FAQs: Form 990

   1.  Who has to file Form 990?

  • Private Foundations.  They have to file a Form 990-PF.
  • Larger nonprofits that have gross receipts of more than $25,000 have to file Form 990 or 990-EZ.
  • Small nonprofits with gross receipts of $25,000 or less must file the new electronic 990-N (e-Postcard) in order to maintain their tax-exempt status.
  • Organizations that are tax-exempt under section 501(c),  527, or 4947(a)(1) of the U.S. tax code, and that do not fall into the exemptions listed below.

2.  What organizations are exempt from filing Form 990?

  • Faith based organizations
  • Subsidiaries of other nonprofits
  • Nonprofits not in the system yet.  If you are a nonprofit in your state but haven't applied to the IRS for exemption from federal income tax, you don't have to file a Form 990.
  • Religious schools
  • Missions or missionary organizations
  • State institutions.  Some state institutions  are exempt because  they provide essential services ( a university is an example).
  • Government corporations

3.  When do we file the 990?

  • You must file your 990, 990-EZ, 990-N, or 990-PF by the 15th  day of the 5th month after your accounting period ends.  So, if your fiscal year ends December 31, the 990  is due on  May 15 the following year.

4.  Which form of the 990 do we file?

  • Form 990, 990-EZ, and  990-N are filed by tax-exempt organizations, noncharitable trusts, and some types of exempt political organizations. New rules are being phased in, so consult this IRS threshold chart to find out which form to file.
  • Form 990 -PF is filed by all private foundations

5.  If I want to see the 990 of a  particular nonprofit, how do I do it?

  • You can get a copy  of a nonprofit's 990 from the IRS, but you can also view it at the charity you are interested in.  Nonprofit organizations are required  to make their 990  and their exemption application available to the public for inspection at their regional and district offices during regular business hours.
  • Many nonprofits make 990s available for viewing on their websites.

6.  Why did the IRS redesign the form?

  • Form 990 has not been significantly revised since 1979, and its universally  regarded as needing major revisions.  It has failed  to keep pace with changes in the law  and with the increasing size, diversity, and complexity  of tax-exempt sector.  As a result,  the current form fails  to meet the Internal Revenue Service's compliance interests and the transparency and accountability needs of the states,  the general public, and local communities served by the organization.

7.  How does an organization know which portions of the form or schedules it must complete?

  • Each organization  that files the new form must complete all portions of the core form (Parts I through XI), and provide certain narrative responses on Schedule O.  By completing Part IV, Checklist of Required Schedules, the organization will be able to determine which additional schedules, if any, it must complete. 

8.  What are the most significant changes to the 2007 form?

  • The new form is a significiant redesign in format  and content compared to the 2007 form. Major changes include a front page summary that provides  a snapshot of key finanical and operating information, a governance section, and a revised compensation and related organization reporting.  In order to increase reporting compliance, the new form replaces existing "unstructured attachments" with formal schedules.  Other schedules  were added for reporting of foreign activities, non-cash distributions, hospitals, and tax-exempt bonds, to collect information not required  by the current form. 

9.  Why does the new form contain a section on governance?

  • The new form requires each filing organization to provide certain information regarding the compositions of its board or governing body, certain of tis governance policies and practices, and the means by which it is held accountable to the public by making  governance and financial information publicly available.  Many of the questions requrest information or practices or polices that are not required by federal tax law.  However, good governance and accountability practices provide safegards to help ensure that the organization's  assets will be used consistently with its exempt purposes.  This is a critical tax compliance consideration, especially for organizations that are subject to private benefit, excess benefit, and private inurement prohibitions.  In addition, well-governend and well-managed organizations are more likely to be transparent with regard to their operations, finances, fundraising practices, and use of assests for exempt and unrelated purposes.