By Eitan Balloul, Tax Manager, Not-for-Profit

Effective January 1, 2021, many Exempt organizations that file Form NY CHAR500 with the Attorney General must file the same information with the New York Department of State (“DOS”). 

There are 3 different potential reports for filing with the Department of State: 

1. Annual Financial Disclosure Reports – Under Executive Law Section 172-b (1), (2) & (9) 

Charitable organizations that receive more than $250,000 in gross revenue and support in a fiscal year must file annual financial reports with the DOS. The type of financial statements needed depends on the organization’s total annual revenue and support. Beginning July 1, 2021, these thresholds will be as follows: 

• Between $250,000 and $1,000,000, Reviewed financial statements 
• Over $1,000,000, Audited financial statements 

Since the agencies do not share information, organizations can expect to submit: 

• A separate Form CHAR500 containing the same information. 
• Form 990 and all required schedules for the most recently completed tax year. 
• Audited/Reviewed financial statements for the most recently completed tax year. 
• Separate, applicable filing fees. (DOS filing fee is $25 for each report for all organizations) 

2. Funding Disclosure Reports – Under Executive Law Section 172-e 

501(c)(3)’s are required to file funding disclosure reports with the DOS. These reports identify the financial support a 501(c)(3) has given to a 501(c)(4) tax-exempt organization. Only those 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. The in-kind donations will trigger this disclosure requirement only if: the recipient is a 501(c)(4) organization that spends $15,000 or more in a 12-month period on lobbying New York State or county or local governments within the state, and the lobbying expenditures constitute at least 3% of the 501(c)(4)’s total revenues. 

3. Financial Disclosure Reports – Under Executive Law Section 172-f 

501(c)(4)’s are required to file financial disclosure reports with the DOS. These reports identify a 501(c)(4) organization’s issue-based advocacy spending (“covered communications”). Only those 501(c)(4) organizations that have made expenditures on covered communications in an aggregate amount or fair market value exceeding $10,000 in a calendar year are required to file a financial disclosure report with the DOS.

The report will include the names of everyone exerting operational control over the organization, a description of the covered communications, the amount paid for the communication and who received the payment, and the identity of people or entities contributing funding to support the covered communication. 

Filing due dates:  

• Annual Financial Reports must be filed with the DOS on or before the 15th day of the 5th calendar month after the close of the charitable organization’s fiscal year. 
• Funding Disclosure Reports and Financial Disclosure Reports must be filed with the DOS within 30 days of the close of a reporting period. “Reporting period” means the 6–month period within a calendar year starting January 1st and ending June 30th or the 6–month period within a calendar year starting July 1st and ending December 31st.  

All reports are to be filed online on the DOS website and filers will need to create a NY.Gov account.