Exempt Organizations Advisory - IRS Expedites Review and Approval of Charity Applications
July 9, 2005On September 6, 2005, the IRS released IR-2005-93, as follows:
The Internal Revenue Service will provide an expedited review and approval process for new organizations seeking tax-exempt status in order to provide relief for victims of Hurricane Katrina. However, the agency encourages people to use existing organizations currently working on immediate aid efforts.
New organizations should apply for tax-exempt status by filing IRS Form 1023 and write at the top of the form "Disaster Relief, Hurricane Katrina." The IRS will give such applications expedited attention to ensure they meet legal requirements.
"We want to make sure we do all we can to help new charitable organizations get up and running so they can begin providing the assistance the victims of this terrible disaster so desperately need," said IRS Commissioner Mark W. Everson. "Just as we did after September 11, 2001, we will put these applications at the head of the queue and turn them around promptly."
Use of existing charitable organizations is encouraged because such organizations, including churches, are frequently able to administer relief programs more efficiently than newly formed organizations, because they already have fund-raising and distribution infrastructures in place.
The web site of the Federal Emergency Management Agency (FEMA) and the U.S. Government’s main web portal at FirstGov.gov offer lists of organizations that provide support to victims of Hurricane Katrina.
However, the IRS anticipates new charities will form to address the numerous and more specific needs of the disaster victims. The IRS will continually update its on-line search feature that allows taxpayers to determine if a charity has IRS-approved tax-exempt status.
In addition to Form 1023 for applying for recognition for tax exemption, the IRS also offers Publication 3833, "Disaster Relief: Providing Assistance Through Charitable Organizations," which provides guidance on the application process.
For more information on this topic, please contact Catherine W. Wilkinson or Suzanne Ross McDowell.
The Exempt Organization Advisory is a general summary of the law and is not intended as specific legal advice for any organization.
Internal Revenue Service - Circular 230 Disclosure: As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.
For more information on this topic, please contact the authors or the attorneys with whom you usually work at Steptoe.
Questions and comments about the Exempt Organizations Advisory are always welcome and should be sent to bstone@steptoe.com.
