Our treasurer failed to file her first year because she didn't realize she was supposed to file. After a few ulcers it was taken care of, though I don't remeber any penalties.
I would be concerned that your treasurer won't communicate. If you assumed she was filing this whole time and she knew you were thinking that, that is very suspicious to me. Does she have something bigger than not filing to hide? Are you getting audited? Is she bonded? I do think I would want this investigated farther.
Do you NEED to file? The 990 is due only if your gross proceeds exceeded $25,000.
The penalties add up quickly. I believe it's $20 per day for late filings. (Personnally, I'd talk to the IRS anonymously before I started anything official.) You could be talking about a lot of money - and personal liability if you aren't incorporated. You might want to get some professional advice before you move forward.
The folks at the non-profit division of the IRS are wonderful. Very courteous, helpful, little wait time on the 800 number. I'm always happy to refer someone to them.
My experience with the Penalty Division was very different. Callous, disorganized, and providing conflicting information, depending on who you talked to. They've heard it all and they don't care. You are just another case number. (I spend 6 months trying to iron out a penalty due to a clerical error - I forgot to check a box on the form, which then made it look like we filed several months late.) I knew mine would get resolved in our favor, but it was not a pleasant experience.
This isn't going to cause you to lose your 501(c)3 status. Assuming you have enough info to go back and file them retroactively, go ahead and do that. You will be liable for penalties from the IRS, but you can approach that one of two ways. You can either attach a cover note to the past due filings explaining why they were late and asking for relief from the penalties, or you can wait until they contact you with the bill for the penalty and then write a letter. Assuming your state requires you to file a copy of the 990s, go ahead and do that, too--but I wouldn't bother writing a cover letter with it. Most states don't seem to assess any penalties for late filings of those.
If you were also late in filing sales tax or other returns, I'd take the same approach as with the Federal return.
I just found our that our former treasurer didn't file our taxes as we thought she was doing...we now have to go back and file from July 1, 2001 through now...as if that wasn't a big enough "what!?!" she won't return any phone calls or emails regarding the documentation.
Do we call the police? Take her to court?
Any ideas? I am worried that we will lose our 501c3 status.
