IRS webinar: File Error-Free Form 1023-EZ

The Tax Exempt and Government Entities Division invites you to register for the free File Error-Free Form 1023-EZ webinar on Thursday, February 4, 2021; 1 p.m. Eastern Time.

This webinar is designed to help smaller organizations that are filing for tax exemption determine:

• Who can use Form 1023-EZ to apply for tax exemption
• How to submit the form
• Differences between Form 1023 and Form 1023-EZ
• Form 1023-EZ eligibility requirements

For further details, see Webinars for Tax Exempt & Government Entities.

IRS revises Form 1024-A, application for Section 501(c)(4) tax-exempt status as part of ongoing efforts to improve service

IRS news release: As part of ongoing efforts to improve service for the tax-exempt community, the Internal Revenue Service issued the revised Form 1024-A, Application for Recognition of Exemption Under Section 501(c)(4) and its instructions to allow electronic filing.

Mandatory E-filing of Form 4720 by Private Foundations

Notice 2021-01 provides that, while subject to a delay, private foundations must electronically file Form 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code, as required by Section 3101 of the Taxpayer First Act of 2019 (Pub. L. No. 116-25), which amended Section 6033 of the Internal Revenue Code. Until the electronic Form 4720 is made available, private foundations may continue to use the paper form.  Private foundations may no longer rely on Treas. Reg. § 53.6011-1(c) as a result of this electronic filing mandate. 

Annual Revenue Procedures

Internal Revenue Bulletin: 2021-1 has been issued, which includes Revenue Procedure 2020-5, the annually updated procedures for issuing determination letters on issues under the jurisdiction of the Director, Exempt Organizations (EO) Rulings and Agreements. These procedures also apply to revocation or modification of determination letters. The revenue procedure also provides guidance on the exhaustion of administrative remedies for purposes of declaratory judgment under § 7428 and provides guidance on applicable user fees for requesting determination letters.

Section 2.01 of the revenue procedure describes notable changes that appear in this year’s update, including:

• incorporating information and procedures from Rev. Proc. 2020-8 for the electronic submission of Form 1023;
• clarifying that Form 3115, Application for Change in Accounting Method, is not a request for a determination and to explain how a tax-exempt organization may change its method of accounting;
• reflecting that pursuant to Notice 2020-36, the Service will not accept any requests for group exemption letters until publication of the final revenue procedure described in the Notice or other guidance in the Internal Revenue Bulletin;
• providing clarification on relief under Treas. Reg. §§ 301.9100-1 through -3; and
• noting that additional guidance may be provided in the future to clarify the Independent Office of Appeals’ role in matters covered by this revenue procedure.

Internal Revenue Bulletin 2021-1 also includes the following annually updated revenue procedures that may be of interest for tax-exempt organizations:

• 2021-1  This procedure contains revised procedures for letter rulings and information letters.
• 2021-2  This procedure explains when and how an Associate office within the Office of Chief Counsel provides technical advice, conveyed in technical advice memoranda (TAMs).
• 2021-3  The revenue procedure provides a revised list of areas of the Code relating to matters on which the Service will not issue letter rulings or determination letters

Free Online Training for Small to Mid-Sized Section 501(c)(3) Charities

The IRS provides interactive online training to help officers, board members, and volunteers maintain your organization’s tax-exempt status. The Virtual Small to Mid-Sized Tax-Exempt Workshop at StayExempt.irs.gov is an important resource for all charities, old and new.