Filing with the IRS as a Nonprofit
As a nonprofit, IRS filing has unique requirements. Nonprofit organizations in the United States that have achieved tax-exempt 501(c)(3) status are obligated to file IRS Form 990 after every fiscal year. This form is required to provide up-to-date information on the organization’s programs, mission, and finances.
Maxwell Locke & Ritter will spell out the many variations of this form so you might determine which one your organization should submit, if any. Should you have any questions or require assistance with your filing, please reach out to us. Our accounting firm specializes in nonprofit IRS filing requirements and is well-equipped to assist you with your query.
Form 990 Filing Relief During COVID-19
In Notice 2020-23 issued on April 9th, 2020, more tax deadlines were extended by the IRS, nonprofit organizations being among those listed. This broad relief included a variety of tax filings and payment obligations with automatic relief, so taxpayers do not have to file extensions or submit other documentation to the IRS.
The relief also applies to time-sensitive acts listed in Regs. Secs. 301.7508A-1(c)(1)(iv) through (vi) and Rev. Proc. 2018-58.
Some common filings and payment obligations of nonprofit organizations that are included in the list of filings granted relief by this (or previous) notices include:
- Form 990, Return of Organization Exempt from Income Tax
- Form 990-T, Exempt Organization Business Income Tax Return
- Form 990-PF, Return of Private Foundation
- Form 5500, Annual Return/Report of Employee Benefit Plan
You can visit ML&R’s dedicated COVID-19 page for additional information and resources for any important updates on this or other COVID-19 related legislation as it arises.
Exemptions To This Filing Requirement
There are several nonprofit and tax-exempt organizations that do not have to file IRS form 990-N. You should affirm that your organization is not one of these organizations and find the appropriate form instead.
These organizations include:
- Religious and apostolic organizations and their associated auxiliaries
- Organizations that are part of a group return
- Outside tuition programs
- Other organization types that are listed on this IRS page
The Variations of IRS Form 990
There are three major types of IRS form 990: Form 990-N (otherwise known as the e-Postcard), Form 990 EZ, and Form 990 PF.
Form 990-N (e-Postcard)
- Gross receipts normally ≤ $50,000
This is the shortest and simplest of all nonprofit IRS filing types. It has no paper form and must be filed electronically with the IRS.
Even if your organization makes less than $50,000 annually, it may be in your best interest to file form 990-EZ as it provides more information about your organization’s mission. As Form 990 acts as a type of public statement regarding your nonprofit organization, filing a more complete form will provide transparency and help to give you a well-organized reputation. Potential donors and grantmakers often look at a more complete form 990 in order to make donation decisions. Ultimately, the choice is up to you.
Form 990 (Long-Form)
To file the full 990 form with the IRS, nonprofit organizations should have:
- Gross receipts < $200,000, or
- Total assets < $500,000
The form in its entirety must be filed online with an authorized IRS e-file provider for all fiscal years beginning on or after July 1, 2019.
If your nonprofit organization has:
- Gross receipts < $200,000, and
- Total assets < $500,000
then you may choose to file the Form 990 EZ variation instead of the full version.
This version is only two pages and includes all the demographic information included in Form 990-N.
According to the IRS, nonprofit organizations must file Form 990 PF if they are a “private foundation – regardless of financial status”.
A private foundation is defined as “an independent legal entity set up for solely charitable purposes”. This differs from a public charity in that it does not rely on public fundraising for its financial operation. Instead, the charity’s operation usually relies on a single entity for its funding, such as an individual, family, or corporation. Private foundations are not required to hire a diverse board of directors nor are they required to undergo IRS tests in order to maintain their 501(c)(3) status.
Generally, private foundations are formed in order to make grants to public charities. Form 990-PF requires the foundation to file a complete list of grants.
When Should I File My Form 990?
Unlike most typical tax forms, there is no single, set date for every Form 990 to be filed. The filing date is instead dependent on the organization’s fiscal year, the twelve-month period for which the organization plans the use of its funds.
Organizations are required to file their IRS form 990 by the 15th day of the 5th month after the end of its fiscal year. For example, if your nonprofit organization’s fiscal year ends on December 31st, it is then required to file its Form 990 on May 15th of the following year.
In addition, nonprofit organizations may apply for a six-month extension on their due date by filing IRS Form 8868 by the original return due date.
Required Supplementary Schedules to Form 990
In addition to the main form, there are several supplementary schedules you may turn in with your IRS form 990, which you can view in their entirety here.
Failing to submit the required schedules along with Form 990 is a common error, as these schedules are not part of the form itself.
Nonprofit organizations should explore every schedule to determine what is mandatory for you to complete and file along with your 990 form. These schedules are:
|Schedule A||Public Charity Status and Public Support|
|Schedule B||Schedule of Contributors|
|Schedule C||Political Campaign and Lobbying Activities|
|Schedule D||Supplemental Financial Statements|
|Schedule F||Statement of Activities Outside the United States|
|Schedule G||Supplemental Information Regarding Fundraising or Gaming Activities|
|Schedule I||Grants and Other Assistance to Organizations, Governments, and Individuals in the United States|
|Schedule J||Compensation Information|
|Schedule K||Supplemental Information on Tax-Exempt Bonds|
|Schedule L||Transactions With Interested Persons|
|Schedule M||Noncash Contributions|
|Schedule N||Liquidation, Termination, Dissolution, or Significant Disposition of Assets|
|Schedule O||Supplemental Information to Form 990|
|Schedule R||Related Organizations and Unrelated Partnerships|
Trust Maxwell Locke & Ritter With Your Nonprofit Accounting Needs
Our accountants are well-versed in nonprofit IRS filing requirements and can meet a wide range of needs beyond audits and tax services. To discuss how we can best serve you, call our office at 512.370.3200 or contact us online to schedule a consultation. We look forward to working with you.