Nonprofit Law Basics: Do Nonprofits File Tax Returns? What is a 990?

IRS Form 990s due for tax-exempt organizations

Do nonprofits file tax returns?

Most nonprofit tax-exempt organizations are required to file annual tax returns with the IRS. Even though most tax-exempt nonprofit organizations do not pay federal taxes (that is what “tax-exempt” means), most do have to file an informational return with the IRS. This annual reporting return is called a Form 990.

What is the IRS Form 990?

The IRS Form 990 is the reporting form that many federally tax-exempt organizations must file with the IRS each year. This form allows the IRS and the general public to evaluate a nonprofit’s operations; it includes information on the nonprofit’s mission, programs, and finances.

The type of Form 990 to be filed by an organization depends on the filing year and the gross receipts of the organization. The different forms include Forms 990, 990-EZ and 990-N.

Who files the IRS Form 990? Which Form 990 do we file?

Most federally tax-exempt organizations (with some exceptions like churches and state institutions) file a 990. All 501(c)(3) private foundations file a 990.

The IRS provides information to help you determine which form to file.

    • Larger nonprofits with gross receipts of more than $50,000 file Form 990 or 990-EZ
    • Smaller nonprofits with gross receipts of less than $50,000 file Form 990-N (e-Postcard)
    • Private foundations file Form 990-PF
    • Learn more here to see which forms to file.

What nonprofits are exempt from filing IRS Form 990s?

Not all nonprofits have to file annual returns. Generally, the following do not have to file Form 990:

    • Most faith-based organizations, religious schools, missions or missionary organizations
    • Subsidiaries of other nonprofits – those that may be covered under a group return filed by the parent organization
    • Many government corporations
    • State institutions that provide essential services.

It is important to check with the IRS to determine if your organization needs to file a return.

When is the IRS Form 990 due?

Your organization’s Form 990 is due on the 15th day of the 5th month after the end of the organization’s taxable year. This means that if your organization follows the calendar year (January 1 – December 31), your Form 990 would be due on May 15th of each year.

What happens if our nonprofit does not file IRS Form 990?

If an organization fails to file Form 990 three years in a row, the IRS will automatically revoke its tax-exempt status. Since 2011, more than 500,000 nonprofits across the country automatically lost their tax-exempt status for this reason. (Learn more about it here: You’ve Automatically Lost 501(c)(3) Tax-Exemption Status – Now What?)

The IRS has no appeal process for automatic revocations due to failure to file an appropriate Form 990 for three years. Without this status, your organization could be subject to paying income taxes. Additionally, you can avoid paying user fees and filing additional documents with the IRS by submitting your Form 990 each and every year.

Can IRS Form 990 be seen by the public?

Yes. Nonprofit organizations are required to make their IRS Form 990 and their exemption application available for public inspection during regular business hours.

Many nonprofits make 990s available for viewing on their websites. You can also view them at Guidestar, an organization that compiles information about nonprofits.

Resources

What Does It Mean for a Nonprofit to Lose Tax-Exempt Status? by Mollie Cullinane

I.R.S. List of NonprofitsAutomatic Revocation of Exemption List

Comments

  1. JL says

    As a member of a non profit org that tries to fundraise money to help spouses and children of the military go to college, I noticed that our tax id number had been revoked due to the assumption by past board members that just having the id # was sufficient and not being adequately trained or knowledable on the tax subject… No one filed the yearly 990. I’m starting the 1023 paperwork now to have the org be in good standing to try to get that tax id number back to be valid.

    My question: will we have to pay taxes on the year(s) they did not file the 990? That would kill our whole budget as we don’t have much money to begin with, but want to move ahead the legal way as well to help families. I know we have to pay the user fee with the 1023 but didn’t know about taxes since we hadn’t passed along the 990.

    Any insight and information would be greatly appreciated!!

  2. Quinn says

    If I have a private operating foundation (still 501c3), do I get three years before my first 990 is due? Or is that only for public 501c3’s?

  3. D'Angela Stafford says

    Hello,

    We have just organized a non profit group in a community where we grew up and we have not applied for non profit tax exempt status yet as we are looking into getting some help with doing that. My question is, do we need to file taxes even though we have not been granted the tax exempt status?

    Thanks,

    D’Angela Stafford

    • says

      Maybe. If your non-profit group claims to be tax-exempt and it plans to to file for tax-exempt status with the IRS, your group should file Form 990 (or 990-EZ or 990-N), even though no application has been submitted yet to the IRS nor any determination yet received. Even very small non-profits (receipts under $50,000) may be required to file these annual Form 990s. Feel free to give us a call at 512-298-2898 if you’d like to discuss your options. We are glad to help! Best regards, Mollie Cullinane

  4. Humphrey Lee says

    I setup a non profit organization in New York City and still pending approval 501(c) (3) from IRS.
    I knew I have to file Form 990 EZ or 990 N. However, do I need to file any tax return to New York State ?

  5. Waynette Hollis says

    Hi, we incorporated a nonprofit in 2013 and obtained tax exempt status. Unfortunately, we haven’t been able to fully begin operations and therefore have had no cash flow since incorporation . I fear that we may still need to file an information return but have not done so. Is there something we must file to say we have had no income in order to avoid an automatic revocation?

    • says

      Please check with the IRS to make sure your status is still in place. If it is, get your IRS Form 990-N filed as soon as possible. Since there was $0 revenue, your organization sounds eligible for the 990-N e-postcard filing. There are no penalties for late filings. However, if you don’t file for 3 years in a row, your group can automatically lose its tax-exempt status.

  6. Matt Jones says

    First I’d like to say thank-you for what you do. It’s good to see someone is looking out for the little guys. We are a small local union with 34 members who work for a large railroad. The previous Treasurer left his position for work else where. None of the remaining members are good with accounting or taxes. Myself and the Local Chairman have taken on the task of doing the taxes. We are clueless. We had tax exempt status I believe 2 1/2 years ago but, unfortunately no one has kept up with it. To be honest no one really knows what Tax Exempt means. Does that mean we haven’t had to file and pay Federal Income Taxes? We have and will have paid Federal including this year for 3 years worth. If it’s not 3 years can we try re-establishing our tax exempt status by filing the last three years for the 990-N? We are hemoraging our checking account and just barely getting by. Is there a way to get refunded for the past years we’ve paid if we are still exempt? Any advice would be greatly appreciated. Thanks again for what you do!

    • says

      Hello Matt: The tax matters can be so frustrating, right!? It sounds like the first step will be to reach out to the IRS to make sure your tax-exempt status is in place. You can call the IRS at (877) 829-5500 (I advise call first thing in the morning so you don’t have quite as long as wait). You could also check your status through the IRS’s EO (“exempt organizations”) Select Check. Here is the link: https://www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check. If your group has lost its status, there are some ways to get it back. Verify your status first…then we can figure out next steps. -Mollie

  7. Pete Rivera says

    As a Church we file an annual report to the state and have a non-profit (Consumer Certificate of Exemption) updated regularly. But we do not file 990 and do not show up in the IRS data base.
    Some members periodically ask about using setting up charity (non-profit) buying services through either Amazon or Shop.com. They require an IRS letter of Exemption.
    Is there a way of getting around this without having to file through the IRS?

  8. Angeline says

    Hello, our non-profit org just started up in Oct 2015 and we missed our first year 990-N e-postcard filing that was due on May 15th of this year. The question is can you file late? Can we submit to the IRS now??

    • says

      Yes – file it. Most small tax-exempt organizations (whose annual gross receipts are normally $50,000 or less) can satisfy their annual reporting requirement by electronically submitting Form 990-N (if they choose not to file Form 990 or Form 990-EZ instead). Form 990-N is due every year by the 15th day of the 5th month after the close of your tax year.

      If your 990-N is late, the IRS will send a reminder notice to the last address the IRS has on file.

      While there is no penalty assessment for filing Form 990-N late, organizations that fail to file required Forms 990, 990-EZ or 990-N for three consecutive years will automatically lose their tax-exempt status. Revocation of the organization’s tax-exempt status will happen on the filing due date of the third consecutively-missed year.

  9. Karen says

    We filed and were granted Non Profit Status with the State of Kentucky. Nowhere in our filing does it mention tax exempt. Our donations (only source of income) during inception in 2013 have been less than 3K per year. We have stayed current with our Non Profit filings with the State, however, we are concerned about filing taxes. Can you please advise – are we required to file some type of form with the Federal Tax Department – and our State? Thank you for your time regarding our inquiry.

    • says

      Hi Karen – It will be important for you to check that your Non Profit is still in good standing with Kentucky – call the Secretary of State and state tax office. You’ll want to call the IRS to check your status and any tax obligations you may have. Good luck! -Mollie Cullinane

  10. says

    I just pulled down some very impressive information on “what are the duties are for Board of Directors.”
    This information is so helpful. Thank you for being available to us. I’m trying to change the actual Board Members’ name to add the real Board Members that just became members. Can you tell me how to do it?

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