mission Matters Nonprofits…Are you Ready for the 2023 990 Deadline? March 30, 2023 Attention nonprofit organizations…are you ready for the May 15th Form 990 deadline? You don’t want to lose your tax-exempt status by failing to file. Nonprofits, are you prepared for the May 15th 990 deadline? Maintaining your tax-exempt status depends on your timely compliance! Don’t be late. What is the form 990? Filing the Form 990 is an important aspect of a tax-exempt organization's life cycle. It serves two functions for two important audiences. Informs the public -- The Form 990 informs the public about crucial aspects of your nonprofit. Most of the pages and tables are available for public inspection, including those describing executive compensation and program expenditures. Potential donors and grantors can, and many routinely do, look at an organization's Form 990 before making decisions about charitable giving. The media and nonprofit-watchdog groups may also check out 990s. Informs the IRS -- The Form 990 provides the IRS with information about your nonprofit's activities and financial status in order to demonstrate that your nonprofit still meets the qualifications for tax-exemption. More about the deadline Form 990, 990-T, 990-EZ, 990-N and 990-PF must be filed by the 15th day of the 5th month after the end of your organization’s accounting period. For a calendar-year organization (December 31st year end), the forms are due May 15th of the following year. Can you file for an extension? Yes. Through Form 8868, you can request an automatic 6-month extension of time to file Form 990, 990-T, 990-EZ and 990-PF. The 990-N cannot be extended and there is no penalty for submitting late. While there is no penalty for filing the 990-N late, an organization’s tax-exempt status will be revoked if the organization does not file 990-N for three consecutive years. What is the difference between the 4 versions? Form 990 - Organizations with gross receipts of $200,000 or more and total assets greater than or equal to $500,000 must file a Form 990. Form 990 requires the organization to describe its overall mission, notable activities, details on revenues, expenses, assets, liabilities, and details on governance as well. Form 990-T – Organizations with gross receipts of $1,000 or more in income from unrelated business activities are required to file Form 990-T along with their Form 990. Form 990-EZ - For organizations with gross receipts totaling less than $200,000 and total assets less than $500,000, Form 990-EZ can be used. It is considered the “short” version of the regular Form 990. Form 990-N - This version is often referred to as the “e-postcard” which is the shortest version of the Form 990 but can only be submitted by organizations with gross receipts of $50,000 or less. The “e-postcard,” is filed online via the IRS website. Form 990-PF- This version is for all types of private foundations, regardless of income. What is the penalty for noncompliance? If you fail to file the appropriate 990 for three consecutive years, your tax exempt status will be revoked. There is also a daily penalty for late filing, which can add up fast, so be sure you’re filing the right form and getting it in before the deadline. What is the penalty for failure to file? A penalty of $20 a day, not to exceed the lesser of $11,000 or 5% of the gross receipts of the organization for the year, can be charged when a return is filed late, unless the organization shows that the late filing was due to reasonable cause. Organizations with annual gross receipts exceeding $1,129,000 are subject to a penalty of $110 for each day failure continues (with a maximum penalty for any one return of $56,000). The penalty applies on each day after the due date that the return isn't filed. Need help filing? We can help. Contact any member of our Nonprofit Services Team. Check out our 990 Blog Series for more information.
