After a two-and-a-half year wait, the San Francisco Public Press has won tax-exempt status from the Internal Revenue Service, the group said today. While the IRS decision sends a positive signal to backers of nonprofit journalism, other news organizations that have applied for charity status are still awaiting word from the tax agency.
The San Francisco Public Press, a local news Web site and print newspaper, first filed for tax-exempt status in January 2010. Officials from the group and other nonprofit news outlets said they were told their applications were being closely scrutinized because they could set a precedent for journalism groups trying to win charity status.
But the IRS delays posed fundraising challenges for the groups, according to their leaders. The San Francisco Public Press, which was operating as a fiscally sponsored project of another nonprofit, said some donors were uncomfortable financing a group that lacked charity status under Section 501(c)(3) of the Internal Revenue Code.
Michael Stoll, the group’s executive director, said in a statement today that the IRS decision “will allow the Public Press to pursue larger grants and other opportunities restricted to nonprofits with 501(c) status.”
But other nonprofit journalism aspirants, including at least 10 member organizations of the Investigative News Network, a membership group, are still awaiting an IRS verdict.
Steve Beatty, managing editor of The Lens, a news group in New Orleans, say he worries that the IRS inaction is also dissuading some people from starting nonprofit journalism organizations.
His own group filed for charity status in October 2010. Its application is still pending, though Mr. Beatty says he’s optimistic the agency will soon make a positive decision.
“I hope the log jam is breaking,” he said of today’s announcement. “The need is great.”