New IRS Notification process for 501(c)(4) Nonprofit Organizations

In December 2015, the IRS revealed a new requirement for certain nonprofit organizations to submit notification of their formation as an organization. However, this was delayed until the IRS was able to issue an appropriate form.  The long awaited form is now here. Form 8976, the Notice of Intent to Operate under Section 501(c)(4).

A 501(c)(4) organization generally is a social welfare organization (formed primarily to further the common good and general welfare of the people of a community) or a local association of employees (ie: homeowner’s association or volunteer fire department).  Organizations formed for charitable, educational or similar purposes are known as 501(c)(3) organizations. They are not permitted to engage in political activities, endorse or oppose political candidates, donate money or time to political campaigns, and have limitations on lobbying activities.  But 501(c)(4) organizations can do all of these.

By law now, any organization which has not either;

  1. applied for a determination letter (by filing IRS Form 1024); or
  2. filed at least one annual information return or notice (Form 990, Form 990-EZ, or 990-N)

must file by September 6, 2016 if it was formed on or before July 8, 2016. For any future organizations being formed, forms must be filed 60 days after an entity’s date of organization.

Forms must be submitted online at the IRS Registration Services website. Note that forms will only be accepted online and not in paper form. The application fee is $50.00 and can be paid at Failure to file the forms on time will result in a penalty of $20.00 per day up to $5,000.

More information can be found here.

Please do not wait until the last minute to file. If you have any questions, please contact us and we will be more than happy to assist you in any way possible!


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