Tips for Reporting Supplemental Financial Statements
Donor Advised Funds
Tax-exempt groups that managed donor advised funds at any time during the tax year need to answer “Yes” to Line 6, Part IV. A donor advised fund or similar funds are accounts in which the donor, or someone appointed by the donor, has advisory privileges over the use of any portion of the account.
If information about donor-advised funds applies to your organization, you must provide the total number of managed accounts for the year, the aggregate value of contributions made during the year, the aggregate value of grants given during the year, and total aggregate value of funds at the end of the year.
Conservation Easements
A conservation easement is an agreement established for the purpose of conservation and preservation of property held by the organization. If you answer “Yes” to Line 7, Part IV, you need to explain to the purpose of the conservation easement held by your organization.
If you indicate that your organization held a qualified conservation contribution in the form of a conservation easement on the last day of the tax year, you’re responsible for providing follow-up information such as the total number of easements and total acreage restricted.
Art and Museum Collections
Answer “Yes” to Line 8, Part IV, if your tax-exempt group maintained collections of works of art, historical treasures, and other similar assets at any time during the tax year. Be prepared to indicate revenue related to collections and assets related to collections reported under SFAS 116 (ASC 958).
You’re also required to state the significant use of the collection items, a description of the organization’s collections, and an explanation how they further the organization’s exempt purpose. And finally, report if items from the collection were sold to raise funds rather than maintained.
Escrow or Custodial Accounts
Organizations that have funds in an escrow or custodial account for other individuals or organizations, provides credit counseling services or debt management plan services, or acts as an agent, trustee, custodian, or another intermediary for contributions or other assets should answer “Yes” to Line 9, Part IV.
If your organization acts as an agent, you’ll need to enter the escrow or custodian fund details including beginning balance, addition amounts, distribution amounts, and ending balance for the year and also provide an explanation of the arrangement.
Endowment Funds
If your organization held assets in temporarily restricted endowments, permanent endowments, or quasi-endowments, you should answer “Yes” to Line 10, Part IV. You’re required to enter the amounts of the current year and prior year contributions, grants, administrative expenses, and asset transfers to the organization’s endowment funds.
Report the estimated percentage of your organization’s total endowment funds and also provide information on other endowment funds that are not in your possession. Near the end, you need to describe the intended uses of the organization’s endowment funds.
With ExpressTaxExempt.com, you are guided effortlessly through each of these sections. If you answer “Yes” to any of the initial questions, our application presents the required follow-up questions, and your answers are entered in the generated schedules automatically.
Contact our U.S. – based customer support team for any questions or further assistance with e-filing your 990 form through our cloud-based service. We’re available at 704.839.2321, Monday through Friday from 9 a.m. to 6 p.m. EST. Or reach us via email with [email protected].
