The Bronx Puerto Rican Day Parade hasn’t filed taxes in several years, turning the nonprofit into a for-profit business.
It means that anyone who has contributed to the group - from individuals to corporations - cannot write it off on their taxes.
BPDP organizers had the parade’s 501(c)3 charity status automatically stripped in June 2011 after IRS officials found the longtime group hadn’t filed taxes since 2006, specifically the mandated 990 forms, according to IRS documents.
The 501(c)3 status allows the general public to donate money and use it as a tax deduction.
With over 300,000 Puerto Ricans in the Bronx, the colorful parade along the Grand Concourse has been one of the borough’s main events, rivaling Manhattan’s Puerto Rican Day Parade. The number of groups have grown from 110 last year to 165 groups this year.
“They’re definitely not a nonprofit anymore,” said Lindsay Nichols, a spokeswoman with Guidestar, a leading nonprofit information provider.
The revocation was part of a nationwide crackdown on nonprofits who failed to file taxes as stated in the Pension Protection Act of 2006.
A 2007 amendment to the law requires nonprofits to file taxes every year. The last filing for BPDP dates back to 2006.
The charity is headed by Francisco Gonzalez, longtime district manager for Soundview’s Community Board 9.
“I have nothing to hide,” Gonzalez told the Bronx Times.
But sources charged that he operates the charity from the community board office.
The parade group’s 2004 and 2006 IRS forms, filed in December 2008, do show Gonzalez’s address as 1967 Turnbull Avenue in Bruckner Plaza, which houses Community Board 9’s offices.
“Someone put that in error,” said Gonzalez, head of the 25-year organization. “That’s never been an address used here. I’ll make sure it’s corrected.”
Rules within the City Charter state public servants can’t pursue “personal and private activities during times when the public service is required to perform services for the City.”
“I’ve had occasions to have meetings here but they’re outside [Community Board 9’s] operational hours,” Gonzalez admitted.
Public servants are also banned from using city-owned resources and supplies for any non-City purpose.
John DeSio, communications director for Borough President Ruben Diaz Jr., is baffled by Gonzalez dodging the taxman.
“I’m not a tax expert, but it seems like it’s something that can get you into a lot of trouble.”
Gonzalez admitted the BPDP hasn’t filed taxes - but because the group is simply shorthanded. The challenge, he said, is finding a volunteer accountant to file the paperwork.
“We’ve been calling and calling the accountant to get back and file the paperwork.”
Gonzalez said the organization hasn’t made a dime from the event - “I sometimes have to go into my pocket.”
He said the parade organization prefers large donors directly funding parade events.
But as Gonzalez and his group work to again qualify for charitable status, large donors such as Bronx Lebanon Hospital can’t claim its contributions as a tax deduction.
Anyone who did will likely pay a penalty, according to Guidestar.
“We were not aware of the problem until recently,” said Gonzalez, “Once we get reinstated, the [corporate sponsors] can claim it again.” The revelation comes as Gonzalez faces a community board shakeup - with Diaz replacing almost half its members - that could remove him from his longtime post as district manager.
Reach reporter David Cruz at 718-742-3383 or email@example.com.David Cruz can be reach via e-mail at DCruz@cnglocal.com or by phone at (718) 742-3383
©2012 Community News Group