When do form 990 need to be filed

For more information on backup withholding for missing or incorrect names or taxpayer identification numbers, see Pub. If backup withholding rules didn't apply to the organization because it didn't make a reportable payment to a vendor or provide reportable gaming gambling winnings to a prize winner, then leave line 1c blank. Include on this line the number of the organization's employees not the number of Forms W-2 reported on a Form W-3, Transmittal of Wage and Tax Statements, by both the filing organization and reporting agents of the filing organization, including common paymasters and payroll agents, for the calendar year ending with or within the filing organization's tax year.

Enter if the organization didn't have any employees during the calendar year ending with or within its tax year, or if the organization is filing for a short year and no calendar year ended within its tax year. For more information, see the discussion of employment taxes in Pub. The organization may leave line 2b blank if it didn't report any employees on line 2a. Neither Form T nor Form is a substitute for the other.

Report on Form items of income and expense that are also required to be reported on Form T when the organization is required to file both forms. Answer "Yes" if the organization checked "Yes" on line 3a and filed Form T by the time this Form is filed. At any time during the calendar year ending with or within the organization's tax year , the organization had an interest in, or signature or other authority over, a financial account in a foreign country such as a bank account, securities account, or other financial account ; and.

The accounts weren't with a U. See www. Enter the name of each foreign country in which a foreign account described on line 4a is located. Use Schedule O if more space is needed. Answer "Yes" on line 5a if the organization was party to a prohibited tax shelter transaction as described in section e at any time during the organization's tax year.

A prohibited tax shelter transaction is any listed transaction, within the meaning of section A c 2 , and any prohibited reportable transaction. A prohibited reportable transaction is a confidential transaction within the meaning of Regulations section 1. For more information on prohibited tax shelter transactions, see IRS. An organization that files Form other than a section political organization and that is a party to a prohibited tax shelter transaction must file Form T, Disclosure by Tax-Exempt Entity Regarding Prohibited Tax Shelter Transaction, and may also have to file Form , Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code, and pay an excise tax imposed by section For more information, see the instructions for Forms T and Any fundraising solicitation including solicitation of member dues by or on behalf of any section c or organization that isn't eligible to receive contributions deductible as charitable contributions for federal income tax purposes must include an explicit statement that contributions or gifts to it aren't deductible as charitable contributions.

The statement must be in an easily recognizable format whether the solicitation is made in written or printed form, by television or radio, or by telephone. See section for details. In cases where the failure to make the disclosure is due to intentional disregard of the law, more severe penalties apply. No penalty will be imposed if the failure is due to reasonable cause.

All organizations that qualify under section c to receive contributions that are deductible as charitable contributions for federal income tax purposes such as domestic section c 3 organizations other than organizations that test for public safety should answer "No" on line 6a.

Line 7 is directed only to organizations that can receive deductible charitable contributions under section c. All other organizations should leave lines 7a through 7h blank and go to line 8. See section and Notice , C. If the organization is required to file Form , Donee Information Return, to report information to the IRS and to donors about dispositions of certain donated property made within 3 years after the donor contributed the property, it must answer "Yes" and indicate the number of Forms filed.

If, in connection with a transfer to or for the use of the organization, the organization directly or indirectly pays premiums on any personal benefit contract, or there is an understanding or expectation that any person will directly or indirectly pay such premiums, the organization must report on Form , Information Return for Transfers Associated With Certain Personal Benefit Contracts, the premiums it paid, and the premiums paid by others but treated as paid by the organization.

The organization must report and pay an excise tax, equal to premiums paid, on Form A personal benefit contract is generally any life insurance, annuity, or endowment contract that benefits, directly or indirectly, the transferor, a member of the transferor's family, or any other person designated by the transferor other than an organization described in section c.

Form , Notice of Income From Donated Intellectual Property, must be filed by certain organizations that received a charitable gift of qualified intellectual property that produces net income. The organization should check "Yes" if it provided all required Forms for the year for net income produced by donated qualified intellectual property.

Qualified intellectual property is any patent, copyright other than certain self-created copyrights , trademark, trade name, trade secret, know-how, software other than certain "canned" or "off-the-shelf" software or self-created software , or similar property, or applications or registrations of such property. If the organization didn't receive a contribution of qualified intellectual property, leave line 7g blank.

See the Instructions for Form C for more information. If the organization didn't receive a contribution of a car, boat, airplane, or other vehicle, leave line 7h blank. A sponsoring organization of a donor advised fund must answer "Yes" if any one of its donor advised funds had excess business holdings at any time during the organization's tax year. All other organizations should leave this line blank and go to line 9.

If "Yes," see the instructions for Schedule C of Form to determine whether the organization is subject to the excess business holdings tax under section and is required to file Form For purposes of the excise tax on excess business holdings under section , a donor advised fund is treated as a private foundation. Line 9 is required to be completed by sponsoring organizations maintaining a donor advised fund. All other organizations can leave this line blank and go to line Answer "Yes" if the organization made any taxable distributions under section during the organization's tax year.

Under section , a taxable distribution includes a distribution from a donor advised fund to an individual. A taxable distribution also includes a distribution from a donor advised fund to an estate, partnership, association, company, or corporation unless:.

The distribution is for a charitable purpose for example, a purpose described in section c 2 B , and. The organization exercises expenditure responsibility for the distribution. The above doesn't apply to distributions to any organization described in section b 1 A other than a disqualified supporting organization , defined in section d 4 , to the sponsoring organization of such donor advised fund, or to any other donor advised fund.

Answer "Yes" if the organization made a distribution from a donor advised fund to a donor, donor advisor , or related person during the organization's tax year. Answer lines 10a and 10b only if the organization is exempt under section c 7. A section c 7 organization isn't exempt from income tax if any written policy statement, including the governing instrument and bylaws, allows discrimination on the basis of race, color, or religion.

However, section i allows social clubs to retain their exemption under section c 7 even though their membership is limited in writing to members of a particular religion if the social club:. Is an auxiliary of a fraternal beneficiary society exempt under section c 8 , and. Limits its membership to the members of a particular religion; or the membership limitation is:. A good-faith attempt to further the teachings or principles of that religion, and. Not intended to exclude individuals of a particular race or color.

Enter the amount of initiation fees, capital contributions, and unusual amounts of income included in Part VIII. Statement of Revenue , line 12, Total Revenue , but not included in the definition of gross receipts for section c 7 exemption purposes as discussed in Appendix C. However, if the organization is a college fraternity or sorority that charges membership initiation fees but not annual dues, don't include such initiation fees. Statement of Revenue , line 12, Total Revenue , derived from the general public for use of the organization's facilities, that is, from persons other than members or their spouses, dependents, or guests.

Include the amount entered on line 10b of Form on the club's Form T if required to be filed. Investment income earned by a section c 7 organization isn't tax-exempt income unless set aside for the following purposes: religious, charitable, scientific, literary, educational, or prevention of cruelty to children or animals.

Answer lines 11a and 11b only if the organization is exempt under section c For purposes of section c 12 , the term "gross income" means gross receipts without reduction for any cost of goods sold. Member income doesn't include interest income, gains from asset or security sales, or dividends from another cooperative unless that cooperative is also a member. Members are those individuals or entities that have the right to elect the governing board of the organization, are involved in the operations of the organization, and receive a share of its excess operating revenues.

For example, if an organization is a corporation and it receives an amount that qualifies as a contribution to capital under section , then that amount isn't included in either the numerator or the denominator because it isn't considered to be income for tax purposes. However, the payment must meet the following conditions see Rev.

It must ordinarily be used in or contribute to the production of additional income. Gross income for mutual or cooperative electric companies is figured by excluding any income received or accrued from the following. Any provision or sale of electric energy transmission services or ancillary services if the services are provided on a nondiscriminatory, open access basis under an open access transmission tariff; approved or accepted by the Federal Energy Regulatory Commission FERC or under an independent transmission provider agreement approved or accepted by FERC other than income received or accrued directly or indirectly from a member.

The provision or sale of electric energy distribution services or ancillary services, if the services are provided on a nondiscriminatory, open-access basis to distribute electric energy not owned by the mutual or electric cooperative company:.

To end-users who are served by distribution facilities not owned by the company or any of its members other than income received or accrued directly or indirectly from a member , or. Generated by a generation facility not owned or leased by the company or any of its members and which is directly connected to distribution facilities owned by such company or any of its members other than income received or accrued directly or indirectly from a member. For a mutual or cooperative telephone company, gross income doesn't include amounts received or accrued either from another telephone company for completing long distance calls to or from or between the telephone company's members, from qualified pole rentals, from the sale of display listings in a directory furnished to the telephone company's members, or from prepayment of a loan under section A, section B, or section of the Rural Electrification Act of as in effect on January 1, All organizations that aren't section a 1 trusts are to leave line 12 blank.

If a section a 1 nonexempt charitable trust has no taxable income under subtitle A, its filing of Form can be used to meet its income tax return filing requirement under section Such a trust must, if it answers "Yes" on line 12a, report its tax-exempt interest received or accrued if reporting under the accrual method during the tax year on line 12b.

All references to a section c 3 organization on the Form , schedules, and instructions shall include a section a 1 trust for instance, such a trust must complete Schedule A Form or EZ , unless expressly excepted. If the organization is licensed to issue qualified health plans in more than one state, check "Yes. Report the highest dollar amount of reserves the organization is required to maintain by any of the states in which the organization is licensed to issue qualified health plans.

Report the highest dollar amount of reserves the organization maintains on hand and reports to a state in which the organization is licensed to issue qualified health plans. Answer line 14a "Yes" if the organization received any payments during the year for indoor tanning services.

If the organization filed Form during the year, it should check "Yes" on line 14b. Remuneration paid to a covered employee includes any remuneration paid by a related organization. Line 16 applies to private colleges and universities subject to the excise tax on net investment income under section All other organizations, including state colleges and universities described in the first sentence of section a 2 B , are not subject to this tax, and therefore check the "No" box on line 16, and go to Part VI.

A private college or university will be subject to the excise tax on net investment income under section only if four threshold tests are met. The organization must be an eligible educational institution as defined in section 25A f 2. The organization must have had at least tuition-paying students, based upon a daily average student count, during the preceding tax year.

Use the worksheet below to determine whether the organization meets the last three threshold tests above. Worksheet line 1. To calculate the number of tuition-paying students during the preceding tax year including for purposes of determining the number of students at a particular location , enter the daily average number of full-time equivalent FTE tuition-paying students attending the institution, taking part-time tuition-paying students into account on a full-time student equivalent basis.

If worksheet line 1 is fewer than , the organization is not subject to the section excise tax on net investment income. If worksheet line 1 is or more, continue to line 2.

Worksheet line 2. Enter the number of FTE tuition-paying students included in line 1 who were located in the United States during the preceding tax year and enter it on line 2. Worksheet line 3. Divide line 2 by line 1.

Worksheet line 4. To determine the fair market value of the assets, use any reasonable method as long as such method is consistently used. Under these instructions, the principles of Regulation section Assets held for the production of income or for investment aren't considered to be used directly for charitable functions even though the income from the assets is used for charitable functions.

It is a factual question whether an asset is held for the production of income or for investment rather than used directly by the organization for charitable purposes. For example, an office building used to provide offices for employees engaged in managing endowment funds for the organization isn't considered an asset used for charitable purposes.

Worksheet line 5. Calculate the fair market value of the assets of related organizations as defined below using the fair market value of assets as of the end of the preceding tax year that ends with or within the preceding tax year of the organization. Organizations that control or are controlled by the educational institution;.

Organizations that are controlled by one or more of the same persons who control the educational institution;. Supporting organizations described in section a 3 that support the educational institution during the tax year.

When calculating the fair market value of such assets of a related organization, exclude 1 assets of any related organization to the extent that such assets are taken into account with respect to another educational institution, and 2 unless the related organization is controlled by the educational institution, or unless the related organization is a supporting organization of the educational institution, omit assets that are not intended, or are not available, for the use or benefit of the educational institution.

Worksheet line 6. Add lines 4 and 5. Worksheet line 7. Divide line 6 by the daily average number of FTE students. All organizations must complete Part VI. Use Schedule O Form or EZ to provide required supplemental information as described in this part, and to provide any additional information that the organization considers relevant to this part. Part VI requests information regarding an organization's governing body and management, governance policies, and disclosure practices.

Although federal tax law generally doesn't mandate particular management structures, operational policies, or administrative practices, every organization is required to answer each question in Part VI. For example, all organizations must answer lines 11a and 11b, which ask about the organization's process, if any, it uses to review Form , even though the governing body isn't required by federal tax law to review Form Even though the information on policies and procedures requested in Section B generally isn't required under the Code, the IRS considers such policies and procedures to generally improve tax compliance.

The absence of appropriate policies and procedures can lead to opportunities for excess benefit transactions , inurement, operation for nonexempt purposes, or other activities inconsistent with exempt status.

Whether a particular policy, procedure, or practice should be adopted by an organization depends on the organization's size, type, and culture. Accordingly, it is important that each organization consider the governance policies and practices that are most appropriate for that organization in assuring sound operations and compliance with tax law.

For more governance information relating to charities, see IRS. The governing body is the group of one or more persons authorized under state law to make governance decisions on behalf of the organization and its shareholders or members, if applicable.

The governing body is, generally speaking, the board of directors sometimes referred to as board of trustees of a corporation or association, or the trustee or trustees of a trust sometimes referred to as the board of trustees. Enter the number, as of the end of the organization's tax year, of members of the governing body of the organization with power to vote on all matters that come before the governing body other than when a conflict of interest disqualifies the member from voting.

If members of the governing body don't all have the same voting rights, explain material differences on Schedule O Form or EZ. If the organization's governing body or governing documents delegated authority to act on its behalf to an executive committee or similar committee with broad authority to act on behalf of the governing body, and the committee held such authority at any time during the organization's tax year , describe on Schedule O Form or EZ the composition of the committee, whether any of the committee's members aren't on the governing body, and the scope of the committee's authority.

The organization need not describe on Schedule O Form or EZ delegations of authority that are limited in scope to particular areas or matters, such as delegations to an audit committee, investment committee, or compensation committee of the governing body. A voluntary employees' beneficiary association VEBA is a trust under state law. Bank B is the sole trustee of the trust. In completing line 1a, the VEBA will report one voting member of the governing body.

Enter the number of independent voting members of the governing body as of the end of the organization's tax year. A member of the governing body is considered "independent" only if all four of the following circumstances applied at all times during the organization's tax year. The member wasn't compensated as an officer or other employee of the organization or of a related organization see the Instructions for Schedule R Form except as provided in the religious exception discussed below.

Nor was the member compensated by an unrelated organization or individual for services provided to the filing organization or to a related organization, if such compensation is required to be reported in Part VII, Section A.

Neither the member, nor any family member of the member, was involved in a transaction with the organization whether directly or indirectly through affiliation with another organization that is required to be reported on Schedule L Form or EZ for the organization's tax year.

Neither the member, nor any family member of the member, was involved in a transaction with a taxable or tax-exempt related organization whether directly or indirectly through affiliation with another organization of a type and amount that would be reportable on Schedule L Form or EZ if required to be filed by the related organization.

The independence standard for purposes of Part VI isn't the same as the "absence of conflict of interest" standard for purposes of the rebuttable presumption under Regulations section A member of the governing body isn't considered to lack independence merely because of the following circumstances.

The member is a donor to the organization, regardless of the amount of the contribution. Religious exception: The member has taken a bona fide vow of poverty and either a receives compensation as an agent of a religious order or a section d religious or apostolic organization, but only under circumstances in which the member doesn't receive taxable income see Rev.

The member receives financial benefits from the organization solely in the capacity of being a member of the charitable or other class served by the organization in the exercise of its exempt function, such as being a member of a section c 6 organization, so long as the financial benefits comply with the organization's terms of membership. B is a voting member of the organization's board of directors. D is a voting member of both the organization's governing body and the governing body of C, a related organization.

C was Board Chair of X school during the tax year. X's bylaws designate the following as officer positions: Board Chair, Secretary, and Treasurer. C set the agenda for board of directors meetings, officiated board meetings, coordinated development of board policy and procedure, was an ex-officio member of all committees of the board, conducted weekly staff meetings, and performed teacher and staff evaluations.

X compensated C during the tax year for C's services. This compensation was attributable to C's board and committee activities, and to C's non-director activities involving staff meetings and evaluations. Same facts as in Example 3 , except that the Board Chair position wasn't designated as an officer position under X's bylaws, board resolutions, or state law.

Nevertheless, because X compensated C for non-director activities involving staff meetings and evaluations during the tax year, C is deemed to have received compensation as an employee—not as a governing body member—for those activities. Therefore, C isn't an independent member of the governing body.

Same facts as in Example 3 , except that 1 C conducted only director and committee activities during the tax year; 2 C didn't conduct staff meetings and evaluations; and 3 X compensated C a reasonable amount for C's Board Chair services during the tax year, but didn't provide any other compensation to C in any other capacity.

C's independence as a Board member isn't compromised by receiving compensation from X as a Board member and not as an officer or employee. The organization need not engage in more than a reasonable effort to obtain the necessary information to determine the number of independent voting members of its governing body and can rely on information provided by such members. For instance, the organization can rely on information it obtains in response to a questionnaire sent annually to each member of the governing body that includes the member's name and title, blank lines for the member's signature and signature date, and the pertinent instructions and definitions for line 1b, to determine whether the member is or isn't independent.

Answer "Yes" if any of the organization's current officers , directors , trustees , or key employees , as reported in Part VII, Section A, had a family relationship or business relationship with another of the organization's current officers, directors, trustees, or key employees, as reported in Part VII, Section A, at any time during the organization's tax year.

For each family and business relationship, identify the persons and describe their relationship on Schedule O Form or EZ. It is sufficient to enter "family relationship" or "business relationship" without greater detail. Business relationships between two persons include any of the following.

Such transactions don't include charitable contributions to tax-exempt organizations. Ownership is measured by stock ownership either voting power or value, whichever is greater of a corporation, profits or capital interest in a partnership or limited liability company whichever is greater , membership interest in a nonprofit organization, or beneficial interest in a trust. Ownership includes indirect ownership for example, ownership in an entity that has ownership in the entity in question ; there may be ownership through multiple tiers of entities.

B is an officer of the organization, and C is a member of the organization's governing body. B is C's sister's spouse. The organization must report that B and C have a family relationship. The IRS will postpone the required e-filing of Form EZ for one year, while optional e-filing continues to be available. Although Forms T and will come under the e-filing requirement next year, the IRS will continue to accept these forms on paper pending conversion to electronic format.

The IRS will no longer accept paper Forms reporting on periods after Forms reporting information for periods starting on or after January , will be due electronically by Section organizations.

These include political parties, political action committees and campaign committees of candidates for federal, state or local office. Among other requirements, most tax-exempt political organizations have a requirement to file semiannual, quarterly or monthly reports on Form Note that. Just like if you fail to file your income taxes there are repercussions, if an organization is required to file Form and fails to for three consecutive years, the IRS will automatically revoke tax-exempt status.

Timely submission of Form also can help your nonprofit organization avoid filing additional documents and certain user fees. Collective Responsibilities of Nonprofit Boards. What happens if tax-exempt status is revoked? The best way to be prepared, year after year, is to have updated and applicable policies asked about on the form readily available to be referenced. The rate includes a comprehensive consultation and full review round. Contact me at any time via email or by phone Due date?

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