Steve Sims EA llc

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Announcements and Updates

Is your Nonprofit Organization really a Nonprofit? The California Franchise Tax Board may give you an “Activity Check”... no you can’t cash it!

The California Franchise Tax Board periodically reviews the activities of tax-exempt organizations to determine if the organizations' current operations are in compliance with their tax-exempt purpose. In some cases, they will send an Activity Check letter to the organization.

Based on the information provided, if the FTB determines the organization is active and operating, they will notify the organization, and no further action is required. If an entity is no longer active and operating under its tax-exempt purpose, the organization is not entitled to tax-exempt status. Therefore the tax-exempt status may be revoked. Inactive incorporated or qualified organizations are then provided information on how to formally dissolve with the California Secretary of State.

Check out this link:

https://www.ftb.ca.gov/professionals/taxnews/Editions/2017/April.shtml#Article05

steve@stevesimsea.com