Congress Considers Requiring the Smallest Nonprofits to File Annually
A number of other provisions potentially affecting charities are in a grab-bag tax reform bill.
After several failed attempts at nonprofit regulation reforms, passage may be doubtful, but at least a proposal is now on the table (PDF 455Kb) for reform of nonprofit reporting. Currently, organizations with income under $25,000 are not required to file. As a result, there are hundreds of thousands of nonprofits registered with the IRS that may not be active anymore. Far more organizations never file than file.
The provision before Congress (page 27 of the PDF file) would required an annual electronic filing of the name of the organization, any alternative names used, Internet address, name and address of a principal officer, taxpayer ID, and some proof of continued activity. Failure to file for three years would result in revocation of nonprofit status.
This administrative reform would be a very helpful in establishing the number of genuinely active charities in the US.
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