In 1996 Congress passed a law that requires tax-exempt organizations to provide copies of their last three annual information returns (IRS Form 990) and their application for tax-exempt status (IRS Form 1023) to anyone who asks for copies by mail or in person. Previously, nonprofits only had to make these documents available at their place of business. On April 9, 1999, the IRS issued implementation regulations that became effective on June 8. A summary of the regulations follows.

• Form 1023 and any supporting documents filed by or on behalf of the organization in connection with its application.
• Any letter or document issued by the IRS in connection with the application.
• Annual information returns (such as Form 990, 990-EZ, 990-BL and Form 1065) that have been filed for the previous three years.

• In-person request to review covered documents: The organization must make the documents listed above available free of charge at the organization's principal places of business and regional offices with three or more staff.
• In-person requests for copies: An organization must comply with in-person requests on the same business day unless there are “unusual circumstances” such as when key staff are attending an off-site meeting. In no event may the delay exceed 5 business days. The organization may charge up to $1.00 for the first page and $.15 for each additional page. It may require payment by cash or money order.
• In-writing requests for copies: The organization must respond to requests made in writing, whether by mail, electronic mail, fax or a private delivery service. Copies of the requested documents must be mailed within 30 days from the date the organization receives the request. If the organization requires payment in advance, copies must be sent within 30 days of the date it receives payment. However, within seven days of receiving the request, the organization must notify the requester that it has a prepayment policy and the amount due. The organization must accept payment by certified check, money order, personal check or credit card for requests received in writing. If the organization does not require payment in advance, it must notify the requester and receive consent before providing copies for which the fee will exceed $20.

An organization can avoid the above requirements to provide copies if it makes the covered documents “widely available.” This can be accomplished by posting the documents on the Internet and allowing the general public to access them at no charge. However, the regulations require that the documents be posted in a format that when downloaded, viewed and printed, exactly reproduces the image of the document as it was originally filed. PDF files are acceptable. The actual regulations give more specific details.

Within seven days of receiving a written request for copies, organizations that use the Internet to make their documents widely available must notify requesters how to access the documents. In person requesters must be told the Internet address at the time they appear on site.

Please note that even if the documents are posted on the Internet, an organization must still make them available for inspection on site.

• An organization that “reasonably” believes it is being subjected to a harassment campaign may suspend compliance, but must file for a “harassment campaign determination” within 10 days. The IRS provides that a harassment campaign exists when the relevant facts and circumstances show the purpose of requests is to disrupt the operations of the organization rather than to obtain information.
• An organization may disregard requests for copies in excess of two per month or four per year made by a single individual or sent from a single address. The organization does not have to submit an application for a harassment campaign determination in these situations.

An organization should be cautious in exercising the harassment exception. If the IRS determines that the organization was not “reasonable” in its belief that it was subject to a harassment campaign, it will be subject to the same fines that are applied for failure to comply with the disclosure requirements. The fines will be assessed retroactively to the day the organization suspended compliance.

The penalty is $5,000 per document for each willful failure to respond to a request for the covered documents