IRS pulls non-profit status from dozens of groups

DOWNEY - Dozens of Downey organizations and charities are nonprofits no more. At least in the eyes of the Internal Revenue Service.From social clubs and political associations to local churches and charitable foundations, more than 75 community organizations lost their non-profit status this month after allegedly failing to file taxes for three consecutive years. Some of the organizations listed are small charities and clubs, such as the Break-A-Ways Square Dancing Club, the Universal Temple of Yoga and Inner Peace, and Downey Aquatic Boosters, but the list also includes several local affiliates of larger national organizations, like American Legion and women's fraternity Alpha Xi Delta. A few prominent Downey organizations are also mentioned including the Downey-Guadalajara Sister City Corporation, Bernabe Community Center and Lions Club of Downey. According to the IRS, these organizations, along with thousands more nationwide, automatically lost tax-exempt status because they failed to file financial reports since 2008. In 2007, the law changed, and all nonprofits were required to file financial information with the IRS, not just larger ones that bring in $25,000 or more a year. The IRS gave nonprofits three years to file their reports and launched outreach campaigns trying to reach the small nonprofits that may have been unaware of the recent changes. Nonetheless, the IRS revoked the nonprofit status of thousands of charities and organizations across the country this month. Without the non-profit status, money donated to these organizations is no longer tax-deductible and all their income is now subject to tax. According to the IRS, the vast majority of the organizations citied are probably now defunct, but existing organizations who neglected to file may apply for reinstatement. The Patriot reached out to several Downey nonprofits on the list, but none were available to comment.

********** Published: August 25, 2011 - Volume 10 - Issue 19