August 4, 2010

The Internal Revenue Service has announced a one-time, special relief filing program for small nonprofits that are at risk of losing their tax-exempt status because of a recent change in the law. The new deadline is Oct. 15. The Nonprofit Leadership Initiative in the University of Kentucky College of Agriculture encourages employees, volunteers and supporters of nonprofits, especially smaller nonprofits, to urge their organization to take simple, immediate steps to ensure it does not lose its tax-exempt status.

In 2006, Congress passed a law requiring all nonprofits-including those with revenue of less than $25,000 that used to be exempt from annual filing requirements-to file Form 990-N with the IRS. The new law assumes that an organization that does not file for three consecutive years is defunct and revokes that organization's tax-exempt status. In May, Kentucky launched a statewide awareness campaign to spread the word about the filing deadline. However, many nonprofits did not hear about the deadline and are now at risk of losing their tax-exemption if they do not file by the new extended deadline. The IRS has published a list of all the nonprofits in each state that still may need to file. That list shows that 4,194 Kentucky nonprofits face the costly and time-consuming prospect of losing their status as tax-exempt organizations if they do not act by Oct. 15.

"The Nonprofit Leadership Initiative is continuing our efforts to spread the word to the many organizations identified on the new list just issued by the IRS," said Danielle Clore, director of the initiative. "Through our Kentucky Nonprofit Network, we have regular contact with our members, but there are some nonprofits that are not yet members and have not heard about the risk of missing this deadline. We encourage anyone involved with small nonprofits to check whether the nonprofit they care about is on the IRS list"

Typically small nonprofits with annual gross receipts of less than $25,000, file an electronic version of IRS Form 990-N, which is also known as the ePostcard. It's free to file and only has eight simple questions that can be filled out in a few minutes. Larger organizations must file Form 990 or 990-EZ. Larger nonprofits that missed the deadline earlier this year can participate in a voluntary compliance program as long as they file by Oct. 15.

More information, including a link to the IRS list of name and last known addresses of organizations at risk in Kentucky, is available at the Nonprofit Leadership Initiative's website, If you have questions or concerns, please contact the Nonprofit Leadership Initiative at or 859-257-2542.

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