142: Someone Get Me a Flux Capacitor! | What Happens When Your Nonprofit IRS Status is Revoked

Your nonprofit's 501(c)(3) status just got revoked – now what? Don't panic! Your organization still exists, but here's what you need to know.

It's Jess Birken here, and I'm back with co-host Meghan to tackle one of the most common (and scary-sounding) nonprofit disasters: losing your tax-exempt status.

Real Listener Question: "Our 501(c)(3) was revoked last year, and we have a community cleanup event coming up. Can we still do this event? Are we open to more liability?"

We're breaking down the biggest misconception about revoked tax status – your nonprofit doesn't disappear when you lose 501(c)(3) status! Plus, we're calling out "Uncle Larry" (you know, that volunteer who promised to handle your 990s for free) and explaining why delegation doesn't absolve board responsibility.

What You'll Learn:

•  Why nonprofits lose tax-exempt status – the "three strikes" auto-revocation rule
•            What revoked status actually means vs. what people think it means
•            Whether you can continue operations and events without 501(c)(3) status
•            The real liability risks (spoiler: probably not what you think)
•            Why your insurance policies don't automatically change when status is revoked
•            Board responsibility for compliance – delegation isn't abdication
•            How to move forward without beating yourself up over past mistakes

Bottom line: Losing 501(c)(3) status is like changing your tax filing status from "married" to "single" – you still exist, you just need to get your label back. Remember: This happens to small nonprofits all the time. You're not alone, and it's fixable. Focus on moving forward, not beating yourself up.

Resources from this Episode

•           IRS Auto-Revocation Information: https://www.irs.gov/charities-non-profits/automatic-revocation-of-exemption
•           Form 990 Filing Requirements: https://www.irs.gov/charities-non-profits/form-990-resources-and-tools
•           Previous Episode: Can Trump Revoke Harvard's Tax Status? - https://birkenlaw.com/charity-therapy-podcast/ct138/
•           Episode Transcript: https://birkenlaw.com/wp-content/uploads/2025/06/CT142_Transcript.pdf

Connect with Us

•           Jess Birken: https://www.linkedin.com/in/jessbirken/
•            Meghan Heitkamp: https://www.linkedin.com/in/meghan-heitkamp-829254115/

Listen & Engage

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•           Rate & Review on Apple Podcasts: Click "Ratings and Reviews" then "Write a Review"
•           Send us your nonprofit questions: https://birkenlaw.com/podcast/#podcast-story  

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