June 2010

Governance Check Sheet Required for Audits of Exempt Organizations

Not-for-Profit partner, Brian Whitlock, recently spoke at the Chicago-Kent College of Law Conference on Not-for-Profit Organizations. (Click here to download the conference brochure.)

During the conference, Fred Kluss, Group Manager, Tax Exempt/Government Entities for the IRS stated that IRS agents are now required to complete a Governance Check Sheet for all audits of exempt organizations. Brian had this to say about the new process:

"The Internal Revenue Service periodically selects exempt organizations for compliance audits. IRS Agents are currently being asked by their managers to routinely complete a Governance Check sheet for every exempt organization that they are auditing. The check sheet must be completed by the Agent regardless of whether the return is a Form 990 or a Form 990-EZ. The form asks many of the same questions that are on the newly revised IRS Form 990. The Governance Check sheet helps the IRS to determine how organized and well run the organization might be. The preconception is that a well run organization will be less likely to have compliance problems."

Questions about the new Governance Check Sheet? Contact Brian Whitlock at 312-980-2941 or bwhitlock@BlackmanKallick.com.