Wednesday, August 20, 2014

Status of EO Application Backlog

Tax Notes Today (subscription required) reports that the Internal Revenue Service’s Tax-Exempt and Government Entities Division is progressing significantly in clearing its backlog of exempt organization applications that existed as of the beginning of the year. TE/GE Deputy Commissioner Donna Hansberry is quoted as saying that the IRS has now closed 97 percent of the 15 percent of exempt organization applications which, at the beginning of fiscal 2014, were more than one year old.

A major reason for the backlog serves as a helpful practical reminder to exempt organizations (especially small ones) and their advisors.  Hansberry attributes the increase in applications since 2010 to the rule (enacted as part of the Pension Protection Act of 2006) that automatically revokes the exemption of an organization that fails to file an information return for three consecutive years.

Electronic citation: 2014 TNT 161-5

JRB

http://lawprofessors.typepad.com/nonprofit/2014/08/status-of-eo-application-backlog.html

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