By Christina R. Ondrako, CPA, Partner
On January 1, 2021 NYS Executive Law 172-b went into effect. The law required certain organizations registered with the New York State Attorney General to file documents with the New York Department of State in addition to filing form CHAR 500 annually. This law applies to any charity that is registered with the NYS Charities Bureau under section Article 7A as an organization soliciting contributions in New York, files a Char 500 with the Charities Bureau, and reports more than $250,000 in gross revenue and support. Organizations subject to this law are asked to register with the Department of State, pay a $25 filing fee and provide any of the applicable reports. Reports being requested are as follows:
- Annual Financial Disclosure Reports- In most cases this is a full form 990 as filed, including Schedule B.
- Funding Disclosure Reports- Only those IRC Section 501(c)(3) tax exempt organizations that have made an in-kind donation greater than $10,000 during a reporting period are required to file this report.
- Financial Disclosure Reports- Only those IRC Section 501(c)(4) organizations that have made expenditures on covered communications in an aggregate amount or fair market value exceeding ten thousand dollars in a calendar year are required to file.
A Senate bill (S4817A) passed both the Senate and Assembly in June to eliminate this redundant and burdensome filing for tax-exempt organizations and is currently awaiting the Governor’s signature to become law.
If you believe your organization is required to file, see the State’s FAQ page for next steps, including how to register and file, at https://dos.ny.gov/system/files/documents/2021/02/faq-financial-reports-final-draft-for-review-003.pdf. Please note that all filings must take place by management or those charged with governance and can only be done through the NYS Department of State system directly. These are not tax filings.
If after you have reviewed the guidance attached, and have further questions, please contact one of our professionals.
Christina R. Ondrako, CPA is a Partner in the Audit Services Group. She practices in the areas of audit and attest engagements, financial statement preparation, internal control reviews and special agreed upon procedures engagements. Her clients include affordable housing, municipalities, including public school districts, manufacturing, and not-for-profit organizations. Christina has particular expertise in audits of federal assistance and federal grant programs. She can be reached at 315.701.6342 or firstname.lastname@example.org.