The returns include:
Form 990-series annual information returns (Forms 990, 990-EZ, 990-PF, 990-BL);
Form 990-N, “Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or Form 990-EZ;”
Form 990-T, “Exempt Organization Business Income Tax Return (other than certain trusts);” and
Form 4720, “Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code.”
To help exempt organizations comply with their filing requirements, the IRS has provided a series of pre-recorded online workshops.
By law, organizations that fail to file annual reports for three consecutive years will see their federal tax exemptions automatically revoked as of the due date of the third year they are required to file. The Pension Protection Act of 2006 (PPA) mandates that most tax-exempt organizations file annual Form 990-series information returns or notices with the IRS. The law, which went into effect at the beginning of 2007, also impose
The paper says managers do this by delivering lower performance of 2.9 basis points (bps) for each year from the vintage year. For an investor holding the fund for 50 years, that would mean a 21% reduction in performance.
The researchers Massimo Massa, a professor of banking and finance at nonprofit university INSEAD; Rabih Moussawi, an associate professor of finance at Villanova University; and Andrei Simonov, a professor of finance at Michigan State University also say that TDFs invest in more expensive share classes of underlying funds because TDFs often invest in funds in their own fund family.
“Indeed,” they write, “a longer investment horizon will potentially increase the agency problems, providing the manager with more opportunities to favor his family’s funds at the expense of his own performance.”
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The Pension Protection Act of 2006 single-handedly created target date funds as a global asset class, one which now commands a 20% to 25% share among public and corporate pension plans. In the United States, more than $2.5 trillion is invested in these types of funds by approximately 40 million people.
The Pension Protection Act gives legal protection to plan managers when the participants fail to make a specific choice. In that case, the employee’s contributions go to the age-based “default” option. For this reason, many investors in retirement accounts end up holding these target date funds (TDFs) without paying attention to the direct and indirect costs associated with them. This results in a cumulative return