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Employers (SIMPLE) (for Use With a Designated Financial Institution)
• Form 5329, Additional Taxes Attributable to IRAs, Other Qualied Retirement
Plans, Annuities, Modied Endowment Contracts, and MSAs
• Form 5330, Return of Excise Taxes Related to Employee Benet Plans
Note: For more information on employee plans, visit the Retirement Plans
Community located on the IRS website at www.irs.gov, or call 1-800-TAX FORM,
and ask for Package 5500.
Exempt Organizations
Denitions:
Tax Exempt Organization: A tax exempt organization is a non-prot organization
that is exempt from certain taxes because it is described under Section 501 of the
Internal Revenue Code. Certain organizations are required to apply to the Internal
Revenue Service for a determination letter that grants them formal tax exemption,
while other organizations are treated as tax exempt as long as they are organized
and operated under an applicable section of the Code.
IRC Section 501(c)(3) Organization: This is an organization that is organized and
operated exclusively for one or more of the following purposes: charitable, reli-
gious, educational, scientic, literary, testing for public safety, fostering national or
international amateur sports competition (but only if none of its activities involve
providing athletic facilities or equipment), or the prevention of cruelty to animals.
To qualify, the organization must be a corporation, community chest, fund, unincor-
porated association, or foundation. A trust is a fund or foundation and will qualify.
However, an individual or a partnership will not qualify.
Organizations not required to apply for formal tax exempt status: Some organiza-
tions are treated as tax exempt under IRC Section 501(c)(3) without being required
to le Form 1023, provided they are organized and operated appropriately. These
include:
• Churches, interchurch organizations of local units of a church, conventions or
associations of churches, or integrated auxiliaries of a church, such as a men’s or
women’s organization, religious school, mission society, or youth group.
• Any organization (other than a private foundation) normally having annual gross-
receipts of not more than $5,000.
Contributions to domestic 501(c)(3) organizations, except organizations testing for
public safety, are generally deductible as charitable contributions on the donor’s
federal income tax return.
Private Foundation vs. Public Charity: Most organizations that are exempt from
income tax under IRC Section 501(c)(3) are presumed to be private foundations, un-
less they notify the Internal Revenue Service within a specied period of time that
they are not. In effect, the denition divides organizations into two classes, namely
private foundations and public charities. There is an excise tax on the net investment
income of most domestic private foundations. In addition, there are several other
rules that apply.
See Publication 557 for a chart listing many other categories of exempt organizations.