Walk the handful of specific things that can put your tax-exempt status at risk, so you catch a problem while it is small rather than when it costs you your status.
In Protect Your Tax-Exempt Standing, after the annual return routine is set. For each, mark clear or to review. Anything to review goes to a nonprofit accountant or an attorney.
| Threat | Clear / To review |
|---|---|
| Missing the annual return. Have you filed every year? Repeated failure leads to automatic revocation. | |
| Benefit to insiders. Does any board member, executive, or family receive pay, a contract, a loan, or a benefit? It must be fair, necessary, approved through your conflict-of-interest process, and documented. | |
| Spending that does not serve the mission. Is all significant spending in service of your exempt purpose? | |
| Drift from your exempt purpose. Do your actual activities still match the purpose you were granted? | |
| Taxable income you have not addressed. (The Unrelated Business Income Screen handles it; flag it here.) | |
| Political activity. Have you stayed entirely out of partisan, candidate-related activity, which is not allowed? |
Every to-review item is a professional’s call. An insider-benefit flag especially is a serious exposure; stop and get a nonprofit accountant or an attorney before acting further on it.
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