Holyoke Public Library announced in a press release shared on July 25 that the library’s tax-exempt status has been reinstated by the federal government.
According to the press release, this reinstatement is retroactive to November 2023 and “contributions made to our organization are deductible for federal income tax purposes.” The library lost its tax-exempt status after failing to file required documentation with the IRS for several years in a row.
While the library has continued to exist as a nonprofit during this lapse, the inability to claim tax deductions and adequately fundraise posed a threat for the institution: according to Library Director María Pagán, only 41% of the institution’s funding comes from the city. Gaining back tax-exempt status allows donors to claim tax deductions for their contributions, while also allowing the library to be exempt from federal income tax.
“The financial and legal stability provided by the reinstated status allows the library to focus more on its mission and services rather than financial and regulatory concerns,” Pagán told the Shoestring. “With its tax-exempt status reinstated, the library can engage in long-term financial planning and development efforts with greater confidence and security.”
After the announcement from the federal government in May, Pagán said the library sought legal and financial assistance to get reinstated as quickly as possible. “Our legal team completed and submitted IRS Form 1023, which is an application for recognition of exemption under section 501(c)(3) of the Internal Revenue Code,” Pagán explained. “The Financial team completed past-due 990 Forms. The legal and financial professionals addressed and corrected any past oversights that led to the revocation, such as filing any missing returns and the library paying any penalties.” The library board communicated regularly with the IRS, donors, vendors and the general public during this process to ensure full transparency.
“We are delighted to have our tax-exempt status reinstated,” George Mettey, Board President of the Holyoke Public Library, said in the press release. “This accomplishment, along with the support of our generous donors allows us to continue our important work of providing equal access to library materials, services, facilities, technology, up-to-date resources and programs to meet the educational, informational, social, cultural, and recreational needs for residents of all ages and abilities in the City of Holyoke and surrounding areas.”
“We are committed to maintaining compliance with all IRS requirements and to ensure our tax-exempt status remains in good standing,” Mettey concluded.
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