A local or subordinate organization that doesn’t file its own annual information return (because it is affiliated with a central or parent organization that files a group return) must, upon request, make available for public inspection, or provide copies of, the group returns filed by the central or parent organization. Except as otherwise provided, a regional or district office of a tax-exempt organization must satisfy the same rules as the principal office for allowing public inspection and providing copies of its application for tax exemption and annual information returns. For this purpose, the excess benefit is defined as the amount of the grant, loan, compensation, or similar payments.

Return of Organization Exempt From Income Tax – Introductory Material

These contributions are amounts received by the organization for allowing an outside organization (donor) or individual to use the recipient organization’s name in a sales promotion campaign, such as where the outside organization agrees to contribute 2% of all sales proceeds to the organization. The following how to read a 990 are examples of governmental grants and other payments that are treated as contributions and reported on line 1. A grant is still equivalent to a contribution if the grant recipient performs a service, or produces a work product, that benefits the grantor incidentally, but see the instructions for Line 1.

• Employers who maintain pension, profit-sharing, or other funded deferred compensation plans are generally required to file Form 5500.
• Members have the privilege of purchasing subscriptions to the symphony’s annual concert series before they go on sale to the general public, but must pay the same price as any other member of the public.
• Enter on lines 11a through 11g amounts for services provided by independent contractors for management, legal, accounting, lobbying, professional fundraising services, investment management, and other services, respectively.
• See Schedule B and its instructions to determine whether Schedule B must be filed, and for the public inspection rules applicable to that form.
• Corporation K makes a $50,000 payment to J and in return, J offers K’s employees free admission, a T-shirt with J’s logo that costs J $4.50, and a 25% gift shop discount.
• The contribution of $240, which is the difference between the buyer’s payment and the retail value of the dinner, would be reported on line 1c and again on line 8a (within parentheses).

Return of Organization Exempt From Income Tax – Notices

The pace of worker compensation plays a big role in businesses’ labor costs. When pay accelerates especially fast, it increases the labor costs of companies, which often respond by raising their prices. Instead, see General Instructions D. When, Where, and How To File, earlier, for the location for filing your return.

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In addition, for purposes of Form 990, including Part VII, Section A, and Schedule J (Form 990), treat as an officer the following persons, regardless of their titles. Answer “Yes” if the organization is organized as a stock corporation, a joint-stock company, a partnership, a joint venture, or an LLC. Also answer “Yes” if the organization is organized as a non-stock, nonprofit, or not-for-profit corporation or association with members. For purposes of Part VI, a membership organization includes members with the following kinds of rights. Part VI requests information regarding an organization’s governing body and management, governance policies, and disclosure practices. Although federal tax law generally doesn’t mandate particular management structures, operational policies, or administrative practices, every organization is required to answer each question in Part VI.

• M is an organization whose primary purpose is to support the local symphony orchestra.
• Make an entry (including -0- when appropriate) on all lines requiring an amount or other information to be reported.
• If the organization wants to expand the paid preparer’s authorization or revoke it before it ends, see Pub.
• As such, private foundations must make the return available for public inspection.
• 4302, A Charity’s Guide to Vehicle Donation; and the Instructions for Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes.
• A tax-exempt political organization must file Form 990 or 990-EZ if it had $25,000 or more in gross receipts during its tax year, even if its gross receipts are normally $50,000 or less, unless it meets one of the exceptions for certain political organizations under Section B, later.

How to read a charity 990 tax form

Contributions received indirectly from the public through solicitation campaigns of federated fundraising agencies (United Way) are included on line 1. See Appendix B and Appendix C, later, for a discussion of gross receipts. The central/parent organization of a group ruling can’t file a group return with Form 990-EZ but must use Form 990. If a change of address occurs after the return is filed, use Form 8822-B, Change of Address or Responsible Party — Business, to notify the IRS of the new address. In general, answers can be explained or supplemented in Schedule O (Form 990) if the allotted space in the form or other schedule is insufficient, or if a “Yes” or “No” answer is required but the organization wishes to explain its answer. If you are filing a 2023 Form 990-EZ, you are required to file electronically.

The Importance of Filing Form 990

Check this box if the organization changed its legal name (not its “doing business as” name) and if the organization hasn’t reported the change on its most recently filed Form 990 or 990-EZ or in correspondence to the IRS. If the organization changed its name, attach the following documents. Make an entry (including -0- when appropriate) on all lines requiring an amount or other information to be reported.

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See Appendix G for more information about completing a Form 990-EZ to be filed with any state or local government agency. Activities that generate only contributions aren’t fundraising events. A wagering game that doesn’t meet the legal definition of bingo doesn’t qualify for the exclusion from unrelated business income, regardless of its name.

• See Appendix G, later, for a discussion of section 4958; Schedule L (Form 990), Part I; and Form 4720, Schedule I, regarding reporting of excess benefit transactions.
• A group return filed by the central or parent organization on behalf of the subordinates in a group exemption must be filed using Form 990, not Form 990-EZ.
• This tax, which can’t exceed $20,000 for any single transaction, is only imposed if the 25% tax is imposed on the disqualified person, the organization manager knowingly participated in the transaction, and the manager’s participation was willful and not due to reasonable cause.
• Management companies and similar entities that are independent contractors shouldn’t be reported as key employees.
• For instance, answer “No” if the organization made a $4,000 grant to each of two domestic organizations and no other grants.
• Subtract line 6b from line 6a for both columns (i) and (ii) and enter on line 6c.