IRS' office of Tax Exempt Bonds and the Exempt Organizations Compliance Area have initiated a joint effort to evaluate the policies and procedures used by section 501(c)(3) organizations to ensure post-issuance compliance on tax-exempt debt obligations. The IRS will send compliance check questionnaires to more than 200 exempt organizations with outstanding tax-exempt debt.

The IRS website provides a lot of information on tax exempt bonds.

The IRS is currently conducting a compliance check for community foundations. Recently, we have had a couple community college foundations receive notice of these compliance checks, apparently because they have the word "community" and "foundation" in the name. If your college foundation receives one of these notices, you may answer "No" to question 1, indicate that you are a college foundation, and return to the IRS. You do not need to complete the rest of the questionnaire.

The Department of Treasury and Internal Revenue Service have released the joint 2007-2008 Priority Guidance Plan. The Plan includes a number of projects of particular interest to tax-exempt organizations, and in particular, Higher Education:

• Final regulations on revocation standards for organizations that engage in excess benefit transactions
• Proposed regulations on new requirements for supporting organizations added by the Pension Protection Act of 2006
• Regulations regarding qualified tuition programs under section 529
• Final regulations on excise taxes on prohibited tax shelter transactions and related disclosure requirements
• Final regulations on amended information reporting requirements for qualified intellectual property contributions
• Updates of annual revenue procedures governing issuance of letter rulings and technical advice and providing a schedule of user fees for the Tax Exempt and Government Entities Division.

As promised earlier in the year, the IRS has been busy auditing community colleges. Fringe benefits and employment tax issues have been the main focus. One issue that tripped up a few colleges was meal reimbursements where an overnight stay was not involved. For example, meal expenses reimbursed to an employee that travels to another city for a seminar for a day (no overnight stay) are considered taxable wages to the employee.

Read all about fringe benefits in the fringe benefit guide provided by the office of Federal, State, & Local Governments (FSLG).