I would try to rectify what you have. Dissolving this organization and starting over is not the solution. The IRS may not grant you tax exemption due to you turning your back on your debt/findings and trying to avoid it by creating a new identity.

Do the best you can to straighten it out and go forward.

The IRS only goes by the figures you send them. If you send nothing, they assume your organization made less than $25K.

If your records are "a mess", how can you be sure of anything? I would simply worry about this year and not stir up potential issues from years past.

Call the IRS and talk it over with them. You might be subject to some fines, or maybe not. But the sooner you find out, the better. You can probably start the conversation anonymously so you're not tipping your hand immediately. Good luck. Report back here so others can learn, please!

Saw your post yesterday and just didn't know how to reply. Sound like you walked into a heck of a mess.

I'd read up on IRS and state rules governing amounts earned. You also need to go through the record you have to see it they correspond to the 990.

If there is something wrong, when you've reasonably been through all the records, get another set of eyes on your analysis, then, you probably ought to seek the advice of the govt's. Otherwise you'll also appear to be covering something up. That's the last thing you want.

I'm a new treasurer on a completely new board. The records we have are a mess. The 990 for 2006 was filed stating we were under the $25k erroneously and the IRS knows it (prior years filed show $85k+ p/year). 2007 is due next week (filing for extension obviously). What responsibility do we have to correct the mistakes of the previous board? What do we tell the parents? Can we dissolve the PTO and start a new organization? Some of the records we do have are suspicious but how much time and money should we invest in chasing the past?