Non-profit organizations except churches should file an annual income information return since 2010. 990n is a simple form online for such non-profit organizations to file returns online every year. The gross revenue that IRS laid down for filing under 990n should be less than $50,000 per year. Churches, their integrated auxiliaries, and conventions or association of churches are exempted from filing this form 990n with IRS through e-postcard.
The Form 990N is very simple. There are only 6 questions. No financial information is given.
A. The calendar year or tax year dates
B. Check if gross receipts are $50,000 or less
C. Name and address of the organization
D. Employer Identification Number (EIN)
F. Officer name and address
- 990n for groups or organization is due every calendar year on May 15th which is five months from the previous December 31.
- The non-profit organization will have two very big tax holidays through their qualifications of filing under section 501(C) (3) of the US Internal Revenue Code.
- By declaring the State Tax Authority of their tax-exempt status under section 501(C)(3), they can get away with filing Federal tax returns.
- Money donors who donate to these non-profit organizations can deduct their donations while filing their tax returns.
Understanding Form 990N Filing for Nonprofits
The filing returns of the form 990n is a must before filing 501(C)(3) (tax-exempt act) wherein the organization is involved in activities Viz., educational, religious, charitable, literary, scientific, avoiding cruelty to children and animal, promoting amateur sports competition and public safety.
If you have not filed for your status under 501(C)(3) with IRS then you may have to contact the IRS accounts helpline to request for addition to their database and then can start filing your Form 990n returns.
If 990n is not filed, IRS may remind you but may not penalize you.IRS would penalize in case the organization fails to file 990n for three consecutive years and the tax-exempt case may be withdrawn only when the organization re-submits itself through 1023 or 1024 and with the charges pending for the last 3 years when not under tax-exempt including IRS filing fees.
Most of the small non-profit organizations did not have time to file 990n within the stipulated May 15th because IRS published the new requirement only two days before May 15,2010, so no penalties were forced or fined on non-profits by IRS despite their late filings of form 990n electronically.
It is always better for organizations to check with their accountants, CPAs, and tax adviser about their payments and receipts through donations to make sure that their annual gross revenues are $50,000 or less before filing online.
IRS really wants to help non-profit organizations doing good causes. After 2008, the Congress and IRS passed a resolution to streamline the organizations existing or closed, and hence in 2010 form 990n came into force. Fortunately, IRS is not penalizing the organization for not filing late returns from 2008 is welcoming news.