If asked, your tax-exempt organizations must provide same-day access to your application for tax exempt status as well as tax returns for the previous three fiscal years. This is a requirement under Internal Revenue code section 6104. All tax-exempt organizations under section 501(c) or 501(d) are covered. This includes public charities, social welfare organizations, chambers of commerce and social clubs. You must also provide a copy of form 1023 or form 1024, which is the application for tax exempt status.
Applications for tax-exempt status: On form 1023 or form 1024, the organization must disclose all documents and statements filed along with the application. This includes legal briefs, letters or other documents issued by the IRS.
If the organization does not have an application filed prior to July 15, 1987, it is not required to make the material available. If you filed an application after July 15, 1987, you should ask the Internal Revenue Service for a copy so that you can make the information available if requested.
Tax returns: Returns must be available for three years from the date they were due including extensions. Religious organizations that did not have to file an application for recognition of exemption or which are not required to file tax return do not have to provide this information.
Where to disclose: You must make this information available at the principal office of your organization or any regional or district office if you are part of a chain of offices. Your principal office is a site that has three or more paid full-time employee employees paid employees whether full or part-time who’s hours exceed 120 hours a week. You can also designate a local agent within a reasonable distance of your office to provide disclosures. If a person makes a request in person you must normally make copies available, the same day requested. If a person requests copies in writing you must mail copies within 30 days after the request is received or if you require copying costs in advance within 30 days after you receive the fees for copying.
How much to charge: You must request fees within seven days after receiving a written request for disclosures. An organization may charge a reasonable fee, but it must not exceed the amount charged by the IRS for providing copies are as set forth in regulation section 601.702(f)(5)(Iv)(B). Presently the IRS charges a dollar for the first page and $.15 for each page thereafter.
Penalties for refusing disclosure: Finally, if you refuse to disclose, you can be penalized up to $5000 for each wheel for failure to disclose the return or application. There are rules that can help if you believe the disclosure request is part of a harassment campaign.
OUR RECOMMENDATION: You may avoid Risk the requirement of direct disclosure if you make the information “widely available”. Posting on the Internet is considered widely available and would save you the time and expense of providing copies of documents requested. You may still need to provide the web address if requested.
