September 4, 2009 - Phil Hodgen

IRS Cyber Assistant = professional fees evaporate

The IRS is developing a web-based product called “Cyber Assistant.”  It will allow people to make an application for tax-exempt status for an organization.  Online!


This is amazingly good news for normal people and small nonprofits.  Why?  Because the IRS system for qualifying a nonprofit is currently paper-based with the entirely too OCD/anal-retentive Form 1023 application process.

Meaning it’s too complex for a normal person to consider doing (and you get bonus points if you, dear reader, have actually done a tax-exempt status application yourself), and expensive to hire a lawyer to do the work.

The IRS has just taken a chunk of revenue away from tax practitioners who do these applications, and put the money straight into the pocket of the nonprofit being organized.  This is a Very Good Thing.

It is also a warning call to tax practitioners — if your business depends on doing brain-dead work at high prices, you’re going to be road kill.