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Board responsibility of non-profit tax dilemma

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kmsdance

Junior Member
What is the name of your state? Arizona

Basically, I am a former member of the board of directors of a small non-profit company that is currently defunct. The company failed to complete the 2005 and 2006 taxes...a simple 990 form...no employment taxes or anything. As a favor to the director, I helped him complete the '05 taxes, which were 8 months late, and was under the assumption that he would do the '06 taxes, since we had no treasurer, and he was making all of the financial decisions and was the only one with access to the checking account. He did not do them. Since I received the IRS notices at my home, I signed for and accepted a certified letter that states the company owes $5000 in late fees for '05. I then took it upon myself, since no one else was willing or able, to send them a request for abatement.

My Questions are....
In what way or capacity will I be held responsible for this? How does the IRS determine who was responsible for doing the taxes? Will we be audited? Taken to court? What are the steps that they take and in what order? What should I expect? A bill to come to me personally because they have record that I was on the board? Do they usually approve these requests for abatement?
 


LdiJ

Senior Member
What is the name of your state? Arizona

Basically, I am a former member of the board of directors of a small non-profit company that is currently defunct. The company failed to complete the 2005 and 2006 taxes...a simple 990 form...no employment taxes or anything. As a favor to the director, I helped him complete the '05 taxes, which were 8 months late, and was under the assumption that he would do the '06 taxes, since we had no treasurer, and he was making all of the financial decisions and was the only one with access to the checking account. He did not do them. Since I received the IRS notices at my home, I signed for and accepted a certified letter that states the company owes $5000 in late fees for '05. I then took it upon myself, since no one else was willing or able, to send them a request for abatement.

My Questions are....
In what way or capacity will I be held responsible for this? How does the IRS determine who was responsible for doing the taxes? Will we be audited? Taken to court? What are the steps that they take and in what order? What should I expect? A bill to come to me personally because they have record that I was on the board? Do they usually approve these requests for abatement?
Well....I wouldn't have taken on that responsibility, nor would I have allowed my address to be used on the 990, therefore automatically making it so that notices came to my home. You have made yourself "point man" for the IRS, when you don't actually have any authority to make anything happen. The IRS could very well try to hold you responsible.

I also can't see how a late 2005 990 could result in 5k worth of penalties and interest.

You need to take the director of the organization by the scruff of his neck and the two of you need to go see a tax pro with experience with 990s.
 

kmsdance

Junior Member
What I don't need is for someone to tell me how I already messed up by allowing them to use my address...I know that...

The tax form was 9 months late @ $20 a day.

What I would like is someone with experience in this field to tell me what to expect and to answer my questions above.

Thank you.
 

LdiJ

Senior Member
What I don't need is for someone to tell me how I already messed up by allowing them to use my address...I know that...

The tax form was 9 months late @ $20 a day.

What I would like is someone with experience in this field to tell me what to expect and to answer my questions above.

Thank you.
I HAVE experience in this field and I already gave you the best advice that I can give you. You need the help of a tax pro to straighten this out, and you absolutely need to take the director of the organization with you.
 

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