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Exempt Organizations: 2016 Key Areas of Focus

The IRS released its Tax Exempt and Government Entities (TE/GE) Priorities for FY2016. These priorities highlight specific compliance projects the IRS has prioritized during the twelve-month period from July 2015 through June 2016. The three main takeaways are:

1.  The IRS will continue to develop its data-driven decision-making process by identifying areas or issues that may be of greater risk of non-compliance.

a. Through this data-driven process, the IRS will focus on:

i. exemption issues such as non-exempt activities and private inurement,
ii. protection of assets by identifying self-dealing and excess benefit transactions,
iii. identifying employment tax and unrelated business income tax liabilities, and
iv. other issues pertaining to non-exempt charitable trusts and hospitals (Section 501(r)).

2.  Develop a pilot process to analyze data from 1023-EZ applications for trends and   patterns, including post-determination compliance enforcement of organizations that   were granted tax-exempt status through the streamlined determination process.

3.  Use change rate data and statistical sampling in Tax Exempt Bonds to identify market segments with a higher risk of non-compliance.

Windes will announce releases and other developments pertaining to these priorities during the year.

If you have questions regarding your organization’s activities in connection with any of the topics discussed above, please contact Chérie Williams at or toll free at 844.4WINDES (844.494.6337).
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