Losing Tax-Exempt Status

It is extremely rare for an organization to lose its tax-exempt status. When it happens, it's typically the end result of a three-step process: (1) The IRS conducts an examination of the tax-exempt organization; (2) the IRS issues a letter to the organization proposing revocation; then (3) the organization exhausts all appeal rights.

Review this document to see options and what happens next when an organization's tax-exempt status is revoked.