[Federal Register Volume 74, Number 140 (Thursday, July 23, 2009)]
[Rules and Regulations]
[Pages 36395-36397]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-17478]



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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 74, No. 140 / Thursday, July 23, 2009 / Rules 
and Regulations

[[Page 36395]]



DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 9454]
RIN 1545-BG37


Notification Requirement for Tax-Exempt Entities Not Currently 
Required To File

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations and removal of temporary regulations.

-----------------------------------------------------------------------

SUMMARY: This document contains final regulations as required by 
section 6033(i)(1) describing the time and manner in which certain tax-
exempt organizations not currently required to file an annual 
information return under section 6033(a)(1) are required to submit an 
annual electronic notice including certain information required by 
section 6033(i)(1)(A) through (F). These regulations affect tax-exempt 
organizations whose annual gross receipts are not normally in excess of 
$25,000.

DATES: Effective Date: These regulations are effective on July 23, 
2009.
    Applicability Date: These regulations are applicable to annual 
periods beginning after 2006.

FOR FURTHER INFORMATION CONTACT: Monice Rosenbaum at (202) 622-6070 
(not a toll-free number).

SUPPLEMENTARY INFORMATION: 

Background

    This document contains amendments to the Income Tax Regulations (26 
CFR part 1) under section 6033(i)(1) relating to the notification 
requirement for entities not currently required to file an annual 
information return under section 6033(a)(1). Section 6033(i)(1) was 
added by section 1223(a) of the Pension Protection Act of 2006, Public 
Law 109-208, 120 Stat. 1090 (2006) (PPA 2006), effective for annual 
periods beginning after 2006. Section 6033(i)(1) requires the Treasury 
Secretary to promulgate regulations that describe the time and manner 
in which certain tax-exempt organizations not currently required to 
file an annual information return are to submit an annual electronic 
notification including information set forth in section 6033(i)(1)(A) 
through (F).
    On November 15, 2007, temporary regulations (TD 9366, 2007-52 IRB 
1232) were published in the Federal Register (72 FR 64147) satisfying 
the requirement that the Treasury Secretary promulgate regulations as 
described in the preceding paragraph. Those temporary regulations were 
corrected on November 23, 2007 (72 FR 65667) and December 14, 2007 (72 
FR 71060). A notice of proposed rulemaking (REG-104942-07, 2007-52 IRB 
1264) cross-referencing the temporary regulations was published in the 
Federal Register (72 FR 64174) on November 15, 2007.
    The IRS and the Treasury Department received four written comments 
from the public in response to the proposed and temporary regulations. 
No hearing was requested or held. After consideration of the comments 
received, it was determined that the proposed regulations would be 
finalized without change. Accordingly, the proposed regulations are 
adopted as amended by this Treasury decision and the corresponding 
temporary regulations are removed. The final regulations retain the 
provisions of the proposed and temporary regulations and make minor 
typographical changes.

Explanation of Revisions and Summary of Comments

    One comment pointed out that there is no de minimis rule regarding 
the amount of income an organization receives during the year which 
would exempt it from having to submit an electronic notification. 
Section 6033(i) does not provide a de minimis rule, nor does it provide 
discretionary authority for the IRS and the Treasury Department to 
establish a de minimis exception for reporting under section 
6033(i)(1).
    Another comment objected to the requirement that the notification 
be submitted electronically. The IRS and the Treasury Department note 
that the statute requires that information be submitted electronically, 
and makes no provision for paper notification. However, as stated in 
the preamble to the temporary regulations, if an organization that is 
required to submit an annual electronic notification files a complete 
Form 990, ``Return of Organization Exempt from Income Tax,'' or Form 
990-EZ, ``Short Form Return of Organization Exempt from Income Tax,'' 
the annual notification required under section 6033(i) shall be deemed 
satisfied. The annual notification requirement is not satisfied if the 
Form 990 or Form 990-EZ contains only those items of information that 
would have been required by submitting the notification in electronic 
form.
    One comment asked about the intent of the regulations and the 
application of the requirement to submit electronic notification to 
organizations that are local chapters or clubs of larger organizations. 
The intent of the regulations, which were required by statute, is to 
provide the public with the most accurate information about tax-exempt 
organizations. With respect to organizations that are local chapters or 
clubs of larger organizations, if the organization is a subordinate of 
a parent organization and the subordinate is included on the parent's 
group return, the subordinate need not submit the electronic 
notification. However, if an organization is not part of a group return 
and is a separate legal entity that meets the criteria for submitting 
the electronic notification, it must submit Form 990-N, ``Electronic 
Notice (e-Postcard) for Tax-Exempt Organizations Not Required To File 
Form 990 or 990-EZ.''
    Finally, another comment asked about the applicability of the 
electronic notification requirement to Qualified State and Local 
Political Organizations (QSLPOs). QSLPOs are not organizations 
described in section 501(c) that are required to file a return under 
section 6033(a); therefore, the provisions of these final regulations 
do not apply to them. However, QSLPOs may have other reporting 
requirements under section 6033(g).

Special Analyses

    It has been determined that this Treasury decision is not a 
significant regulatory action as defined in Executive Order 12866. 
Therefore, a regulatory assessment is not required. It also has been 
determined that section 553(b) of the Administrative Procedure

[[Page 36396]]

Act (5 U.S.C. chapter 5) does not apply to these regulations.
    It is hereby certified that the collection of information in Sec.  
1.6033-6 will not have a significant economic impact on a substantial 
number of small entities. Accordingly, a regulatory flexibility 
analysis under the Regulatory Flexibility Act (5 U.S.C. 601) is not 
required. The effect of these regulations on small entities flows 
directly from the statute these regulations implement. Section 
6033(i)(1) requires that certain entities submit annual notification, 
in electronic form, setting forth: The legal name of the organization; 
any name under which such organization operates or does business; the 
organization's mailing address and Internet Web site address (if any); 
the organization's taxpayer identification number; the name and address 
of a principal officer; and evidence of the continuing basis for the 
organization's exemption from the filing requirements under section 
6033(a)(1).
    Pursuant to section 7805(f) of the Internal Revenue Code, these 
regulations were submitted to the Chief Counsel for Advocacy of the 
Small Business Administration for comment on their impact on small 
business.

Drafting Information

    The principal author of these regulations is Monice Rosenbaum of 
the Office of Division Counsel/Associate Chief Counsel (Tax Exempt and 
Government Entities). However, other personnel from the IRS and the 
Treasury Department participated in their development.

List of Subjects in 26 CFR Part 1

    Income taxes, Reporting and recordkeeping requirements.

Adoption of Amendments to the Regulations

0
Accordingly, 26 CFR part 1 is amended as follows:

PART 1--INCOME TAXES

0
Paragraph 1. The authority citation for part 1 continues to read in 
part as follows:

    Authority: 26 U.S.C. 7805 * * *
    Section 1.6033-6 also issued under 26 U.S.C. 6033(i)(1). * * *


0
Par. 2. Section 1.6033-6 is added to read as follows:


Sec.  1.6033-6  Notification requirement for entities not required to 
file an annual information return under section 6033(a)(1) (taxable 
years beginning after December 31, 2006).

    (a) In general. Except as otherwise provided in this paragraph, 
every organization exempt from taxation under section 501(a) that is 
not required to file a return described in Sec.  1.6033-2(a)(2), other 
than an organization described in section 401(a) or 501(d), shall 
submit annually, in electronic form, a notification setting forth the 
items described in paragraph (c) of this section and such other 
information as may be prescribed in the instructions and publications 
issued with respect to the notification.
    (b) Organizations not required to submit annual electronic 
notification. (1) An organization exempt from taxation under section 
501(a) that is required to file or files an annual information return 
under section 6033(a)(1) shall not submit an annual electronic 
notification under section 6033(i). This includes the following types 
of organizations:
    (i) Any organization included in a group return for that year under 
Sec.  1.6033-2(d).
    (ii) All private foundations required to file under Sec.  1.6033-
2(a)(2)(i) Form 990-PF, ``Return of Private Foundation or Section 
4947(a)(1) Nonexempt Charitable Trust Treated as a Private 
Foundation.''
    (iii) Section 509(a)(3) supporting organizations required to file 
under Sec.  1.6033-2(a)(2)(i) Form 990, ``Return of Organization Exempt 
From Income Tax,'' or Form 990-EZ, ``Short Form Return of Organization 
Exempt From Income Tax.''
    (iv) A section 501(c)(21) black lung trust required to file under 
Sec.  1.6033-2(a)(2)(i) Form 990-BL, ``Information and Initial Excise 
Tax Return for Black Lung Benefit Trusts and Certain Related Persons.''
    (v) Any organization that is required to file or files an annual 
information return under section 6033(a)(1) on any other form 
prescribed by the Internal Revenue Service for that purpose.
    (2) An organization exempt from taxation under section 501(a) that 
is not required to file a return under section 6033(a)(1) is also not 
required to submit an annual electronic notification under section 
6033(i). This includes the following types of organizations:
    (i) A church, an interchurch organization of local units of a 
church, a convention or association of churches, or an integrated 
auxiliary of a church (as defined in Sec.  1.6033-2(h)).
    (ii) An exclusively religious activity of any religious order.
    (iii) A mission society sponsored by or affiliated with one or more 
churches or church denominations, more than one-half of the activities 
of which society are conducted in, or directed at persons in, foreign 
countries.
    (iv) An educational organization (below college level) described in 
section 170(b)(1)(A)(ii), that has a program of a general academic 
nature, and that is affiliated (within the meaning of Sec.  1.6033-
2(h)(2)) with a church or operated by a religious order.
    (v) A State institution, the income of which is excluded from gross 
income under section 115(a).
    (vi) An organization described in section 501(c)(1).
    (vii) An organization that is a governmental unit or an affiliate 
of a governmental unit exempt from Federal income tax under section 
501(a).
    (3) If an organization exempt from taxation under section 501(a) is 
not described in paragraph (b)(1) or (2) of this section, the 
organization must submit an annual electronic notification. Thus, a 
black lung trust that normally has gross receipts of $25,000 or less is 
not required to file Form 990-BL but is required to submit an annual 
electronic notification. A section 509(a)(3) supporting organization of 
a religious organization that normally has gross receipts of $5,000 or 
less is not required to file Form 990 or Form 990-EZ but is required to 
submit an annual electronic notification.
    (c) Additional notification requirements--(1) In general. Any 
organization described in paragraph (a) of this section shall submit an 
annual electronic notification described in section 6033(i)(1). The 
annual electronic notification shall--
    (i) Be in electronic form; and
    (ii) Set forth--
    (A) The legal name of the organization;
    (B) Any name under which the organization operates or does 
business;
    (C) The organization's mailing address and Internet Web site 
address (if any);
    (D) The organization's taxpayer identification number;
    (E) The name and address of a principal officer;
    (F) Evidence of the continuing basis for the organization's 
exemption from the filing requirements under section 6033(a)(1); and
    (G) Additional information necessary to process the notification.
    (2) The mailing address required by section 6033(i)(1)(C) and 
submitted in the annual electronic notification shall be the 
organization's last known address as provided by Sec.  301.6212-2(a) of 
this chapter. This last known address may be updated as provided under 
Sec.  301.6212-2 of this chapter, or by clear and concise notification. 
The Internal Revenue Service will use this last known address as the 
organization's

[[Page 36397]]

address of record and will direct all mailings to this address.
    (3) By submitting the annual electronic notification described in 
paragraph (c)(1) of this section, an organization acknowledges that it 
is not required to file a return under section 6033(a) because its 
annual gross receipts are not normally in excess of $25,000. In order 
to make this determination, the organization must keep records that 
enable it to calculate its gross receipts. All organizations are 
required to maintain records under section 6001. These records will 
provide evidence of the continuing basis for the organization's 
exemption from the filing requirements under section 6033(a)(1).
    (4) If an organization that is required to submit an annual 
electronic notification files a complete Form 990 or Form 990-EZ, the 
annual electronic notification requirement shall be deemed satisfied. 
The annual electronic notification requirement is not satisfied if the 
Form 990 or Form 990-EZ contains only those items of information that 
would have been required by submitting the notification in electronic 
form. Also, the filing of a complete Form 990 or Form 990-EZ, rather 
than the submission of an annual electronic notification, is the filing 
of a return that starts the period of limitations for assessment under 
section 6501(g)(2).
    (d) No effect on other filing requirements. An organization that is 
relieved from filing an information return under section 6033(a) is 
still subject to the requirements of Sec. Sec.  1.6033-2(i) and (j), 
concerning: notice regarding changes in character, operations, or 
purpose; provision of additional information; duty to file other 
returns of information; and duty to file unrelated business tax 
returns. If an organization is required to file an unrelated business 
tax return, Form 990-T, ``Exempt Organization Business Income Tax 
Return,'' the filing of that return does not relieve the organization 
from the requirement of submitting an annual electronic notification 
under section 6033(i).
    (e) Accounting period for submitting annual electronic 
notification. An annual electronic notification required by this 
section shall be on the basis of the established annual accounting 
period of the organization. If the organization has no established 
accounting period, the annual electronic notification shall be on the 
basis of the calendar year.
    (f) Time and place for submitting annual electronic notification. 
The annual electronic notification required by this section shall be 
submitted on or before the 15th day of the fifth calendar month 
following the close of the period for which the notification is 
required to be submitted. Thus, an organization with an accounting 
period ending December 31, 2007, is required to submit an annual 
electronic notification by May 15, 2008. The notification shall be 
submitted in accordance with instructions and publications, including 
those provided at the Internal Revenue Service Web site for exempt 
organizations.
    (g) Effective/applicability date. These regulations are applicable 
to annual periods beginning after 2006.


Sec.  1.6033-6T  [Removed]

0
Par. 3. Section 1.6033-6T is removed.

    Approved: July 15, 2009.
Linda E. Stiff,
Deputy Commissioner for Services and Enforcement.
Michael Mundaca,
Acting Assistant Secretary of the Treasury (Tax Policy).
[FR Doc. E9-17478 Filed 7-22-09; 8:45 am]
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