Part 1 – GOVERNANCE

 

SECTION:  Financial Administration

 

POL 1-020 Pr

Internal Revenue Service reporting requirements

 

Effective date: July 16, 2010

Approval date: July 16, 2010

Last revised:  July 16, 2010

Cancelled date: 

Reference:

Cross reference:

 

 

PROCEDURES

 

1.                To ensure ARMA International does not engage in activities that could jeopardize its tax exempt status, the Association will conduct period reviews of the following areas, at a minimum:

 

(a)   Whether compensation arrangements and benefits are reasonable, based on competent survey information and the result of arm’s length bargaining.

 

(b)   Whether partnerships, joint ventures, and arrangements with management organizations conform to ARMA International’s written policies, are properly recorded, reflect reasonable investment or payment for goods and services, and do not result in inurement, impermissible private benefit or excess benefit transactions. 

 

2.                As provided in the ARMA International group exemption letter issued by the IRS, ARMA International may include only those Regions and Chapters that have authorized ARMA International in writing to include them and have provided all financial information required to be included in the Form 990 group return.  To avoid fines assessed by the IRS, it is imperative that all U.S. Regions and Chapters are included. 

 

3.                The Form 990 will be reviewed and updated by the tax preparers for ARMA International and distributed to all Regions and Chapters in May prior to the end of the fiscal year which is to be reported.

 

4.                This form must be completed regardless of the amount of gross revenue.

 

5.                This form should be completed by the Region or Chapter Treasurer and signed to indicate that it was completed properly.  

 

6.                The Region Manager/Chapter President or another designated chapter officer must review, sign, date and mail the completed Financial Information Form to ARMA Headquarters no later than August 1 each year.  It is imperative that Regions and Chapters not file IRS forms themselves.  Financial information should be submitted to ARMA Headquarters for analysis of data and preparation of returns.

 

7.                The IRS will assess a penalty of $10 per day or a maximum of $5,000 for each Chapter not reported on a Form 990.  A Region or Chapter is then required to file IRS forms on its own and is responsible for any applicable fees.

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Questions about previous Policies & Procedures? Contact Connie Hardy, Corporate Secretary.