Will 200,000 U.S. Nonprofits Vanish in Two Weeks?

By Flickr Lukas (Creative Commons)

Will hundreds of thousands of nonprofits disappear on May 16? If they do, it won’t be because cigar-shaped spaceships hover over neighborhoods and use tractor beams to haul community-serving organizations off to an alien planet.

But it’s very possible that the IRS list of U.S.-based charitable organizations will shrink by something like that number shortly after May 15 of this year. That’s because the “Pension Protection Act of 2006” included a requirement that every organization on the list file some sort of report every year and, further, that any organization that misses three years in a row must be removed from the list. There are a lot of groups that haven’t been heard from in three years. May 15 is the deadline for filing with the IRS for any organization whose fiscal year ended 12/31/09. Here’s a New York Times report on the situation.

There are several different forms that organizations of different sizes use for filing with the Internal Revenue Service:

  • Nonprofits with less than $25,000 per year in revenues use Form 990-N. This is an “electronic postcard” that asks for just eight items of information. There is no paper version — the 990-N must be filed online. The IRS has a detailed explanation and a link to the webpage for filing the form at http://www.irs.gov/charities/article/0,,id=169250,00.html. There’s also a link on that page that allows searching for any organization so it’s relatively easy to check and see whether an organization of interest is up to date in its filings.
  • Organizations with less $500,000 in revenues and less than $1.25 million in assets for the 2009 tax year can use Form 990-EZ.
  • Larger organizations use Form 990.
  • And private foundations use Form 990-PF.

The National Center for Charitable Statistics (a division of The Urban Institute) offers a tool for electronic filing From 990-EZ or Form 990. Using the tool is free for organizations with less than $100,000 in revenues with a sliding scale of fees starting at $35 for larger groups. There’s an introduction to online filing and a full explanation of the service at http://efile.form990.org/.

The Form 990 is due to the IRS five months and 15 days after the end of the filing organization’s fiscal year. Groups that started a new fiscal year on New Year’s Day should have their report in by May 15. The sky probably won’t be dark with alien spaceships on that day, but a lot of organizations are in line to wake up the next morning with a tiresome problem. If there’s any chance an organization you care about is going to pass that three-years-without-filing mark, now would be a good time to get going on getting the Form ready to file by the due date.

[This blog entry appeared on an older version of Idealist; any broken links are a result of having re-launched our site in Fall 2010.]

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