In June 2011, the IRS published a list of approximately 275,000 organizations that automatically lost their tax-exempt status because of their failure to file required annual returns for three consecutive years.
The IRS issued updates of the Automatic Revocation List on July 25 and August 11, 2011. On July 25, a handful of new names were added to the list, while over 1,700 names were taken off. On August 11, more than 15,000 new names were added to the list, while only a few were taken off. In all, more than 332,000 organizations had their status revoked and a little more than 1,800 have escaped from the list. (It is not clear how many of these have been reinstated.)
No churches were included in the 332,000 because churches are not required (at least, so far) to file Form 990. However, many churches provide gifts and grants to nonprofit organizations. It could be important to determine whether a recipient charity has lost its tax-exempt status.
Dan Busby is a certified public accountant, president of the Evangelical Council for Financial Accountability (ECFA), and the author of the Zondervan Clergy Tax & Financial Guide.