Will your exempt organization turn into a pumpkin May 15?

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Most people think of April 15 as the big tax day. However, May 15 may be much worse if you are on the board of a little tax-exempt organization.  On May 15 hundreds of thousands of small tax-exempt organizations will suddenly become taxable corporations, required to file Form 1120 and pay taxes every March.  And it's board members of booster clubs, garden clubs, little leagues and so on that will be held responsible.

Why? Because of a largely-unnoticed provision in a 2006 tax bill. The rule requires all nonprofits to file tax forms. Organizations with incomes under $25,000 had been exempt from filing requirements until their 2007 filings were due.  If an exempt organization fails to file for three straight years, you you are no longer a tax-exempt organization.

So if you are on a board of a luncheon club, civic organization or other local do-good outfit, it's time to make sure that filing has been done. Fortunately it's very easy for little outfits. For small charities -- those with income under $25,000 -- the necessary compliance requires only eight pieces of information, with no detailed financial information, to be entered on online Form 990-N. For larger exempt organizations, the IRS will require a Form 990, 990-EZ, or 990-PF. For calendar year returns, these are due May 15. If you need more time for your 2009 filing, you can get a three-month extension on Form 8868. Special exemptions apply to some religious organizations.