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Our Staying Legal page is brought to NH Nonprofits in collaboration with the NH Division of Charitable Trusts. Besides basic information about staying legal we offer Staying Legal Updates on nonprofit regulatory issues from Michael DeLucia, Director of Charitable Trusts and Terry Knowles, Registrar of Charitable Trusts, The Division of Charitable Trusts, NH Department of Justice. News and Resources IRS E-File System Suspended for 2-Months Extensions Granted to Nonprofits with Due Dates on 1/17 or 2/15 January 10, 2012 - In order to facilitate systems and programming changes, the IRS has notified tax-exempt organizations that the IRS Modernized e-file (MEF) system will not be available from January 1, 2012 through February 29, 2012 for electronic filing of Forms 990, 990-EZ, 990-PF and 1120-POL information returns. The IRS is suspending the availability of the system to implement changes to IRS programs and systems for the 2011 tax year. The 990-N e-postcard filing system will not be affected by the temporary suspension of the MeF system. To minimize the impact on affected organizations, the IRS is granting an extension of time to file to March 30, 2012 to organizations whose due date or first extended due date for returns is January 17, 2012 or February 15, 2012. Read more... Reminder - Safety Summary Forms Due December 6, 2011 - Its time to submit the Safety Summary Form (SSF) for filing year 2012. The companies that filed their last SSF in 2010, it is time to submit for 2012. The SSF must be filed biennially; it can also be filed annually for your convenience. Methods of filing are: online, hardcopy or fax. Please do not send more than one SSF per company. If you have any questions, email safety@labor.state.nh.us; please include your Company Name and Federal Identification Number. For more information on who, when, how and why please go to the NH Dept of Labor’s web Safety Page Online and downloadable forms can be found at: www.labor.state.nh.us/safety_training_forms.asp Reactivating Tax-Exempt Status Through "Special Procedures" July 26, 2011 - If your organization is one of the 275,000 organizations nationwide had their tax-exempt status revoked and you have annual gross receipts below $50,000, the IRS has special provisions that allow you to apply for reinstatement before the end of 2012. This article from the Law Offices of Devine Millimet outlines the procedures that can be taken. The IRS has also posted a video on the topic. IRS Releases Automatic Revocation List Jne 10, 2011 - On June 8, 2011, the Internal Revenue Service (IRS) released a list of more than 275,000 nonprofits that had their tax-exempt status automatically revoked due to failure to file annual returns. This page from the National Council of Nonprofits contains resources related to this issue Congress Urged to Set Time Limit on Revoking Tax-Exempt Status January 7, 2011 - The national taxpayer advocate has recommened that Congress should enact a statute of limitations to limit the retroactive effect of revocation of an organization’s exempt status. The advocate points out a procedural loophole through which the IRS may revoke an organization's exempt status for years that it cannot collect additional tax due to a statute of limitation. The time limit would not apply in cases of fraud, tax evasion or non-filing of the return. Read more on page 8 of this document (marked as page 350) IRS Announces 2011 Standard Mileage Rates January 5, 2011 - Washington — The Internal Revenue Service has issued the 2011 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. Beginning on Jan. 1, 2011, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 51 cents per mile for business miles driven 19 cents per mile driven for medical or moving purposes 14 cents per mile driven in service of charitable organizations Learn more... Does Your Small Nonprofit Qualify for the Health Care Tax Credit? September 13, 2010 -Sector leaders from New Hampshire and across the country advocated to ensure that nonprofits would be included in the Small Business Health Care Tax Credit, but how do you know if your organization qualifies, and if it does, how do you claim this credit? Who is eligible The IRS has published information on the eligibility rules. In simple terms, a qualifying employer has less than 25 full-time workers with average wages below $50,000 and must cover at least 50% of the cost of health care for some of its workers based on the single rate. More detailed information about eligibility can be found at: http://www.irs.gov/newsroom/article/0,,id=223666,00.html How to claim the credit Tax-exempt organizations will claim the small business health care tax credit on a revised Form 990-T. The Form 990-T is currently used by tax-exempt organizations to report and pay the tax on unrelated business income. Form 990-T will be revised for the 2011 filing season to enable eligible organizations –– even those that owe no tax on unrelated business income –– also to claim the small business health care tax credit. At this time, the IRS has released a draft of the form that for profit small businesses will use, but has not released a draft of the revised form 990-T. We will have more information on this form when it becomes available. IRS Releases Form to Help Small Businesses Claim New Health Care Tax Credit September 09, 2010 - The Internal Revenue Service has released a draft version of the form that small businesses and tax-exempt organizations will use to calculate the small business health care tax credit when they file income tax returns next year. The IRS also announced how eligible tax-exempt organizations - which do not generally file income tax returns - will claim the credit during the 2011 filing season. The IRS has posted a draft of Form 8941 to this website. Both small businesses and tax-exempt organizations will use the form to calculate the credit. A small business will then include the amount of the credit as part of the general business credit on its income tax return. Tax-exempt organizations will instead claim the small business health care tax credit on a revised Form 990-T. The Form 990-T is currently used by tax-exempt organizations to report and pay the tax on unrelated business income. Form 990-T will be revised for the 2011 filing season to enable eligible tax-exempt organizations –– even those that owe no tax on unrelated business income –– also to claim the small business health care tax credit.The final version of Form 8941 and its instructions will be available later this year. Read more... IRS Offers One-Time Special Filing Relief Program for Small Charities July 27, 2010 - Washington, DC - Small nonprofit organizations at risk of losing their tax-exempt status because they failed to file required returns for 2007, 2008 and 2009 can preserve their status by filing returns by Oct. 15, 2010, under a one-time relief program, the Internal Revenue Service announced today. The IRS today posted on a special page of IRS.gov the names and last-known addresses of these at-risk organizations, along with guidance about how to come back into compliance. The organizations on the list have return due dates between May 17 and Oct. 15, 2010, but the IRS has no record that they filed the required returns for any of the past three years. “We are doing everything we can to help organizations comply with the law and keep their valuable tax exemption,” IRS Commissioner Doug Shulman said. "So if you do not have your filings up to date, now’s the time to take action and get back on track." Read more... Legal Resource Website for Nonprofits June 14, 2010 - LawForChange™ is a legal resource for the U.S. social sector which includes social entrepreneurs and innovators, social enterprises, charities, community organizations, philanthropies, faith-based organizations and all manner of nonprofit organizations. Within their resources you can search by state to get specific information about your location. Learn more... Did You Miss the IRS Deadline? What Now? May 18, 2010 - If your organization has not filed the form 990 with the IRS in the past three years and missed the May 17th deadline to file, your tax-exempt status has been revoked. In order to reinstate your tax-exempt status, you will be required to file Form 1023 or Form 1024 and pay the appropriate user fee. Learn more... UPDATED: May 19, 2010 - IRS Commissioner Doug Shulman made the following statement about the automatic revocation of tax-exempt status for organizations that failed to meet the May 17 deadline: "Now that the May 17 filing deadline has passed, it appears that many small tax-exempt organizations have not filed the required information return in time. These organizations are vital to communities across the United States, and I understand their concerns about possibly losing their tax-exempt status. The IRS has conducted an unprecedented outreach effort in the tax-exempt sector on the2006 law’s new filing requirements, but many of these smaller organizations are just now learning of the May 17 deadline. I want to reassure these small organizations that the IRS will do what it can to help them avoid losing their tax-exempt status. The IRS will be providing additional guidance in the near future on how it will help these organizations maintain their important tax-exempt status — even if they missed the May 17 deadline. The guidance will offer relief to these small organizations and provide them with the opportunity to keep their critical tax-exempt status intact. So I urge these organizations to go ahead and file — even though the May 17 deadline has passed." Filing a tax return for the small organizations is easier than you’d think. It just takes a few minutes to fill out the electronic notice Form 990-N (e-Postcard). This is available for small tax-exempt organizations with annual receipts of $25,000 or less. SPECIAL ALERT: Is your nonprofit about to lose its tax-exempt status? Check the list and File Online Today May 7, 2010 - More than 1500 registered nonprofits in New Hampshire are at risk of losing their tax-exempt status on May 15. Will your nonprofit be one of them? If you are not sure you can check a list to find out if you need to file. It’s easy. The National Council of Nonprofits wants everyone to know about theNational Center for Charitable Statistics' 4-step tool to find out if you need to file. Go to the NCCS website Select “New Hampshire” and then enter your nonprofit’s name. If you see "FILE NOW" by your nonprofit’s name, and you have not filed a Form 990 in 2010, then you will need to file a Form 990 by May 15, or your nonprofit’s tax-exempt status will be in danger. The ePostcard is easy to complete. It only takes only a few minutes to fill out eight simple questions. Learn more... Revised “Equal Employment Opportunity is the Law” Poster Available EEOC has revised its “Equal Employment Opportunity is the Law” poster. This new version reflects current federal employment discrimination law (including the Americans with Disabilities Act Amendments Act of 2008). The poster was revised to add information about the Genetic Information Nondiscrimination Act of 2008, which is effective November 21, 2009. The revised poster also includes updates from the Department of Labor. Read more... What You Need to Know About the New 990 The Center recently hosted a seminar entitled "What You Need to Know About the New 990" presented by Kelli Boyle, CPA of Nathan Weschler, Connie Boyles Lane, Esq. of Orr and Reno, and Jack M. Zaremba, Esq. of Orr and Reno. They have generously made the PowerPoint presentation from the seminar available for download. View the Presentation... IRS Releases 5-Year Strategic Plan The IRS has released its Strategic Plan for 2009-2013 and they pledge "continued focused oversight of the tax-exempt sector." They propose to provide guidance and information to help nonprofits "understand their responsibilities and comply with the law." They also plan to continue to investigate those who abuse tax-exempt status. Read more... IRS Publishes New Tips for Form 990 Filing The 2008 Form 990 requires reporting of executive compensation by all organizations that file the form. This reporting, contained in Part VII of the core form and Schedule J (required for some organizations), changed significantly from 2007 and prior years. Beginning with 2008 tax years, organizations must report certain compensation information based on amounts reported on Form W-2 (for employees) or Form 1099-MISC (for non-employees). In addition, definitions of persons required to be listed as officers, directors, trustees, key employees, and the five highest compensated employees, changed from prior years. On May 4th, the IRS compiled tips and FAQs relate to core form Part VII and Schedule J executive compensation reporting. IRS Bars Sharing of Webspace Between Charities and 501(c)(4) Political Groups The National Council of Nonprofits reports that the IRS ruled that a local chapter of a national charity violated the prohibition against politicking by including the political-campaign materials of an affiliated 501(c)(4) political advocacy group on its website, even though the materials appeared on discrete pages and the political advocacy group paid all associated costs. Read more... Half a Million Nonprofits Could Lose Their Tax Exemption Did you know that in May 2010, half a million nonprofits could find themselves stripped of their exempt status? The IRS estimates that that's the number of smaller organizations that have failed to file a Form 990-N. The Pension Protection Act of 2006 requires exempt organizations that don't meet the income thresholds for Form 990 or 990-EZ to file a new return with the IRS. The IRS created Form 990-N for this purpose, and smaller nonprofits began using it last year to report on tax years ending on or after December 31, 2007. Learn more... IRS Releases Final Version of New Informational Tax Return The Internal Revenue Service has released the final Form 990 and related schedules, more than 18 months after the first draft of the revised federal financial-disclosures forms were submitted for public comment. Read more... New Online Courses at StayExempt.org StayExempt.org, the web-based version of the popular Exempt Organization workshops, has added new mini-courses on the redesigned IRS Form 990 to the online materials already available.There are five mini-courses discussing aspects of the redesigned annual return (Form 990) for exempt organizations. The new mini-courses about the redesigned annual return (Form 990) include: Preparing to File the New Form 990: An overview of the changes to the form, and tips on getting ready to file it. The Redesigned Form 990 - Part I: General instructions for completing the form and walk through of the heading and financial sections. The Redesigned Form 990 - Part II: Walk through of the accomplishments, compliance, and compensation sections. The Redesigned Form 990 - Part III: Walk through of the governance, management, disclosure, and summary sections; the checklist of required schedules; and Schedule A. The Redesigned Form 990 - Part IV: Walk through of Schedules C, F, G, I, M, and R. Access all the mini-course at stayexempt.org... Elimination of the Advance Ruling Process On September 9, 2008, the IRS issued temporary Income Tax Regulations, which eliminate the advance ruling process for a section 501(c)(3) organization. Under the new regulations, a new 501(c)(3) organization will be classified as a publicly supported charity, and not a private foundation, if it can show that it reasonably can be expected to be publicly supported when it applies for tax-exempt status. Learn more... Employer Alert from the Department of Labor Every employer must offer a check for payment of wages at no cost to the employee with checks on a financial institution convenient to the place of employment where suitable arrangements are made for the cashing of such checks by employees for the full amount of the wages due. Please refer to RSA 275:43 Employers may offer direct deposit and authorized pay cards, at no cost to the employee, as a method of payment, but cannot mandate either of these methods of payments. Any questions, please contact the New Hampshire Department of Labor at: (603)271-0127 or email InspectionDiv@labor.state.nh.us 2008 Form 990-EZ Instructions Released The IRS released revised instructions to the Form 990-EZ, Short Form Return of Organization Exempt From Income Tax, to be used for the 2008 tax year. Form 990-EZ is mostly unchanged; however, it has been updated to include certain schedules from the new Form 990, which replace previously unstructured attachments. A three-page Background Paper - Form 990-EZ provides an overview of the 2008 form, schedules, and instructions. In addition, filing thresholds for Form 990-EZ have been significantly increased for 2008 and later years to allow organizations time to adjust to the new Form 990. Organizations should review the filing thresholds to determine whether they will be eligible to file the Form 990-EZ, or must file the new Form 990, for 2008. Tax-Exempt Properties Get Closer Look This article from the Concord Monitor examines the scrutiny that the City of Concord has been giving properties that receive tax exemptions. Read the Article... IRS Completed 2008 Form 990 Instructions and Background Documents The Internal Revenue Service has completed its revision of the 2008 Form 990 instructions* and posted them, along with three new background documents explaining the new form and instructions. The 2008 Form 990, released by the Internal Revenue Service in December 2007, is effective for 2008 tax years (for returns filed in 2009). Read more... Redesigned Form 990 - Filing Phase In Are you unsure about which 990 series return your organization should file? To allow organizations time to adjust to the redesigned 990 series returns, the IRS will phase in the use of the new Form 990 by organizations based on their financial activity. See the charts on the Charities and Nonprofits Website to find out which form your organization should file during the phase-in period. ACT Cautions IRS Regarding Role in Governance On June 11, 2008 the Advisory Committee on Tax Exempt and Government Entities (ACT) presented recommendations to the IRS TEGE Commissioner related to the role of the IRS in policing good governance issues for nonprofits. The Committe cautioned the IRS that while it may have a legitimate interest in governance issues as they relate to compliance with the laws under its jurisdiction, "effective governance practices will vary depending on numerous factors, including size, sophistication, location, available resources and activities." Read the report... (The governance section starts on page 87) WSJ on Transparency & Accountability This Wall Street Journal article discusses the IRS's efforts to increase transparency in nonprofits from the perspective of the donor who wants to know more about where their money is going, and from the perspective of the nonprofits who are facing increasing scrutiny. Tax Exemptions of Charities Face New Challenges There is a "growing confusion over what constitutes a charity at a time when nonprofit groups look more like businesses, charging fees and selling products and services to raise money, and state and local governments are under financial pressure because of lower tax revenues." Read this New York Times article about issues facing tax exempt organizations today. IRS Provides Guidance on Disclosure Requirements of Form 990-T The IRS has provided interim guidance on the requirement that section 501(c)(3) organizations make available for public inspection Forms 990-T, Exempt Organization Business Income Tax Return. The IRS and Treasury Department invite comments on implementation of the new public inspection requirement, including what schedules or attachments should not be available for public inspection. To find out more, visit: http://www.irs.gov/charities/charitable/article/0,,id=182722,00.html Response to Recent IRS statements Regarding Nonprofit Efficiency and Effectiveness The news that the Internal Revenue Service is stepping up efforts to ensure that charities are effective has elicited angry responses from the nonprofit world. Steven T. Miller, commissioner of the IRS’s tax-exempt division made the comments at a conference on tax-exempt organizations held by the Georgetown University Law Center Continuing Legal Education Department. The Chronicle of Philanthropy has collected some responses to the comments from nonprofit blogs and summarized them. Read more... Read the Chronicle of Philanthropy article on Mr. Miller's comments ... 2006 Pension Law Changes There have been many important changes to retirement planning rules due to the 2006 Pension Protection Act. Donald M. Roy, CFP® of New England Wealth Advisors, our endorsed provider of Retirement Plan Services, is providing The Center members with a valuable resource. The link below provides you with everything you need to know regarding the new law. If you have specific questions after reading the booklet, please feel free to call Don at (603) 429-0968 Online Training from the IRS http://www.stayexempt.org/ Tax-exempt Status

NH Center for Nonprofits
Staying Legal Workshops

The Center offers ongoing training to assist nonprofits to comply with all legal requirements of NH nonprofits. The workshops, held around the state on a regular basis, cover the fundamentals of staying legal in NH as well as addressing emerging issues affecting the regulation of NH nonprofits.
Check our Training Calendar for upcoming Staying Legal Workshops

NH Nonprofit Checklist

A one-page document to be used by nonprofits when applying for grant funding, listing all current legal requirements for NH nonprofits. This is the first time all requirements can be found in one place and is intended to be an educational and user-friendly document for nonprofits of all sizes.
NH Nonprofit Checklist

NH Department of Justice- Division of Charitable Trusts

The Division of Charitable Trusts is responsible for the supervision, administration, and enforcement of charitable trusts, charitable solicitations, and charitable sales promotions in New Hampshire. Their website includes information about laws and regulations affecting NH nonprofits, how to register as a NH nonprofit, and other information important for NH nonprofits.
http://doj.nh.gov/
charitable/index.html

IRS Tax Information for Charities & Other Nonprofits

The IRS has a resource center for charities and other nonprofits with information about how to apply for tax exempt nonprofit status, e-filing for nonprofits, regulations governing charitable donations, and more.
http://www.irs.ustreas.gov/
charities/index.html

NH Center for Nonprofits - 84 Silk Farm Road, Suite 1- Concord, NH 03301 Phone: 603-225-1947 - Fax: 228-5574 - This email address is being protected from spam bots, you need Javascript enabled to view it