<CORSA Chapters> CORSA Chapters & the Federal IRS

[Allan Lacki]

CORSA Chapters & the Federal IRS

Here's a long story that may interest those of you who are interested in CORSA chapter administration.

Hi!  I'm Al Lacki from the Lehigh Valley Corvair Club of Pennsylvania.  I'm also one of the four Eastern Division Directors from CORSA.  I thought I'd share this story with you.  It concerns the Lehigh Valley club's tax exempt status.

For many years, we kept our money in a no-fee commercial checking account with a local bank.  About a year ago, the bank started to charge fees.  We're a small club and have to watch every penny.  So, to avoid the fees, our treasurer closed the account and went shopping for a new one with a different bank.  

As he made the rounds, he found that all the banks now require a federal tax ID number (EIN) for commercial checking accounts.  So, to get one, we had to establish that we were a commercial entity.  

I visited the Pennsylvania Secretary of State's website and began the process.  I soon found out that the officers of our chapter had already incorporated back in 2001, but nobody had thought much about it since then.  

The folks at the Pennsylvania Secretary of State office said we needed to update our Articles of Incorporation anyway to keep our tax-exempt status with the Commonwealth, so we did it.  And then, having established ourselves in good standing with the State, I applied to the IRS for an EIN.  We got one.  

At that point, we then were able to open a new checking account with a bank that doesn't charge fees.  But at the same time, we became aware that we'd have to submit annual tax filings with the federal IRS, even though our Articles of Incorporation state that we are a non-profit 501(c)(7) social club.

A non-profit social club should be able to file a very short "postcard" filing with the federal IRS every year (even though we have practically no net-income).  The word "postcard" is actually a misnomer.  It's a carry-over from the days when the IRS accepted a short postcard filing via US Postal snail mail.  But now, the so-called postcard filing is done over the internet on the IRS website.  The official name of the filing is Form 990-N, but there really isn't a paper form.  It's an online transaction.

So, I attempted to test it out for our club's treasurer.  I established an account for myself on the IRS website and logged onto the postcard filing web page.  But the web page wouldn't recognize our new EIN number.  So, I could not complete the tax filing.  

After doing considerable research, I found out that I had to call the IRS office and tell them that we want to be considered a tax-exempt social club.  This is actually consistent with some advice I was given by an IRS agent a year or so again, back when we began this whole process.  But since then, two other IRS agents told me we'd have to file a multi-page form along with a $400 check to be considered a tax-exempt social club.  I nearly blew my top, but I figured there had to be a way around this....

Wednesday morning, I spoke to another IRS agent named Mrs. Stevens at 1-877-829-5500.  She said she could make it happen over the phone.  She asked a few questions about the Lehigh Valley Corvair Club and I answered them.  She typed the answers into her computer.  She said it would take about six weeks (!), at which time, "we" could do the online "postcard" filing.  By "we", I mean any of the officers of our club.

When Mrs. Steven typed the information into her computer, she included a note to excuse us for filing late.  The due date for filing is the fifteenth day of the fifth month after our tax-year, which is July 31 for our chapter.  That would be December 15, 2016.  Six weeks from Wednesday would be December 29, so at best, we'd be a couple of weeks late. 

So, on or about December 29, I'll log back on to the IRS website and try again.

Allan Lacki
Lehigh Valley Corvair Club Inc.
Eastern Division Director - Corvair Society of America
redbat01 at verizon.net