Filing a 990 series return can be quite a task. It’s a necessary evil in order for nonprofits to keep their tax-exempt status. 990 returns allow both the IRS and the general public to learn more about your organization’s financial status, activities, and program service accomplishments.
If you are required to file a 990 return for your non-profit organization, you should keep the following key steps in mind.
Identify the correct 990 form for your organization
The 990 series is comprised of multiple form variants. The form you file will depend on your organization’s function and finances.
- Form 990-N: Intended for organizations with gross receipts of $50,000 or less
- Form 990-EZ: Intended for organizations with gross receipts greater than $50,000 but less than $200,000 and assets less than $500,000
- Form 990: Intended for organizations with gross receipts of $200,000 or more (or) assets $500,000 or more.
- Form 990-PF: Intended for private foundations
- Form 990-T: Intended for tax-exempt organizations to report unrelated business income of $1000 or more
If your organization qualifies for filing a 990-N or a 990-EZ, you can elect to file the long Form 990 instead.
Verify your organization’s filing deadline
Most 990 forms are due on the 15th day of the 5th month following the end of the organization’s tax year. For example, If your tax year ends in March, your due date will be August 15th.
If your organization follows a calendar year, your filing deadline is May 15th.
Please note that if the deadline falls on a weekend or a holiday, the due date will be pushed to the next business day.
Filing a 990 return after your deadline may lead to hefty penalties from the IRS. So, if you need an extension of time, you can file Form 8868 in advance and get a 6-month extension, making your deadline 6 months after your original filing deadline.
Gather and verify your organization’s necessary information
So, what exactly is required to be reported on a 990 form? To start off, you’ll need some basic information about your organization. Then, you’ll record financial details and descriptions of your organization’s activities.
It’s a good idea to keep the following details handy while filing your return:
- Organization Name
- Organization address
- Employer Identification Number (EIN)
- Tax year
- Gross receipts
- Financial information (revenue, expenses, assets, and liabilities)
- Program service accomplishments
- Other IRS filings and tax compliance requirements
- Key personnel, governing body, and management details
Pick an IRS-authorized e-file provider
As of 2019, all 990 forms must be filed electronically. This helps the IRS quickly notify filers of their form status and allows for a reduced processing time. This means you’ll have to choose an IRS-authorized e-file provider to file your form through.
The Authorized IRS e-file Provider database is a nationwide listing of businesses that are verified by the IRS to participate in the IRS e-filing program. Check out the IRS 990 Modernized e-File (MeF) provider listing to find out the trusted provider. Check out the IRS 990 Modernized e-File (MeF) provider listing to find out the trusted provider here.
You may decide to choose a provider based on parameters like location or features offered depending on your specific filing needs. It’s up to you, so make sure you research and compare providers to identify the right fit for you.
Once you choose a provider, you can start e-filing. The filing process might look different depending on the provider you choose, so be sure to report your information properly.
Proofread your return
Proofreading your return is probably the most important step in the filing process. You should be confident that the information you report is accurate and up to date. If you leave out any details, your entire return may be considered incomplete. The IRS reserves the right to impose penalties for incorrect and incomplete returns.
It’s time to get started!
Filing a 990 return is not exactly a walk in the park, but it’s important to the function of your organization. Now that you know the most important steps to file Form 990, you’re ready to meet all your 990 filing requirements effortlessly.
Olivia Massengale is a content writer for Tax990, an IRS-authorized 990 e-file provider. She enjoys creating informative content that helps clients understand and successfully e-file nonprofit tax returns.