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Hawaii News

Notice for nonprofits: File with IRS

Small nonprofits are being reminded they are now required to file annual forms with the IRS to retain their tax-exempt status.

The deadline to file was May 17, but the IRS has urged nonprofits that have not yet filed to do so or to seek extensions.

Hundreds of small nonprofits — from PTAs to "friends of" groups — in the islands are believed to have missed the deadline. Thousands more across the country also have not filed.

"Now that the May 17 filing deadline has passed, it appears that many small tax-exempt organizations have not filed the required information return in time," IRS Commissioner Doug Shulman said in a statement. "These organizations are vital … and I understand their concerns about possibly losing their tax-exempt status."

Shulman said though the IRS conducted "an unprecedented outreach effort" to educate nonprofits on the new rules, many small nonprofits did not get the message. "I want to reassure these small organizations that the IRS will do what it can to help them avoid losing their tax-exempt status," he said.

Nonprofits that brought in less than $25,000 were previously not required to file IRS 990 forms.

Now all organizations with nonprofit status must file (though there are still some exceptions).

Jennifer Creed, director of member and professional development at the Hawaii Alliance of Nonprofit Organizations, said nonprofits that have not filed are smaller organizations mostly or exclusively run by volunteers.

Creed said the alliance tried to get the word out to small nonprofits about the rule changes and will continue to try to let nonprofits know they should file, even though the deadline has passed.

She said the time to file is now because it will not be long before the IRS starts stripping noncompliant organizations of their tax-exempt status.

There are more than 7,000 nonprofits in the islands — more than 5,000 of which had gross receipts in 2007 of less than $25,000, according to the alliance.

Small nonprofits can file their forms online. For more information, go to www.irs.gov.

 

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