§1223. Notification requirement for entities not currently required to file

Pension Protection Act of 2006

Title XII Provisions Relating to Exempt Organizations

Subtitle B Reforming Exempt Organizations

Part 1 General Reforms

(a) IN GENERAL.-Section 6033 (relating to returns by exempt organizations), as amended by this Act, is amended by redesignating subsection ( i) as subsection ( j) and by inserting after subsection (h) the following new subsection:

"( i) ADDITIONAL NOTIFICATION REQUIREMENTS.-Any organization the gross receipts of which in any taxable year result in such organization being referred to in subsection (a)(3)(A)(ii) or (a)(3)(B)-

"(1) shall furnish annually, in electronic form, and at such time and in such manner as the Secretary may by regulations prescribe, information setting forth-

"(A) the legal name of the organization,

"(B) any name under which such organization operates or does business,

"(C) the organization's mailing address and Internet web site address (if any),

"(D) the organization's taxpayer identification number,

"(E) the name and address of a principal officer, and

"(F) evidence of the continuing basis for the organization's exemption from the filing requirements under subsection (a )(1), and

"(2) upon the termination of the existence of the organization, shall furnish notice of such termination.".

(b) LOSS OF EXEMPT STATUS FOR FAILURE TO FILE RETURN OR NOTICE.-Section 6033 (relating to returns by exempt organizations), as amended by subsection (a), is amended by redesignating subsection ( j) as subsection (k) and by inserting after subsection ( i) the following new subsection:

"(j) LOSS OF EXEMPT STATUS FOR FAILURE TO FILE RETURN OR NOTICE.-

"(1) IN GENERAL.-If an organization described in subsection (a )(1) or ( i) fails to file an annual return or notice required under either subsection for 3 consecutive years, such organization's status as an organization exempt from tax under section 501(a) shall be considered revoked on and after the date set by the Secretary for the filing of the third annual return or notice. The Secretary shall publish and maintain a list of any organization the status of which is so revoked.

"(2) APPLICATION NECESSARY FOR REINSTATEMENT.-Any organization the tax-exempt status of which is revoked under paragraph (1) must apply in order to obtain reinstatement of such status regardless of whether such organization was originally required to make such an application.

"(3) RETROACTIVE REINSTATEMENT IF REASONABLE CAUSE SHOWN FOR FAILURE.-If, upon application for reinstatement of status as an organization exempt from tax under section 501(a), an organization described in paragraph (1) can show to the satisfaction of the Secretary evidence of reasonable cause for the failure described in such paragraph, the organization's exempt status may, in the discretion of the Secretary, be reinstated effective from the date of the revocation under such paragraph.".

(c) NO DECLARATORY JUDGMENT RELIEF.-Section 7428(b) (relating to limitations) is amended by adding at the end the following new paragraph:

"(4) NONAPPLICATION FOR CERTAIN REVOCATIONS.-No action may be brought under this section with respect to any revocation of status described in section 6033( j )(1).".

(d) NO MONETARY PENALTY FOR FAILURE TO NOTIFY.-Section 6652(c )(1) (relating to annual returns under section 6033 or 6012(a)(6)) is amended by adding at the end the following new subparagraph:

"(E) NO PENALTY FOR CERTAIN ANNUAL NOTICES.-This paragraph shall not apply with respect to any notice required under section 6033( i). ".

(e) SECRETARIAL OUTREACH REQUIREMENTS.-

(e)(1) NOTICE REQUIREMENT.-The Secretary of the Treasury shall notify in a timely manner every organization described in section 6033( i) of the Internal Revenue Code of 1986 (as added by this section) of the requirement under such section 6033( i) and of the penalty established under section 6033( j) of such Code-

(e)(1)(A) by mail, in the case of any organization the identity and address of which is included in the list of exempt organizations maintained by the Secretary, and

(e)(1)(B) by Internet or other means of outreach, in the case of any other organization.

(e)(2) LOSS OF STATUS PENALTY FOR FAILURE TO FILE RETURN.-The Secretary of the Treasury shall publicize, in a timely manner in appropriate forms and instructions and through other appropriate means, the penalty established under section 6033( j) of such Code for the failure to file a return under subsection (a)(1) or ( i) of section 6033 of such Code.

(f) EFFECTIVE DATE.- The amendments made by this section shall apply to notices and returns with respect to annual periods beginning after 2006.