- October 19, 2020
What to do, if the IRS rejected Form 990? Remember that when the form is rejected, it is not the end and still you have some options. To know more about it, read on the article. As a first step, you need to examine about Form 990 rejection. It can be due to one of the following options.
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- When you try to file without tax-exempt status, the form will be rejected by the IRS. In order to get the tax-exempt status, you need to file the Form 1023 or Form 1024. Before filing the 990 forms you need to obtain the tax-exempt status from the IRS.
- When you have the tax-exempt status or applied for the tax-exempt status as a 501 (c) (3), the return may be rejected if you select the inappropriate option.
- The IRS will reject the 990 forms if the Form 990 return is filed under an incorrect tax period for your organization. This is one of the most common errors because many organizations believe that they are running the organization on a calendar tax year, though they don’t. If you do not know about the tax year concept contact the IRS.
- The IRS cancels your tax exempt status when your tax exempt organization has not filed the form for consecutive three years. Here, the 990 forms will be rejected, and also you need to refile the Form 1023 or Form 1024.
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So, when the 990 forms are rejected, what is the next step to do? When you filed the 990 forms with us, we will notify when the form was rejected, along with the reasons for rejection so that you can act quickly and correct the required information. After you make the corrections, you can retransmit the form at no cost. What to do, if you have lost your status as a nonprofit? The tax exempt organization needs to apply again in order to have the tax-exempt status reinstated.
What Do If Tax-Exempt Status Is Lost?
You can get it back. In order to get the lost tax exempt status, you need to apply for tax exemption by filing the Form 1023 or Form 1024 or send a letter when you are applying under a different code section, irrespective of whether the organization originally required to apply for an exemption. In the end, you need to pay the applicable user fee.
If you want to reduce the chance of 990 form rejections? Then you need to start e-filing your tax returns through Tax2efile, where the confusing tax process is streamlined.
