Effective Date of Tax Exempt Status Mid-Year

[equinecpa]

I volunteer to do a return for a local therapy dog group. The group obtained 501(c)(3) status last year. The effective date of the IRS determination letter is November 12, 2009. The groups fiscal year ends 04/30 and the application was not submitted within 15 months of organization.

Per 990 instructions:

Effective date of exemption. Most organizations described in this chapter that were organized after October 9, 1969, will not be treated as tax exempt unless they apply for recognition of exemption by filing Form 1023. These organizations will not be treated as tax exempt for any period before they file Form 1023, unless they file the form within 15 months from the end of the month in which they were organized. If the organization files the application within this 15-month period, the organization's exemption will be recognized retroactively to the date it was organized. Otherwise, exemption will be recognized only for the period after the IRS receives the application. The date of receipt is the date of the U.S. postmark on the cover in which an exemption application is mailed or, if no postmark appears on the cover, the date the application is stamped as received by the IRS.

I'm understanding this to mean that for the YE 04/30/10 they file an 1120 (this is what they previously filed) and then file a 990 for 04/30/11. Is this correct?