Form 2220 Exempt 2023-2024

How does a non-profit maintain tax-exempt status? Annual financial reports must be submitted to the IRS and the California Franchise Tax Board. The Board of Directors should review the Corporation's annual IRS and state filings before submitted. Often, the nonprofit will retain an independent accountant to conduct a review of the organization's financial statements and to issue a report to the Board of Directors, which is a less expensive alternative to obtaining a complete audit. The nonprofit should hire a professional accountant to help implement a fiscal management system, addressing issues such as a dual signature requirement on bank accounts, regular review of monthly statements by the board, and an annual audit. The local chapter of the American Institute of Certified Public Accountants or the California Board of Accountancy's clearinghouse for volunteer accounting services may be contacted for information on accountants who may provide free services or reduced-cost services to nonprofits, pursuant to California Government Code section 12586, referred to as the nonprofit integrity Act of 2004. A charitable organization with gross revenue of two million dollars or more must obtain independent audits and appoint an audit committee. The audited financial statements must be made available for inspection at any time during the existence of the nonprofit organization. The IRS or the California Franchise Tax Board may audit the organization to determine tax liability penalties or revocation of tax-exempt status. Informational returns IRS Form 990 and California FTB Form 199 or 199n public charities must submit annual filings to the IRS, including IRS Form 990 or 990-ez until the return of the organization exempt from income tax and an accompanying schedule a within four and a half months following the close of the organization's tax year. This is the organization's informational return stating its finances and activities. Certain organizations are...