Tax Exempt Status Follow-up

Thanks to all of you that responded to what is probably (IMHO) very important to all of us.

I received a comment that this was a hysterical post - I must have raised an eyebrow or two.  That's good.  To find as many organizations on this list is truly sad.  Each of these organizations, not just FOLs, represent individuals that give of their time and money to help others. 

So to follow-up - what would be the consequences of losing your tax-exempt status?  Besides looking bad to your supporters, here's some items to think about:

• All contributions to your FOL organization would not be charitable and the donors would not receive a charitable contribution tax deduction.
• Revenues you recieved may be taxable as you are not a tax-exempt organization but possibly considered a business.
• Book sale revenue may become taxable.
• The organization would have needed to file a tax return of some type and the tax returns may show a tax due.
• These "tax returns" would be late, therefore not only taxes owed, there could be penalities, and interest.
• What about State laws?  Income tax and sales tax?

As you can see, this is a short list of the various situations that your organization could face.  Check the organization list for your state.  See anyone you know?   Reach out and give them a heads up!