Requirements for a Properly Completed IRS 990 Form

Every tax-exempt organization required to file IRS Form 990 or Form 990-EZ must complete Parts I through XII along with a Schedule O and any other schedules applicable to your organization. The same rules apply to tax-exempt groups who aren’t required to file a tax return but choose to do so.

Submitting an incomplete 990 form is similar to filing late – it can cost you thousands of dollars in penalties and late fees or even a loss of exemption status. Here are a few guidelines from the IRS about completing a 990 return correctly.

Signature and Recordkeeping
A 990 form is never complete with a signature – a primary officer that’s filing the form usually signs the return. If you are filing on behalf of an organization, your signature is required along with the primary officer.

Your organization’s records need to be archived and accessible for the provisional administration of the Internal Revenue Code for a minimum of three years – this includes documents supporting an item of income, deduction, credit, or basis of property. It’s also helpful to keep copies of prior year tax returns for future reference or amended filings.

Rounding Off to Whole Dollars
When filing returns and schedules, exempt organizations must round off cents to whole dollars. Increase amounts with 50 cents or higher to the nearest dollar – you can also decrease to the nearest dollar for amounts with less than 50 cents. If you are adding numbers together, you should only round the total sum.

Complete All Lines
You must make an entry for each line that requires an amount or any other information, even if the value is zero. Applicable lines should not be blank unless the instructions expressly say to skip. All Form 990/990-EZ must include a Schedule O which is used to provide explanations or additional information.

Reporting Proper Amounts
Some sections require information you’ve reported on other IRS forms. If you realize that numbers reported are incorrect, you should enter the correct values on the 990 return and also submit an amended form with the proper information.

The IRS also asks that you not report negative numbers – you should use zero as the value unless the instructions explain otherwise. Report expenses and revenue separately and do not combine related items.

Inclusion of Activities and Items of Disregarded Entities and Joint Ventures
Organizations must report all revenues, expenses, assets, liabilities, and net assets or funds of a disregarded entity or shares of the same items from a joint venture, other investment, or arrangement treated as a partnership. You are also responsible for reporting activities of your disregarded entity or a joint venture on the appropriate parts or schedules of the 990 form.

Reporting Information from Third Parties
There are a few sections that request information you may need to obtain from a third party – this can include various things like compensation paid by related organizations; family and business relationships between officers, directors, trustees, key employees, and individual businesses they own or control, etc.

You are responsible for getting and reporting this information. If you cannot retrieve through reasonable efforts or tax extension, you can explain or give an estimate with your Schedule O.

With ExpressTaxExempt.com, our interview-style process seamlessly guides you through each section of the 990 form and automatically generates appropriate schedules based on your answers. You won’t have to worry about questions that don’t pertain to your organization, and at the end, we present your entire tax return with its proper requirements for you to transmit.

Our U.S. – based support team of e-file professionals is available for questions or assistance with accurately sending your 990 tax return to the IRS. Call us at 704.839.2321, Monday through Friday from 9 a.m. to 6 p.m. EST. And we’re also available via email with [email protected].