IRS to Update Rules for Exempt Organizations Moving to Different States

In its 2016-2017 Priority Guidance Plan, released earlier this week, the Internal Revenue Service (IRS) said that it plans to make it easier for tax-exempt organizations to move from one state to another.

Currently, Revenue Ruling 67-390 says that a nonprofit must “establish its exemption” again when it moves to a new state, but in cases where the individual states involved have established laws explicitly recognizing a newly arrived nonprofit as the same organization that existed in its previous state, the IRS has said a new exemption application is not necessary.

Tax experts believe that an update to Revenue Ruling 67-390 would encourage more states to revise their laws to enable seamless moves by nonprofit organizations throughout the country without requiring new applications for tax exempt status.

Source: BNA Daily Tax Report (subscription required)

Types: Blog
Global Topics: Public Policy
Policy Issues: Tax & Fiscal Policy