations released by the IRS today. A
first reading suggests that the issues previously outlined to you are
the key issues in the new document.
Also, a
quick reminder of a new requirement coming for small non-profits.
While your organization may not fit this category, many of you serve on
Boards or have been active in starting new 501(c)(3) ministries.
Note that the reporting requirement starts in
2008 and look for the notice from the IRS in the mail. Freedom to minister when the paycheck stops is our
definition of a "Future-Funded Ministry" Plan.
We have special plans for small ministries as well as for large
ones. Call us for information, help and support. Many are
connecting and are happy they did. IRS to Notify Small Tax-Exempt Organizations of WASHINGTON - The Internal Revenue Service today
announced that it began mailing educational letters this month to more
than 650,000 small tax-exempt organizations that may be required to
submit a new annual notice, Form 990-N, "Electronic Notice (e-Postcard)
for Tax-Exempt Organizations Not Required to File Form 990 or 990-EZ." IRS expects to mail the letters over a period of
several months, finishing in December. With the enactment of the
Pension Protection Act of 2006 (PPA), the majority of small tax-exempt
organizations are now required to submit the e-Postcard.
Previously, tax-exempt organizations with gross receipts of
$25,000 or less were not required to submit information returns.
The first e-Postcards are due in calendar year 2008. The
IRS intends to have an option available for free electronic submission
of the e-Postcard. "We're sending these educational letters to all the
small exempt organizations in our records because we want to make sure
they all know about the new requirement," said Lois G. Lerner, director
of the IRS Exempt Organizations division. "The new e-Postcard reporting
requirement is simple and straightforward, but organizations shouldn't
ignore it, or they risk losing their tax-exempt status." Any organization that fails to meet its annual
reporting requirement for three consecutive years automatically loses
its tax-exempt status under the new law. An organization that wants to
regain its exempt status will then have to reapply for recognition as a
tax-exempt organization. Short, Easy, Free
and Electronic "The IRS calls the new form an e-Postcard because it is short, easy and electronic," Lerner said. "And organizations will be able to submit it free of charge." The e-Postcard requires small organizations to provide
a legal name and mailing address, any other names used, a Web address
if one exists, the name and address of a principal officer and a
statement confirming the organization's annual gross receipts are
normally $25,000 or less. In addition to sending out educational letters, IRS is
encouraging everyone - individual volunteers, tax practitioners
and larger organizations - to spread the word about the new
e-Postcard reporting requirement. "People do a lot to help their communities by volunteering their time and money to local charities. We're asking them to also offer a helping hand by making sure that charities know about the law change," Lerner said. "We don't want those organizations to lose their tax-exempt status because they didn't know about the new reporting requirement." The IRS is developing a free reporting system for the
e-Postcard and an application to make the information available to the
public on IRS.gov. Information about these systems will be
announced as soon as it becomes available. Further details, including exceptions to the reporting
requirement and a copy of the educational letter, are available in the
charities and non-profits section of IRS.gov.
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