Charity and Non-profits Audits

This page explains the IRS audit process for charities and other nonprofit organizations. 

You’ve probably reached this page because your charity or other nonprofit organization received a letter or phone call from IRS Exempt Organizations (EO) Examinations saying it had been selected for a review of its returns. The type of review is one of the following:

• Audits. The IRS conducts two types of audits:
   
  • Field audit (or examination): If the initial contact letter sets up an appointment for an IRS agent to visit the organization’s premises, the IRS is conducting a field audit.
     
  • Office/correspondence audit (or examination): If the letter asks you to deliver documents to an IRS office by mail, the IRS is conducting a correspondence audit.
     
• Non-audits. If the letter indicates the IRS is conducting a compliance check, then you're not being audited.

Note: The IRS also sometimes asks organizations to complete questionnaires to help us better understand how organizations satisfy federal tax law requirements. Neither compliance checks nor compliance check questionnaires are audits.

Organizations are selected for reviews for a variety of reasons, and the scope of the audit or compliance check will vary based on the type of review.

An audit starts with the initial contact and continues until a closing letter is issued. A compliance check or compliance check questionnaire starts with the initial contact. The IRS may contact the organization again if the IRS needs further information, or if the organization does not respond to the compliance check or questionnaire. The IRS typically issues a closing letter at the end of a compliance check, but not at the end of a compliance check questionnaire.

• Initial contact and letter
• Review of requested items

Taxpayer rights

• Taxpayer rights and Publication 1, Your Rights as a Taxpayer
• Right to representation and Form 2848
• Appeal rights and procedures
• Taxpayer Bill of Rights

Additional information - charity and nonprofit audits

• Annual EO returns, notices and schedules
• Church audits
• Closing agreements
• Employment tax audits
• Fast Track settlement procedures
• Political and legislative activities

Additional information - IRS Exempt Organizations

• Automatic revocation of exemption
• Tax Exempt Organization Search
• Stay Exempt - Interactive Training for Charities

Other IRS-wide considerations

• Third party contacts
• Audits of individuals and businesses