Failure to file new IRS form 990-N could lead to loss of exempt status for smaller nonprofits

Nonprofits whose exemptions are revoked will suddenly be required to pay federal income taxes — and subject to financial penalties if they fail to do so. Hundreds of thousands of charities, many operated on shoestrings, could find them themselves no longer eligible to accept tax-deductible contributions. Nonprofits that wish to have their exemptions reinstated will be required to re-apply to the IRS for tax-exempt status, a process that can take several months.