New DOS Filing Requirements for New York Nonprofits
As a result of changes to Executive Law 172-b, effective January 1, 2021, certain organizations registered with the New York State Attorney General are now also required to file documents with the New York Department of State.
There are three different reports the Department of State now requires to be filed based on certain earnings, spending, or donation thresholds during an organization’s fiscal year.
1. Annual Financial Disclosure Reports
Under Executive Law Section 172-b, certain charitable organizations are now required to file an annual financial report with the New York Department of State. This new report requirement will apply to any charitable organizations if they meet these criteria:
- Are registered with the New York Charities Bureau under Article 7-A as an organization that solicits contributions in the state of New York
- Are already filing the Form CHAR500 with the Charities Bureau
- Receive more than $250,000 in gross revenue and support
Organizations that meet these three criteria should be filing with the Department of State the same forms that are filed with the Charities Bureau. The full Form 990 (including Schedule B, where applicable), the CHAR500, and the audited/reviewed financial statements must be filed with the Department of State. The 990 Schedule B that is filed with the state of New York will not be made public.
The report must be filed by the 15th day of the fifth calendar month after the close of the charitable organization’s fiscal year. Currently, it is unclear if there will be an automatic six-month extension under the Department of State as is given by the Charities Bureau. It also is currently unclear how to go about filing an extension. Note that the statute also does not authorize the Department of State to impose any penalties for noncompliance with the filing requirements.
The filing must be completed online. Each filer will need to create a NY.gov account by registering on the website. The fee for this filing will be $25, which currently can only be done via a check in the mail to the Department of State.
There is a bill pending in the New York State Senate, which, if passed, would help organizations avoid this dual filing requirement. Many organizations also have signed a petition to eliminate this filing requirement. The petition can be accessed here.
2. Funding Disclosure Reports
Under Executive Law §172-e, certain §501(c)(3) organizations are required to file funding disclosure reports with the Department of State if they make any in-kind donations exceeding $10,000 to a §501(c)(4) organization. The funding report must include:
- Name and address of the Internal Revenue Code (IRC) §501(c)(4) entity receiving the in-kind donation
- Name and address of those managing the IRC §501(c)(3) entity
- Date of the donation
- Description of the in-kind donation and if any restriction exists to use the donation
This report must be filed within 30 days of the close of the reporting period containing that $10,000 or more donation. Reporting period means the six-month period within a calendar year starting January 1 and ending June 30 or starting July 1 and ending December 31.
This filing also must be done online and is subject to the same mailed-in $25 fee.
3. Financial Disclosure Reports
Under Executive Law §172-f, certain §501(c)(4) organizations are required to file financial disclosure reports with the Department of State if they have made expenditures on covered communications in an aggregate amount or fair market value exceeding $10,000 in a calendar year. The financial disclosure report must include:
- Names of the individuals managing the IRC §501(c)(4) entity
- Detailed description of the communication used
- Amount paid for the communication, date of the payment, and to whom it was paid
- Details of any restricted donations received for the communication
The timing of the report filing, method of the filing, and the filing fees are all the same for this report as with the Funding Disclosure Report.
We will issue new bulletins as any updates to these filings become available. For more information, reach out to your BKD Trusted Advisor™ or submit the Contact Us form below.