Stay Tax Exempt
News Flash
Every nonprofit organization must file an annual 990.
The change happened a few years ago, but may not have received adequate attention. All nonprofits, not just organizations with revenues of $25,000 or more, must file a tax return. Any organization that does not file a 990 for three consecutive years will lose their tax exempt status. The federal law requiring this change was passed in 2006, and the first three-year window closes May 15th, 2010.
If you work for a nonprofit, hopefully you already know this and are aware of the upcoming May 15th deadline – the date when organizations with a December 31st year end must file their 990 with the IRS.
Although this change could negatively impact thousands of organizations, there is still time to meet your filing deadline.
(Update: The Star Tribune has published an excellent article on these changes.)
Steps to Staying Tax Exempt
Visit the IRS Website
- Find out your filing deadline – all you need to know is your fiscal year end
- Find out which form to file (this chart is taken directly from the IRS website)
| Financial activity | Filing requirement |
| Gross receipts normally ≤ $25,000 Note: Organizations eligible to file the e-Postcard may choose to file a full return. |
990-N (e-Postcard) |
| Gross receipts < $ 500,000 and Total assets < $1.25 million |
990-EZ or 990 |
| Gross receipts ≥ $500,000, or Total assets ≥ $1.25 million |
990 |
| Private foundation (regardless of financial activity) | 990-P |
- If you need to file an extension, these are the procedures for Form 990 or 990-EZ
Prepare Your Form
- Small organizations only need 8 pieces of information to file the 990-N (aka e-Postcard). If you file this form on time, your organization will remain tax exempt.
- The National Center for Charitable Statistics (NCCS) has a tool to help organizations e-file the 990 or 990-EZ. It is free for nonprofits with less than $100,000 in annual revenue.
Not sure if your organization is at risk?
Find Out More
- Stay Tax Exempt – a mini training site from the IRS
- Updates on Your Exempt Status and a Form 990 To-Do List from Nonprofit Accounting
- Information from Tech Soup, including links to discounted accounting software
- For more resources visit our previous blog post, New Year, New You