I can understand your hesitation about this - we were the same way. I spoke candidly to the IRS rep on the phone, also explaining that we didn't necessarily have complete records from the past and that most of the previous officers were no longer associated with the PTO. He told me just to start this year as we were applying for our 501(c)(3) and move forward. Of course, he couldn't guarantee me that we, or anyone, wouldn't be audited, but he indicated the IRS has much bigger fish to fry than going after back filings of a PTO trying to get on the right track with their 501 designation. If the PTO functioned like a PTO normally does, there wouldn't be any back taxes to go after, just a lot of paperwork for everyone.

My suggestion is that you talk to the IRS at their toll free number for exempt organizations. They are very helpful.

Suppose a PTO has been operating for several years and has had financial acitivities (i.e. gross receipts of greater than $25,0000)for several years and has never filed a tax return. Suppose this PTO is just now realizing that it has to be a 501(c)(3) to be legally tax exempt and is working toward getting the 501(c)(3)status. Is this organization going to encounter problems after it files it's first 990 due to the absence of previous years filings?