IRS determination 200511022: IRS proposes revoking an organization's exemption after records go unprovided

Plain-English summary

The IRS proposed revoking an organization's exemption under IRC § 501(c)(5) because it had not supplied information requested for an examination of its books and records. The report cites a regulation requiring exempt organizations to submit additional information the IRS needs to inquire into their exempt status. The accompanying letter offers an appeal and says it will become final if the organization does not respond within 30 days. The public copy does not show whether the organization appealed.

Ruling snapshot

• Question: Should the organization's exemption be revoked because it did not provide requested examination records?
• Outcome: Proposed revocation, subject to the response and appeal process in the letter.
• Key authorities: IRC § 501(c)(5); Treas. Reg. § 1.6033-2(i)(2).

Full text (IRS public release)

UIL
501.20-00

200511022

DEPARTMENT OF THE TREASURY
Internal Revenue Service
625 Fulton St., 3rd Fl.
Brooklyn, NY 11201

TAX EXEMPT AND
GOVERNMENT ENTITIES
DIVISION

September 21, 2004

Taxpayer Identification Number:
Form:
990

Tax Year(s) Ended:
Person to Contact/ID Number:
Contact Numbers:

CERTIFIED MAIL — RETURN RECEIPT REQUESTED

Dear:

We have enclosed a copy of our report of examination explaining why we believe an adjustment of your organization's exempt status is necessary.

If you do not agree with our position, you may appeal your case. The enclosed Publication 3498, The Examination Process, explains how to appeal an Internal Revenue Service (IRS) decision. Publication 3498 also includes information on your rights as a taxpayer and the IRS collection process.

If you request a conference, we will forward your written statement of protest to the Appeals Office and they will contact you. For your convenience, an envelope is enclosed.

If you and Appeals do not agree on some or all of the issues after your Appeals conference, or if you do not request an Appeals conference, you may file suit in United States Tax Court, the United States Court of Federal Claims, or United States District Court, after satisfying procedural and jurisdictional requirements as described in Publication 3498.

Letter 3610 (04-2002)
Catalog Number 34801V

200511022

You may also request that we refer this matter for technical advice as explained in Publication 892, Exempt Organization Appeal Procedures for Unagreed Issues. If a determination letter is issued to you based on technical advice, no further administrative appeal is available to you within the IRS on the issue that was the subject of the technical advice.

If you accept our findings, please sign and return the enclosed Form 6018, Consent to Proposed Adverse Action. ~~We will then send you a final letter modifying or revoking exempt status.~~ If we do not hear from you within 30 days from the date of this letter, we will process your case on the basis of the recommendations shown in the report of examination and this letter will become final. In that event, you will be required to file Federal income tax returns for the tax period(s) shown above. File these returns with the Ogden Service Center within 60 days from the date of this letter, unless a request for an extension of time is granted. File returns for later tax years with the appropriate service center indicated in the instructions for those returns.

You have the right to contact the office of the Taxpayer Advocate. Taxpayer Advocate assistance is not a substitute for established IRS procedures, such as the formal appeals process. The Taxpayer Advocate cannot reverse a legally correct tax determination, or extend the time fixed by law that you have to file a petition in a United States court. The Taxpayer Advocate can, however, see that a tax matter that may not have been resolved through normal channels gets prompt and proper handling. You may call toll-free 1-877-777-4778 and ask for Taxpayer Advocate Assistance. If you prefer, you may contact your local Taxpayer Advocate at:

If you have any questions, please call the contact person at the telephone number shown in the heading of this letter. If you write, please provide a telephone number and the most convenient time to call if we need to contact you.

Letter 3610 (04-2002)
Catalog Number 34801V

Thank you for your cooperation.

Enclosures:
Publication 892
Publication 3498
Form 6018

Report of Examination
Envelope

200511022

Sincerely,

Betty A. McClernan
Acting Director, EO Examinations

Letter 3610 (04-2002)
Catalog Number 34801V

Form 886A
Department of the Treasury - Internal Revenue Service Explanation of Items Schedule No. or Exhibit Year/Period Ended

Name of Taxpayer

FACTS:

In our letters dated [redacted]

we requested information necessary to conduct an examination of your books and records for the year ended [redacted]. As of this date, we have not received the requested information.

Section 1.6033-2(i)(2) of the Income Tax Regulations provides, in part that every organization which is exempt from tax shall submit such additional information as may be required by the Internal Revenue Service for the purpose of inquiring into its exempt status.

Since you have not provided the requested information, we propose to revoke your organization’s exemption from Federation income tax under section 501(c) (5) of the Internal Revenue Code effective [redacted]. [Redacted] is a taxable entity, you will be required to file the appropriate Federal income tax return.

Form 886-A (Rev. 4-68) Department of the Treasury - Internal Revenue Service Page: -1-