OUR THOUGHTS ON:

IRS Advisory Committee Revisiting the Form 990

Higher Education|Not-for-Profit|Tax

By Susan Kirsch

The IRS Advisory Committee on Tax-Exempt and Government Entities (ACT) released its 2015 report on June 17, 2015 detailing recommendations for consideration by the IRS. They focused their recommendations on revisiting the Form 990 in light of the fact that the redesigned form is now seven years old. With the learning curve behind exempt organizations, the group suggested that the IRS step back and reevaluate the form and its instructions with a focus on increased clarity and transparency.

IRS Advisory Committee on Tax-Exempt and Government Entities Recommendations for the Form 990

  1. A Congressional mandate to require electronic filing of the Form 990 Series should be supported by the IRS, and in the absence of legislation, the IRS should encourage and provide incentives for electronic filing.
  2. A task force should be convened by the IRS Exempt Organization Division to determine what parts of the Form 990 and its related instructions should be updated, modified and/or deleted in order to allow a clearer understanding, accuracy and enhanced consistency among filers.
  3. Consideration should be given to requesting additional information from Form 990-N filers. The Form 990-N is an electronic postcard filed by small organizations with gross receipts normally less than $50,000 and reports basic organizational information. Because neither the Form 990-N nor the Form 1023-EZ require significant detail regarding the organization’s activities, the group believes that perhaps the Form 990-N disclosures should be expanded to capture this information in public comments.

Tamera Ripperda, IRS Exempt Organizations Director, has publicly supported e-filing, but absent congressional action, the IRS can only encourage e-filing. Ms. Ripperda also committed to finding ways to assist the exempt organization community with Form 990 compliance through outreach and education.

Contact us with questions regarding filing your organization's Form 990 and visit the Not-for-Profit blog posts on our website for similar articles.

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