How automatic revocation happens
Section 6033(j) of the Internal Revenue Code revokes the exemption of any organization that fails to file a required annual return or notice for three consecutive years. Revocation takes effect on the original filing due date of the third missed return.
The IRS cannot undo a revocation that was proper, and there is no appeal. That is true even for a club that never had to apply for exemption in the first place because it was under $5,000: once revoked, it must apply to be recognized again.
Clubs usually find out from a CP-120A letter, or when a sponsor, bank or school looks them up and finds them on the IRS's published automatic revocation list.
First, check where you stand
- 1.Search the club's name and EIN in the IRS Tax-Exempt Organization Search, including the auto-revocation list.
- 2.Find any CP-120A letter and note its date.
- 3.List each year's filing status for at least the last three years.
- 4.Work out whether the club was eligible for the 990-N or 990-EZ in each of the missed years, using gross receipts and assets.
- 5.Check whether the club has ever been automatically revoked before.
The 15-month clock runs from the later of the CP-120A letter date or the date the club appeared on the revocation list. Write that date down first.
The four reinstatement routes
Revenue Procedure 2014-11 sets out four procedures. Which one fits depends on the club's size in the missed years, whether it was revoked before, and how quickly it applies.
| Route | Who can use it | What it takes |
|---|---|---|
| Streamlined retroactive | Eligible to file 990-EZ or 990-N for all 3 missed years; never auto-revoked before | Form 1023, 1023-EZ, 1024 or 1024-A with the user fee within 15 months; paper 990-EZs marked “Retroactive Reinstatement” for each year a 990-EZ was required (990-N years need no prior-year filing) |
| Retroactive within 15 months | Those who cannot use the streamlined route | Form 1023, 1024 or 1024-A with the fee within 15 months; reasonable-cause statement for at least 1 of the 3 years; paper returns for the missed years and later years |
| Retroactive after 15 months | Those applying after 15 months | Same as above, but reasonable cause for all 3 years |
| Post-mark date | Any organization | Form 1023, 1023-EZ, 1024 or 1024-A with the fee; exemption effective from the post-mark date of the application |
Fees, forms and who signs
The 2026 IRS user fees under Rev. Proc. 2026-5 are $275 for Form 1023-EZ and $600 for Form 1023. The 1023-EZ has its own eligibility worksheet, including gross receipts of not more than $50,000 in each of the past and next three years and assets of not more than $250,000.
The application must be signed by an officer, director or trustee of the club. A representative acting under a power of attorney cannot sign it for you.
Under the retroactive routes, the IRS does not impose the late-filing penalty for the three missed years if the organization is reinstated and files the required paper returns. A reasonable-cause statement describes why the club failed to file, how it discovered the failure, and what it is doing to prevent it happening again.
What revocation means in Massachusetts
Revocation is federal, but it reaches the club's state position too.
- Sales tax: DOR's ST-2 exemption is for 501(c)(3) organizations. Stop using the ST-2 and ST-5 until the position is clear, and get advice.
- Donors: gifts made while the club is not recognized may not be deductible; sponsors often check the IRS list.
- Attorney General: registration and Form PC continue regardless of IRS status. Keep filing, because a lapsed Form PC also stops raffles.
- Records: the club will need several years of books to prepare the application and any paper returns.
How to avoid a second revocation
A reinstated club can be revoked again if it misses three consecutive years starting with the year the IRS approves the application, and a club revoked a second time cannot use the streamlined route. The cure is dull but effective: the 990-series due date on the club calendar, at least two officers who can sign in to file, and a handover checklist that names the filing.
Figures on this page were checked against the IRS and Massachusetts sources listed alongside on 28 Sep 2026. They change — confirm the current amount before relying on one.
General information for owner-led businesses, not advice for your specific situation. Tax and accounting rules change, and how they apply depends on facts particular to your business. Talk to us — or to another qualified professional — before acting on anything here.
