Kendra Finn 9 a.m., July 31
Internal Revenue Service suspends Scott Kaplan and Billy Ray Smith's nonprofit Great Friends Foundation
Scott Kaplan and Billy Ray Smith's non-profit, Great Friends Foundation, won't be granting scholarships to any children of military families this year; the non-profit has been placed on suspension by the Internal Revenue Service for failing to file necessary tax forms.
The foundation, started back in 2008 by the radio-jockeys turned UT-TV morning show hosts, was notified in January that their non-profit status had been revoked.
"This organization is not registered with the IRS," reads a summary from non-profit database GuideStar. "This organization's exempt status was automatically revoked by the IRS for failure to file a Form 990, 990-EZ, 990-N, or 990-PF for [three] consecutive years. Further investigation and due diligence are warranted."
A spokesperson for the non-profit says the suspension is just a big mix-up that occurred after the former executive director moved away.
"According to our records and statements from the previous Executive Director prior to her departure, we feel we have done nothing wrong," wrote SuLynn Daughtery in an August 23 email.
Daughtery says the non-profit failed to mail "return receipts" to the Internal Revenue Service. Now, the non-profit has been forced into limbo for the remainder of 2012. Any scholarships granted in previous years will be honored.
Foundation representatives are waiting for their case to be reviewed by a hearing officer but that may take some time. "In July 2012 we were notified that our case may not be reviewed for some time seeing as the [Internal Revenue Service] is extremely backed up."
To show that the suspension was a mistake, the non-profit released the 990 tax forms for 2010 and 2011.
The tax forms show that since launching the foundation, Smith and Kaplan have raised $313,079.
In 2011, the non-profit netted $61,348 in donations and spent $32,250 on scholarships and donations to other non-profits.
"To date we have granted eleven educational scholarships, ranging from $500 one time to $20,000 multi-year scholarships, to truly exceptional young people," writes Daughtery.
The latest tax forms show that the foundation is sitting on $51,148 in reserves. None of that money will be used on additional scholarships until after the non-profit is reinstated.
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