Under a new law, each 501(c)(4) organization will have to notify the IRS of the intent to operate as a 501(c)(4) organization; however, such notice will not be due until at least 60 days after regulations are issued implementing the notification procedures.

As reported in Inside Political Law on December 22, 2015, The Protecting Americans from Tax Hikes Act (PATH Act), added a new provision to the Internal Revenue Code that requires all newly-formed 501(c)(4) organizations to file a notice of registration with the IRS within 60 days of the organization’s formation.  The PATH Act also required certain 501(c)(4) organizations established prior to its enactment to file a notice within 180 days if they had not yet filed an exemption application (Form 1024) or annual information return (Form 990/990-EZ/990-N).

IRS Notice 2016-09 clarifies that organizations need not submit any notification until regulations are issued that implement the notification procedures.  According to Notice 2016-9,  the regulations will provide transitional rules for organizations to comply.  Once the procedure is established, section 501(c)(4) organizations that submit the required notice will receive an acknowledgment of the submission but will not receive a determination letter recognizing tax-exempt status unless a complete Form 1024 is submitted.

Photo of Susan Leahy Susan Leahy

Susan Leahy has advised tax-exempt, nonprofit organizations on tax and corporate governance matters for over 25 years. She assists organizations in obtaining and maintaining tax-exempt status and advises boards and senior executives on a range of governance policies and procedures.

In her work…

Susan Leahy has advised tax-exempt, nonprofit organizations on tax and corporate governance matters for over 25 years. She assists organizations in obtaining and maintaining tax-exempt status and advises boards and senior executives on a range of governance policies and procedures.

In her work with tax-exempt organizations that operate in the United States, as well as internationally, Susan regularly:

  • Counsels clients on the tax implications involving:
  • Self-dealing, inurement, and impermissible private benefit to individuals and for-profit companies;
  • Lobbying, and political activities;
  • Unrelated business income tax;
  • Excess benefit transactions and compensation of executives;
  • Joint ventures and relationships with for-profit organizations;
  • Mergers of tax-exempt organizations and the acquisition or donation of assets; and
  • Corporate sponsorship.

Advises nonprofit boards of directors, board committees, and management with respect to:

  • Corporate formation and good governance principles;
  • Preparation for board and committee meetings; and
  • Conflicts of interests.
  • Provides guidance on state corporate and tax compliance for nonprofit organizations.

“Susan has been my ‘Go-To’ attorney for adept legal strategy and guidance for over 20 years. Susan skillfully led our organization’s volunteer leadership through a needed transition with compassion and sensitivity. Her legal assistance remains invaluable!” a nonprofit organization client noted.

“I highly value Susan’s expertise, responsiveness, and pragmatism,” said another client. “Her insight and advice have proven invaluable time and time again and remain integral to our ability to operate quickly and nimbly.”

Susan is the past chair of the Exempt Organizations Committee of the District of Columbia Bar and a member of the American Bar Association. Susan received her J.D. from Catholic University of America, Columbus School of Law and a B.B.A. from St. Bonaventure University.

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