Louis E. Michelson, A Professional Corporation

Providing Legal and Tax Advisory Services to Nonprofit Organizations

Entries Tagged as 'tax-exempt status'

How to Rescue a Troubled Nonprofit: California Considerations

February 8th, 2017 · Comments Off on How to Rescue a Troubled Nonprofit: California Considerations · California Attorney General enforcement, California Exempt Status, reinstating California exempt status, restoring good standing with CA Secretary of State

Did your nonprofit organization lose its California tax-exempt status? It the organization suspended with California Secretary of State? Has the organization been suspended by the California Attorney General? What needs to be done to reinstating the exemption for California income tax purposes? How does one restore “good standing” status with the California Secretary of State? […]

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Reduced User Fee for Form 1023-EZ Effective July 1, 2016

June 17th, 2016 · Comments Off on Reduced User Fee for Form 1023-EZ Effective July 1, 2016 · Form 1023-EZ

Good news ahead for small charitable organizations that will be filing the electronic application for tax-exemption, Form 1023-EZ, Streamlined Application for Recognition of Exemption under Section 501(c)(3) of the Internal Revenue Code.  A user fee is required by the IRS to process the Form 1023-EZ application, which user fee had been previously set at $400 […]

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How Do You Know a “Church” is a “Church” for Tax Purposes?

May 16th, 2016 · Comments Off on How Do You Know a “Church” is a “Church” for Tax Purposes? · church, exempt status

Frequently Asked Questions. Do churches register with the federal and state government?  How do you know if a church is recognized as a “church” for federal income tax purposes and for state income tax purposes?  By the way, the term “church” is not limited to Christian churches, but also applies to other religions, so there […]

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Preserving the Charitable Deduction Traps for the Unwary: Identity of the Donee and Tax-Exempt Status Instructional Video

March 9th, 2016 · Comments Off on Preserving the Charitable Deduction Traps for the Unwary: Identity of the Donee and Tax-Exempt Status Instructional Video · charitable contributions, Charitable deduction

This instructional video covers the following topics: ● Who is the Donee? ● Verification of Exempt Status ● Automatic revocation ● Donor Due Diligence

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Extended Due Date for Notification by Social Welfare Organizations of Intent to Operate

January 20th, 2016 · Comments Off on Extended Due Date for Notification by Social Welfare Organizations of Intent to Operate · Federal Income Taxes, Uncategorized

Social welfare organization must provide a notification to the IRS of their intent to operate.  This notification requirement is found in new Section 506, which was added to Internal Revenue Code by the Protecting Americans from Tax Hikes Act of 2015 (the “PATH Act”) which was enacted on December 18, 2015. Under the PATH Act: […]

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Streamlined Exemption Application – Being Considered

April 18th, 2014 · Comments Off on Streamlined Exemption Application – Being Considered · private inuremenet, tax exemption

Currently the only way to obtain recognition of 501(c)(3) status is to apply for tax-exemption using IRS Form 1023. The key word is “currently.” A new streamlined application was drafted by the IRS and is being considered for use by small organizations. It was submitted to the Office of Management and Budget for review under […]

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Charities/501(c) (3) and Social Welfare Organizations/501(c) (4): What’s the Difference?

May 20th, 2013 · Comments Off on Charities/501(c) (3) and Social Welfare Organizations/501(c) (4): What’s the Difference? · Charity, Loss of Tax-Exempt Staus, social welfare 501(c)(4)

What is the difference between a charity which is tax-exempt under IRC Section 501(c) (3) and Social Welfare Organization tax-exempt under IRC Section 501(c) (4)?   Per the Regulations, a 501(c)(4) organization is one that is operated exclusively for the promotion of social welfare if it is primarily engaged in promoting in some way the […]

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Automatic Revocation of Exemption List

March 16th, 2013 · Comments Off on Automatic Revocation of Exemption List · Loss of Tax-Exempt Staus

Most tax-exempt organizations are required to file an annual return or notice with the Internal Revenue Service.  Section 6033(j) of the Internal Revenue Code automatically revokes the exemption of any organization that fails to satisfy its filing requirement for three consecutive years. The automatic revocation of exemption is effective as of the due date of […]

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Automatic Revocation of Exemption: In Error?

July 29th, 2012 · Comments Off on Automatic Revocation of Exemption: In Error? · Federal Income Taxes, Loss of Tax-Exempt Staus

Background: The Pension Protection Act of 2006 made two important changes affecting tax-exempt organizations, effective the beginning of 2007.  First, it requires all tax-exempt organizations, other than churches and church-related organizations, must file an annual return with the IRS. That includes small tax exempt organizations with gross receipts of $25,000 or less and had not […]

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When Providing Consulting Services Ruins 501(c)(3) Exemption

July 6th, 2012 · Comments Off on When Providing Consulting Services Ruins 501(c)(3) Exemption · Consulting services, Denial of Exemption, private inuremenet

It is common for a new nonprofit to draw on the experience of its founders.  Is there any reason that a nonprofit can not provide consulting services?  If the new nonprofit seeks to obtain tax-exempt status under 501(c)(3) there are a number of pot-holes to avoid, based on a recent ruling by the Sixth Circuit […]

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