OUR THOUGHTS ON:

IRS Announces e-file Extension for 990 Filers

Not-for-Profit

By Emily Earley

On December 16, 2011, the Internal Revenue Service announced that tax-exempt organizations with January and February filing due dates will have until March 30, 2012 to file their annual returns.

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 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; therefore, all 990-Ns filed with due dates falling in January or February must be filed.

The extension applies to tax-exempt organizations whose normal filing deadline is either January 17 or February 15, 2012. The extension of time to file applies to all such organizations with affected return filings due during this period, whether or not they are required to file electronically. Ordinarily, these deadlines would apply to organizations with a fiscal year that ended on August 31 or September 30, 2011, respectively. The extension also applies to organizations that already obtained an initial three-month filing extension and now have an extended filing deadline that falls on January 17 or February 2012.

Organizations with a filing due date (or first extended due date) between January 1, 2012 and February 29, 2012 that file their returns by March 30, 2012 will be considered to have timely filed. In the case of an organization with a second extended due date that falls during the suspension period, the organization will have reasonable cause for late filing and will not be subject to late filing penalties if it files by March 30, 2012. The organization should attach a “Reasonable Cause Statement” to its return referencing Notice 2012-4, to avoid receiving a system-generated late filing penalty notice from the IRS. An organization generally required to file electronically that has already obtained two three-month filing extensions may be uncomfortable with taking advantage of the late filing penalty relief provided in the notice. In that circumstance, the organization may file its return on paper.

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This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax related matter.

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© 2018 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

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