Who files 990s for your organization?


Two weeks from today, May 15th, is the deadline by which most U.S.-based nonprofits need to turn in their Form 990 to the IRS. (The deadline is four months and 15 days after the end of an organization’s fiscal year.)

Larger organizations have procedures in place to get this done, and can get an automatic six-month extension just by filing Form 8868. Smaller organizations have an easier form to file: the “e-postcard” Form 990-N. But they often have a harder time remembering to do it. Do you know who’s taking care of this at your favorite organization?

The stakes

As I wrote a few weeks ago, the consequence of not filing for three years in a row is automatic loss of tax-exempt status. Without tax-exempt status, supporters can’t take a tax deduction for their donations. If you miss three 990s, say goodbye to your nonprofit.

And this happens more than you might think: This year over 435,000 organizations appear on the IRS list as no longer exempt. Only 16,000 have asked the IRS to have tax-exempt status restored, which suggests that most of the revocations involve organizations that had already ceased operation. But if you’re connected to a small organization that is hard at work taking care of its mission, you might want to check in to see whether someone is on top of the filing this year.

What to do

For groups with less than $50,000 in annual revenues, here’s how to file online. Larger organizations can file a 990-EZ or full 990 online at the Urban Institute’s website Form990.org. Using the site is free for smaller organizations and inexpensive for larger ones. Filing online results in fewer errors (saving both the filer and the IRS time and trouble) and is much less expensive for the government. Form990.org also offers a way to file Form 8868 when organizations need an extension on their due date. There is no option for an extension for organizations that file Form 990-N.

Here’s hoping we all make it through tax time with ease. Don’t end up “in the soup”!

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Comments (1)

  1. Bill Gray writes:
    May 14, 2012 at 4:14 pm

    Note that the $50K limit for filing an electronic Form 990-N is not just for the year of the return. To qualify, an organization must have had gross receipts that AVERAGED no more than $50K for the reporting year and the two years immediately before it. Special rules apply to new organizations: a new charity can have as much as $75K of receipts in its first year or an average of $60K for its first two years without having to file anything other than a Form 990-N for either year. If a charity received $70K in its first year, $50K in its second year and $40K in its third year, though, it would have to file a 990-EZ rather than the electronic 990-N for its third year because the average of the three years’ receipts exceeded $50K.

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