Federal Filing Requirements for Nonprofits

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Most charitable nonprofits that are recognized as tax-exempt have an obligation to file an annual information return with the IRS. (There are very few exceptions: church-affiliated organizations and governmental organizations are among those not required to file.) The IRS Form 990 is a public document, so make sure that your nonprofit's board reviews it before it's filed, and that it is completed thoughtfully as well as accurately. Look to the IRS website for guidance on annual reporting of the Form 990. If a nonprofit is incorporated in a state but has never been recognized by the IRS as “tax-exempt,” then it does not have an obligation to file an annual information return with the IRS. Note: Conversely, even if your organization fits one of the few exceptions to mandatory annual filing with the IRS, it may still have to file forms annually in the state where it is incorporated, or where it engages in fundraising activities. See information on required state filings.

Most small tax-exempt organizations with gross receipts that are normally $50,000 or less must file the IRS form 990-N, known as the "e-postcard".

Exceptions to this filing requirement include:

Background  

IRS information returns are known as the "990 series" because there are several forms that use the number 990, including Form 990, Form 990-EZ, and for the smallest nonprofits, Form 990-N

Federal Filing Deadlines

A charitable nonprofit’s Form 990 must be filed with the IRS on the 15th day of the  5th month after the close of the nonprofit’s fiscal year.

What happens if our nonprofit fails to file?

If a charitable nonprofit fails to file the 990 on time, there can be penalties for late filing and income tax liability. If a nonprofit fails to file for three years in a row, the nonprofit’s tax-exempt status will be automatically revoked. Learn more.

  • The IRS publishes the list of organizations whose tax-exempt status was automatically revoked because of failure to file a required Form 990, 990-EZ, 990-PF or Form 990-N (e-Postcard) for three consecutive years.
  • Use Form 8868 to request an automatic 3-month extension of time to file.
  • The 990-N due date cannot be extended, but there is no penalty for submitting it late.

Loss of tax-exempt status: Organizations that lose their tax exempt status are no longer eligible to receive tax-deductible contributions, and may be required to pay corporate income tax. Read about what to do if your nonprofit’s status has been revoked.

Resources

Practice Pointer

Should the board review the annual report to the IRS? The redesigned Form 990 asks in Section B, line 11: “Has the organization provided a copy of its Form 990 to all members of its governing body prior to filing the form?” The Form goes on to ask the organization to “describe the process used by the organization to review” the Form 990." As a result, many nonprofits choose to adopt a basic financial policy that requires full board review of the Form 990 before filing with the IRS. Read about other Form 990 good governance practices.

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