IRS Form 990 Governance Guidance

Good Governance Practices

These are essential to sustaining a nonprofit’s mission. But what exactly is “good governance”? There is no single set of expectations for good governance. However, as a result of the 2008 revision of the IRS Form 990, certain practices are expected to be followed by nonprofits, large and small. Collectively the questions asked by the IRS in the revised Form 990 reflect the opinion of the IRS that certain governance practices, together with written policies, will result in compliance with the laws governing tax-exempt organizations.

All about governance policies (National Council of Nonprofits).

Annual reports to the IRS: Does your nonprofit have to file?

Update: the law has changed as a result of the passage of the Federal Pension Protection Act. All nonprofits recognized as tax-exempt by the IRS (or those awaiting recognition) must now file an annual information return (one of the "990" forms). Prior to 2010, smaller nonprofits, those with less than $25,000 in gross receipts annually, did not have to file annually. Now, all tax-exempt organizations must file every year. Failure to file for three consecutive years will result in automatic revocation of tax-exemption.

Read all about state and federal annual filing requirements for nonprofits.

Most small tax-exempt organizations whose annual gross receipts are normally $50,000 or less may now electronically submit Form 990-N, also known as the e-Postcard, unless they choose to file a complete Form 990 or Form 990-EZ.

Automatic Revocation of Exemption for Failure to File

Charitable nonprofits that are tax-exempt will automatically lose their tax-exempt status if they fail to file annual returns with the IRS for three consecutive years. View the IRS automatic revocation list and review the Council of Nonprofits' special webpage on automatic revocation.