Mitigating the Income Tax Expense of a Retroactive Revocation for EOS
At times, the IRS can move extremely slowly. That is an unfortunate fact of life for organizations that are either waiting for a determination or under examination. The Service's "deliberate" pace can result in many headaches. For instance, an organization awaiting a determination regarding its tax-exempt status may not be eligible to obtain certain funding or even engage in specific activities. For organizations that are subject to a prolonged examination, the consequences can be far more severe.
While the focus below is on organizations that receive a notice of deficiency after their tax-exempt status is retroactively revoked, the principles discussed apply to all entities that receive a notice of deficiency several years after the close of a tax period, including notices of deficiency that redetermine the amount of unrelated business income tax owed.
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Mitigating the Income Tax Expense of a Retroactive Revocation for EOS