Most non-profit organizations are required to file an annual information return. However, there are some exceptions to this requirement for certain religious and political organizations. To find out if your organization is excluded from the filing requirement, contact one of our experts from our non-profit team.
It is important to ensure that your non-profit organization is filing the required returns on time, as the IRS will automatically revoke an organization’s tax-exempt status if it does not file the required returns for three consecutive years. Once the tax-exempt status is revoked, the organization must reapply for tax-exempt status which is a complex and lengthy process.
The forms required for non-profit organizations are the 990 series forms and include forms 990-N, 990-EZ, 990, and 990-PF. The 990-N, also called the e-postcard, is the most basic return and requires just eight pieces of information. This form must be filed electronically, as there is no paper form. The 990-EZ is more complex and requires more information than the 990-N, but less so than the 990. The 990 can become quite complex and may include multiple schedules, depending on the organization’s activities. The 990-PF is specifically for private foundations.
The determination as to which form is required is based on the organization’s gross receipts and total assets. The filing thresholds are summarized below:
- 990-N: Gross receipts are ≤ $50,000
- 990-EZ: Gross receipts are < $200,000 and total assets are < $500,000
- 990: Gross receipts are ≥ $200,000 or total assets are ≥ $500,000
- 990-PF: Required for private foundations regardless of financial status
In addition to the annual information return requirements discussed above, a non-profit organization may also be required to file form 990-T. Form 990-T is used to report unrelated business income and is an income tax return rather than an information return. Unrelated business income is income earned from a trade or business that is not related to the organization’s exempt purpose. The threshold for filing the 990-T is gross unrelated business income of $1,000 or more. Income tax is calculated on the net unrelated business income and estimated tax payments must be made if the tax is expected to be $500 or more.
If you operate a non-profit organization and are unsure of your organization’s filing requirements, Ketel Thorstenson, LLP has a team of experts available to assist you.