TaxEsqBlog -by Ronald J. Cappuccio, J.D., LL.M.(Tax)

The head of the exempt organizations operation of the IRS has invoked her Fifth Amendment privilege not to testify before Congress. After giving a several minutes statement saying she was " not guilty of violating IRS rules and regulations .", Lois Lerner then declared her Fifth Amendment privilege. She is now been placed on leave , and actually replaced in the IRS. This just highlights an ongoing problem with exempt organization reviews by the IRS. There are no time limits requiring the IRS to start or complete a review of an application by an organization seeking to become a charitable organization for federal tax purposes. Also, there are no limitations on the questions that can be asked, nor the documents required. That Pres. Obama has use the IRS as a tool for his reelection campaign (joining former presidents Franklin Roosevelt, John F. Kennedy, Lyndon B. Johnson, Richard M. Nixon, and Bill Clinton) is not surprising. The lesson from this is clear. Congress must e...

A New York state appeals court held a center founded by a Catholic Priest, providing "spiritual renewal" to Catholics, partly by inspirational art created by visitors, is entitled to the property tax exemption denied by town officials. The court determined the group demonstrated sufficient proof that its complex is a "retreat" eligible for a charitable tax exemption under the state's Real Property Tax Law. Full Article

Small tax-exempt organizations must file Form 990-N The IRS and the Treasury Department have issued final regulations clarifying how and when certain small tax-exempt organizations must file an annual electronic notice. The final regulations finalize the temporary regulations without substantive change and affect small tax-exempt organizations whose annual gross receipts are not normally in excess of $25,000. They may be required to electronically submit Form 990-N, also known as the e-Postcard, unless they choose to file a complete Form 990 or Form 990-EZ. The Pension Protection Act of 2006 added this filing requirement to ensure that the IRS and potential donors have current information about tax-exempt organizations. The first e-Postcards were due in 2008 for tax years ending on or after Dec. 31, 2007. The e-Postcard is due every year by the 15th day of the 5th month after the close of the organization's tax year. For example, if the organization’s tax year ended on Dec. 31, 20...