Tax Status Verify feature to update 509 level status

The Tax Status Verify feature needs to update at the 509 level, not just for 501(c)(3) because 501(c)(3) is not enough anymore.  Beginning in 2013 the IRS began requiring on the 990-PF that private foundations list the status of the charitable organizations they fund.  This requires the establishment of each grantee's 509 status, because the IRS is very concerned with 509(a)(3) supporting organizations http://www.cof.org/sites/default/files/documents/files/expenditure-responsibilty-chart.pdf.  The IRS requires that beside each grantee the funder list the following codes on their grant list within the 990PF:

NC

Non-charity (not 501(c)(3))

PF

Private nonoperating foundation (Section 509(a))

POF

Private operating foundation (Section 4942(j)(3)) other than an EOF

EOF

Exempt operating foundation (Section 4940(d))

PC

Public charity described in Section 509(a)(1) or (2)

SO-DP

Type I, Type II or Type III functionally integrated supporting organization if a disqualified person of the private foundation controls the supporting organization or a supported organization (Section 509(a)(3) and 4942(g)(4))

SO I

Type I supporting organization (Sections 509(a)(3) and 509(a)(3)(B)(i)) other than an SO-DP

SO II

Type II supporting organization (Sections 509(a)(3) and 509(a)(3)(B)(ii)) other than an SO-DP

SO III FI

Functionally integrated Type III supporting organization (Sections 509(a)(3), 509(a)(3)(B)(iii) and 4943(f)(5)(B)) other than an SO-DP

SO III NFI

Nonfunctionally integrated Type III supporting organization (Sections 509(a)(3), 509(a)(3)(B)(iii) and 4943(f)(5)(B))

TPS

Testing for public safety organization (Section 509(a)(4))

I set up our Tax Status code table to have these classifications as the "code" and the tax status as the "description" so I can run a report for our tax return, but that doesn't work because the "code" cannot be pulled into a report.  However, I may be missing something there.  Currently we have to update the 509 status manually to get this to work and therefore we don't use the Tax Status Verify feature because it doesn't do what we need.

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  • Nov 30 2016
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  • Guest commented
    February 23, 2017 17:00

    I have added 509a1, 509a2, 509a3, and a few others as additional tax status codes. I assign 501c3 to Tax Status 1 and 509a1 (for example) to Tax Status 2. Tax Verify verifies both so I get an update to Tax Status 2.

    However, we use the Schedule of Appropriations and Payments report as the attachment to the IRS Form 990-PF. As described above, we are required to list PC, PF, etc. on that schedule. I have to export the Schedule to Excel and then manually add PC, etc to the form before submitting this for our tax return.

    Maybe it is time to update the Schedule of Appropriations and Payments report?

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