New Registration Form for 501(c)(4) Organizations

December 19, 2016Articles Nonprofit Roundup Blog

The IRS recently published long-awaited Form 8976, which allows Code Section 501(c)(4) organizations to register with the IRS. Previously, we discussed Section 506 of the Internal Revenue Code, a newly enacted provision that requires Code Section 501(c)(4) organizations to notify the IRS of their existence within sixty (60) days of their incorporation.

Form 8976 may only be submitted electronically and requires a $50 user fee. The Form 8976 Electronic Notice Registration System allows organizations to complete the notification process and keep account information current. The system also enables Code Section 501(c)(4) organizations to receive secure digital communications from the IRS.

Once the Form 8976 is submitted, the IRS is required to acknowledge that a Code Section 501(c)(4) organization’s notification has been submitted. Generally, if a Code Section 501(c)(4) organization submits a complete and accurate notification, it can expect to receive an acknowledgement from the IRS within 60 days.

If a Code Section 501(c)(4) organization does not submit the notification within 60 days, the IRS will assess a penalty of $20 per day for each day the failure continues (up to a maximum of $5,000). However, organizations that filed a Form 990 (or, if eligible, Form 990-EZ or Form 990-N) or a Form 1024 Application for exemption on or before July 8, 2016 are not required to file the notification.

Code Section 501(c)(4) organizations should keep in mind, however, that the Form 8976 is not a substitute for an annual information return or notices (e.g., Form 990, Form 990-EZ or Form 990-N). Therefore, in addition to submitting the Form 8976 notice, Code Section 501(c)(4) organizations must ensure that they timely file their annual information returns.