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IMMEDIATE ATTENTION REQUIRED!!!
April 25, 2012
MEMORANDUM
TO:Chapter Presidents
RE:2011 Form 990 Filing Requirement for Chapters With an Accounting Year Ending December 31, 2011
As a follow up to chapter presidents’ memoranda previously sent, we are notifying you that the Internal Revenue Service (IRS) contends that tax-exempt organizations (including charities, social clubs, labor unions, etc.) that have an accounting year ending December 31, 2011, are at risk of losing their tax-exempt status if they do not file a 990, 990EZ, or 990-N (whichever applies to your chapter’s situation) by May 15, 2012.
In 2006, Congress passed the Pension Protection Act. This law mandated that all tax-exempt organizations, except churches and church-related organizations, file annual information returns (appropriate version of Form 990) with the IRS beginning in 2007. This was a new requirement for many small organizations. The law established strict consequences for failure to file — any organization that does not file an information return for three consecutive years automatically loses its federal tax-exempt status.
The first three-year deadline for filing was May 17, 2010 (for organizations with an accounting year end of December 31, 2009). When that deadline passed, the IRS found that many small organizations still had not filed. Because the IRS did not want these organizations to lose their tax-exempt status for not filing a simple form, the IRS provided one-time relief that allowed small exempt organizations (those organizations that are required to file a Form 990-N or 990-EZ) to come back into compliance and retain their tax-exempt status even though they failed to file for three consecutive years. If an organization loses its exemption, it will have to reapply to regain its tax-exempt status. Any income received between the revocation date and renewed exemption may be taxable.
This one-time relief opportunity has now expired and no new relief is scheduled to occur. It is imperative that chapters file the appropriate Form 990 on time each year. Again, any organization that does not file an information return for three consecutive years automatically loses its federal tax-exempt status.
It is critical that every chapter be absolutely certain that it has filed the version of
Form 990 that is appropriate for their particular situation. For 2011 tax years, the IRS states that organizations with annual gross receipts of $50,000 or less can file a Form 990N e-postcard, a simple process that requires eight basic pieces of information. Organizations with gross receipts less than $200,000 and total assets less than $500,000 can file the Form 990 EZ for 2011.
Attached to this memo is the Annual Information Return filing Chart from the IRS to determine if your chapter was/is eligible to submit Form 990-N (e-postcard) for the 2010 (and later) tax years or file the Form 990-EZ for the 2007, 2008, and 2009 tax years.
Please note that the new filing requirement began with tax periods beginning after December 31, 2006. The electronic annual filing will be due by the 15th day of the fifth month after the close of the tax period.
- For chapters that have a tax period beginning on October 1, 2010 and ending on September 30, 2011, the 2010 annual electronic notice filing was due on February 15, 2012.
- For those chapters that have a tax period beginning on January 1, 2011 and ending on December 31, 2011, the 2011 annual electronic notice filing will be due on May 15, 2012.
Attached to this memorandum is a copy of the 2009 Publication 4752 from the IRS entitled The New e-Postcard (Form 990N). We have also attached frequently asked questions regarding this issue.
If you have any questions about this requirement, you can visit the IRS’s web site at or contact Steve Peterson, NTEU’s Administrative Controller, at 202-572-5500, extension 7007 or via e-mail at .
Colleen M. Kelley
National President
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