The IRS Schedule A 990 or 990-EZ form serves as a critical document for organizations seeking to qualify for tax-exempt status under Section 501(c)(3). It meticulously details the various sources of an organization's income, corroborating its non-profit nature and adherence to guidelines governing charitable institutions. Interested parties are encouraged to fill out the form accurately to maintain compliance and ensure their eligibility for tax exemptions. Click this button to start the filing process.
Navigating the complexities of tax documentation can often seem like a daunting task, especially for non-profit organizations striving to maintain compliance while focusing on their mission. The IRS Schedule A 990 or 990-EZ form emerges as a critical component in this landscape, providing a structured way for these organizations to report their public charity status and demonstrate compliance with tax exemption requirements. It encapsulates detailed reporting on various aspects such as donations received, activities conducted, and governance practices undertaken throughout the fiscal year. This form acts not just as a means of regulatory compliance, but also as a tool for transparency, allowing the public to understand how the organization operates, how it utilizes its resources, and how it makes a difference in the community it serves. Given its importance, both in terms of compliance and public trust, getting acquainted with the major aspects of the Schedule A 990 or 990-EZ form is indispensable for non-profit organizations. It ensures they can effectively communicate their commitment to their cause while upholding the legal and ethical standards expected of them.
SCHEDULE A
Public Charity Status and Public Support
OMB No. 1545-0047
2021
(Form 990)
Complete if the organization is a section 501(c)(3) organization or a section 4947(a)(1) nonexempt charitable trust.
Department of the Treasury
▶ Attach to Form 990 or Form 990-EZ.
Open to Public
Internal Revenue Service
▶ Go to www.irs.gov/Form990 for instructions and the latest information.
Inspection
Name of the organization
Employer identification number
Part I Reason for Public Charity Status. (All organizations must complete this part.) See instructions.
The organization is not a private foundation because it is: (For lines 1 through 12, check only one box.)
1 A church, convention of churches, or association of churches described in section 170(b)(1)(A)(i).
2 A school described in section 170(b)(1)(A)(ii). (Attach Schedule E (Form 990).)
3 A hospital or a cooperative hospital service organization described in section 170(b)(1)(A)(iii).
4 A medical research organization operated in conjunction with a hospital described in section 170(b)(1)(A)(iii). Enter the hospital’s name, city, and state:
5 An organization operated for the benefit of a college or university owned or operated by a governmental unit described in section 170(b)(1)(A)(iv). (Complete Part II.)
6 A federal, state, or local government or governmental unit described in section 170(b)(1)(A)(v).
7 An organization that normally receives a substantial part of its support from a governmental unit or from the general public described in section 170(b)(1)(A)(vi). (Complete Part II.)
8 A community trust described in section 170(b)(1)(A)(vi). (Complete Part II.)
9 An agricultural research organization described in section 170(b)(1)(A)(ix) operated in conjunction with a land-grant college or university or a non-land-grant college of agriculture (see instructions). Enter the name, city, and state of the college or university:
10
11
12
An organization that normally receives (1) more than 331/3% of its support from contributions, membership fees, and gross receipts from activities related to its exempt functions, subject to certain exceptions; and (2) no more than 331/3% of its support from gross investment income and unrelated business taxable income (less section 511 tax) from businesses acquired by the organization after June 30, 1975. See section 509(a)(2). (Complete Part III.)
An organization organized and operated exclusively to test for public safety. See section 509(a)(4).
An organization organized and operated exclusively for the benefit of, to perform the functions of, or to carry out the purposes of one or more publicly supported organizations described in section 509(a)(1) or section 509(a)(2). See section 509(a)(3). Check the box on lines 12a through 12d that describes the type of supporting organization and complete lines 12e, 12f, and 12g.
a
Type I. A supporting organization operated, supervised, or controlled by its supported organization(s), typically by giving the supported organization(s) the power to regularly appoint or elect a majority of the directors or trustees of the supporting organization. You must complete Part IV, Sections A and B.
b
c
d
Type II. A supporting organization supervised or controlled in connection with its supported organization(s), by having control or management of the supporting organization vested in the same persons that control or manage the supported organization(s). You must complete Part IV, Sections A and C.
Type III functionally integrated. A supporting organization operated in connection with, and functionally integrated with, its supported organization(s) (see instructions). You must complete Part IV, Sections A, D, and E.
Type III non-functionally integrated. A supporting organization operated in connection with its supported organization(s) that is not functionally integrated. The organization generally must satisfy a distribution requirement and an attentiveness requirement (see instructions). You must complete Part IV, Sections A and D, and Part V.
e Check this box if the organization received a written determination from the IRS that it is a Type I, Type II, Type III functionally integrated, or Type III non-functionally integrated supporting organization.
f Enter the number of supported organizations . . . . . . . . . . . . . . . . . . . . . .
gProvide the following information about the supported organization(s).
(i) Name of supported organization
(ii) EIN
(iii) Type of organization
(iv) Is the organization
(v) Amount of monetary
(vi) Amount of
(described on lines 1–10
listed in your governing
support (see
other support (see
above (see instructions))
document?
instructions)
Yes
No
(A)
(B)
(C)
(D)
(E)
Total
For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ.
Cat. No. 11285F
Schedule A (Form 990) 2021
Page 2
Part II Support Schedule for Organizations Described in Sections 170(b)(1)(A)(iv) and 170(b)(1)(A)(vi) (Complete only if you checked the box on line 5, 7, or 8 of Part I or if the organization failed to qualify under Part III. If the organization fails to qualify under the tests listed below, please complete Part III.)
Section A. Public Support
Calendar year (or fiscal year beginning in) ▶
1Gifts, grants, contributions, and membership fees received. (Do not include any “unusual grants.”) . . .
2Tax revenues levied for the organization’s benefit and either paid to
or expended on its behalf . . . .
3The value of services or facilities furnished by a governmental unit to the organization without charge . . . .
4Total. Add lines 1 through 3 . . . .
5The portion of total contributions by each person (other than a governmental unit or publicly supported organization) included on line 1 that exceeds 2% of the amount shown on line 11, column (f) . . . .
6Public support. Subtract line 5 from line 4
Section B. Total Support
(a)2017
(b)2018
(c)2019
(d)2020
(e)2021
(f)Total
(a) 2017
(b) 2018
(c) 2019
(d) 2020
(e) 2021
(f) Total
7
Amounts from line 4
8
Gross income from interest, dividends,
payments received on securities loans,
rents, royalties, and income from
similar sources
9Net income from unrelated business activities, whether or not the business is regularly carried on . . . . . .
10Other income. Do not include gain or loss from the sale of capital assets (Explain in Part VI.) . . . . . . .
Total support. Add lines 7 through 10
Gross receipts from related activities, etc.
(see instructions)
13First 5 years. If the Form 990 is for the organization’s first, second, third, fourth, or fifth tax year as a section 501(c)(3) organization, check this box and stop here . . . . . . . . . . . . . . . . . . . . . . . . . ▶
Section C. Computation of Public Support Percentage
14
Public support percentage for 2021 (line 6, column (f), divided by line 11, column (f)) . . . .
%
15
Public support percentage from 2020 Schedule A, Part II, line 14
16a
331/3% support test—2021. If the organization did not check the box on line 13, and line 14 is 33
1/3% or more, check this
box and stop here. The organization qualifies as a publicly supported organization
▶
b331/3% support test—2020. If the organization did not check a box on line 13 or 16a, and line 15 is 331/3% or more, check this box and stop here. The organization qualifies as a publicly supported organization . . . . . . . . . . . ▶
17a 10%-facts-and-circumstances test—2021. If the organization did not check a box on line 13, 16a, or 16b, and line 14 is 10% or more, and if the organization meets the facts-and-circumstances test, check this box and stop here. Explain in Part VI how the organization meets the facts-and-circumstances test. The organization qualifies as a publicly supported organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶
b10%-facts-and-circumstances test—2020. If the organization did not check a box on line 13, 16a, 16b, or 17a, and line 15 is 10% or more, and if the organization meets the facts-and-circumstances test, check this box and stop here. Explain in Part VI how the organization meets the facts-and-circumstances test. The organization qualifies as a publicly supported
organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶
18Private foundation. If the organization did not check a box on line 13, 16a, 16b, 17a, or 17b, check this box and see
instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶
Page 3
Part III Support Schedule for Organizations Described in Section 509(a)(2)
(Complete only if you checked the box on line 10 of Part I or if the organization failed to qualify under Part II. If the organization fails to qualify under the tests listed below, please complete Part II.)
1Gifts, grants, contributions, and membership fees received. (Do not include any “unusual grants.”)
2Gross receipts from admissions, merchandise sold or services performed, or facilities furnished in any activity that is related to the organization’s tax-exempt purpose . . .
3Gross receipts from activities that are not an unrelated trade or business under section 513
4Tax revenues levied for the
organization’s benefit and either paid to or expended on its behalf . . . .
5The value of services or facilities furnished by a governmental unit to the organization without charge . . . .
6Total. Add lines 1 through 5 . . . .
7a Amounts included on lines 1, 2, and 3
received from disqualified persons .
bAmounts included on lines 2 and 3 received from other than disqualified persons that exceed the greater of $5,000 or 1% of the amount on line 13 for the year
c Add lines 7a and 7b . . . . . .
8Public support. (Subtract line 7c from line 6.) . . . . . . . . . . .
9
Amounts from line 6
10a
payments received on securities loans, rents,
royalties, and income from similar sources .
bUnrelated business taxable income (less section 511 taxes) from businesses acquired after June 30, 1975 . . . .
c Add lines 10a and 10b . . . . .
11Net income from unrelated business activities not included on line 10b, whether or not the business is regularly carried on
12Other income. Do not include gain or loss from the sale of capital assets (Explain in Part VI.) . . . . . . .
13Total support. (Add lines 9, 10c, 11, and 12.) . . . . . . . . . .
14First 5 years. If the Form 990 is for the organization’s first, second, third, fourth, or fifth tax year as a section 501(c)(3) organization, check this box and stop here . . . . . . . . . . . . . . . . . . . . . . . . . ▶
Public support percentage for 2021 (line 8, column (f), divided by line 13, column (f))
16
Public support percentage from 2020 Schedule A, Part III, line 15
Section D. Computation of Investment Income Percentage
17
Investment income percentage for 2021 (line 10c, column (f), divided by line 13, column (f)) . . .
18
Investment income percentage from 2020 Schedule A, Part III, line 17
19a
331/3% support tests—2021. If the organization did not check the box on line 14, and line 15 is more than 331/3%, and line
17 is not more than 331/3%, check this box and stop here. The organization qualifies as a publicly supported organization .
b331/3% support tests—2020. If the organization did not check a box on line 14 or line 19a, and line 16 is more than 331/3%, and
line 18 is not more than 331/3%, check this box and stop here. The organization qualifies as a publicly supported organization
20 Private foundation. If the organization did not check a box on line 14, 19a, or 19b, check this box and see instructions
Schedule A (Form 990) 2021Page 4
Part IV Supporting Organizations
(Complete only if you checked a box in line 12 on Part I. If you checked box 12a, Part I, complete Sections A and B. If you checked box 12b, Part I, complete Sections A and C. If you checked box 12c, Part I, complete Sections A, D, and E. If you checked box 12d, Part I, complete Sections A and D, and complete Part V.)
Section A. All Supporting Organizations
1Are all of the organization’s supported organizations listed by name in the organization’s governing documents? If “No,” describe in Part VI how the supported organizations are designated. If designated by class or purpose, describe the designation. If historic and continuing relationship, explain.
2Did the organization have any supported organization that does not have an IRS determination of status under section 509(a)(1) or (2)? If “Yes,” explain in Part VI how the organization determined that the supported organization was described in section 509(a)(1) or (2).
3a Did the organization have a supported organization described in section 501(c)(4), (5), or (6)? If “Yes,” answer lines 3b and 3c below.
bDid the organization confirm that each supported organization qualified under section 501(c)(4), (5), or (6) and satisfied the public support tests under section 509(a)(2)? If “Yes,” describe in Part VI when and how the organization made the determination.
cDid the organization ensure that all support to such organizations was used exclusively for section 170(c)(2)(B) purposes? If “Yes,” explain in Part VI what controls the organization put in place to ensure such use.
4a Was any supported organization not organized in the United States (“foreign supported organization”)? If “Yes,” and if you checked box 12a or 12b in Part I, answer lines 4b and 4c below.
bDid the organization have ultimate control and discretion in deciding whether to make grants to the foreign supported organization? If “Yes,” describe in Part VI how the organization had such control and discretion despite being controlled or supervised by or in connection with its supported organizations.
cDid the organization support any foreign supported organization that does not have an IRS determination under sections 501(c)(3) and 509(a)(1) or (2)? If “Yes,” explain in Part VI what controls the organization used to ensure that all support to the foreign supported organization was used exclusively for section 170(c)(2)(B) purposes.
5a Did the organization add, substitute, or remove any supported organizations during the tax year? If “Yes,” answer lines 5b and 5c below (if applicable). Also, provide detail in Part VI, including (i) the names and EIN numbers of the supported organizations added, substituted, or removed; (ii) the reasons for each such action;
(iii)the authority under the organization’s organizing document authorizing such action; and (iv) how the action was accomplished (such as by amendment to the organizing document).
bType I or Type II only. Was any added or substituted supported organization part of a class already designated in the organization’s organizing document?
cSubstitutions only. Was the substitution the result of an event beyond the organization’s control?
6Did the organization provide support (whether in the form of grants or the provision of services or facilities) to anyone other than (i) its supported organizations, (ii) individuals that are part of the charitable class benefited by one or more of its supported organizations, or (iii) other supporting organizations that also support or benefit one or more of the filing organization’s supported organizations? If “Yes,” provide detail in Part VI.
7Did the organization provide a grant, loan, compensation, or other similar payment to a substantial contributor (as defined in section 4958(c)(3)(C)), a family member of a substantial contributor, or a 35% controlled entity with regard to a substantial contributor? If “Yes,” complete Part I of Schedule L (Form 990).
8Did the organization make a loan to a disqualified person (as defined in section 4958) not described on line 7? If “Yes,” complete Part I of Schedule L (Form 990).
9a Was the organization controlled directly or indirectly at any time during the tax year by one or more disqualified persons, as defined in section 4946 (other than foundation managers and organizations described in section 509(a)(1) or (2))? If “Yes,” provide detail in Part VI.
bDid one or more disqualified persons (as defined on line 9a) hold a controlling interest in any entity in which the supporting organization had an interest? If “Yes,” provide detail in Part VI.
cDid a disqualified person (as defined on line 9a) have an ownership interest in, or derive any personal benefit from, assets in which the supporting organization also had an interest? If “Yes,” provide detail in Part VI.
10a Was the organization subject to the excess business holdings rules of section 4943 because of section 4943(f) (regarding certain Type II supporting organizations, and all Type III non-functionally integrated supporting organizations)? If “Yes,” answer line 10b below.
bDid the organization have any excess business holdings in the tax year? (Use Schedule C, Form 4720, to determine whether the organization had excess business holdings.)
Yes No
1
2
3a
3b
3c
4a
4b
4c
5a
5b
5c
6
9a
9b
9c
10b
Page 5
Part IV
Supporting Organizations (continued)
11Has the organization accepted a gift or contribution from any of the following persons?
aA person who directly or indirectly controls, either alone or together with persons described on lines 11b and 11c below, the governing body of a supported organization?
bA family member of a person described on line 11a above?
cA 35% controlled entity of a person described on line 11a or 11b above? If “Yes” to line 11a, 11b, or 11c, provide detail in Part VI.
Section B. Type I Supporting Organizations
11a
11b
11c
1Did the governing body, members of the governing body, officers acting in their official capacity, or membership of one or more supported organizations have the power to regularly appoint or elect at least a majority of the organization’s officers, directors, or trustees at all times during the tax year? If “No,” describe in Part VI how the supported organization(s) effectively operated, supervised, or controlled the organization’s activities. If the organization had more than one supported organization, describe how the powers to appoint and/or remove officers, directors, or trustees were allocated among the supported organizations and what conditions or restrictions, if any, applied to such powers during the tax year.
2Did the organization operate for the benefit of any supported organization other than the supported organization(s) that operated, supervised, or controlled the supporting organization? If “Yes,” explain in Part VI how providing such benefit carried out the purposes of the supported organization(s) that operated, supervised, or controlled the supporting organization.
Section C. Type II Supporting Organizations
1Were a majority of the organization’s directors or trustees during the tax year also a majority of the directors or trustees of each of the organization’s supported organization(s)? If “No,” describe in Part VI how control or management of the supporting organization was vested in the same persons that controlled or managed the supported organization(s).
Section D. All Type III Supporting Organizations
1Did the organization provide to each of its supported organizations, by the last day of the fifth month of the organization’s tax year, (i) a written notice describing the type and amount of support provided during the prior tax year, (ii) a copy of the Form 990 that was most recently filed as of the date of notification, and (iii) copies of the organization’s governing documents in effect on the date of notification, to the extent not previously provided?
2Were any of the organization’s officers, directors, or trustees either (i) appointed or elected by the supported organization(s) or (ii) serving on the governing body of a supported organization? If “No,” explain in Part VI how the organization maintained a close and continuous working relationship with the supported organization(s).
3By reason of the relationship described on line 2, above, did the organization’s supported organizations have a significant voice in the organization’s investment policies and in directing the use of the organization’s income or assets at all times during the tax year? If “Yes,” describe in Part VI the role the organization’s supported organizations played in this regard.
Section E. Type III Functionally Integrated Supporting Organizations
3
1Check the box next to the method that the organization used to satisfy the Integral Part Test during the year (see instructions).
a The organization satisfied the Activities Test. Complete line 2 below.
b The organization is the parent of each of its supported organizations. Complete line 3 below.
c The organization supported a governmental entity. Describe in Part VI how you supported a governmental entity (see instructions).
2 Activities Test. Answer lines 2a and 2b below.
aDid substantially all of the organization’s activities during the tax year directly further the exempt purposes of the supported organization(s) to which the organization was responsive? If “Yes,” then in Part VI identify those supported organizations and explain how these activities directly furthered their exempt purposes, how the organization was responsive to those supported organizations, and how the organization determined
that these activities constituted substantially all of its activities.
bDid the activities described on line 2a, above, constitute activities that, but for the organization’s involvement, one or more of the organization’s supported organization(s) would have been engaged in? If “Yes,” explain in Part VI the reasons for the organization’s position that its supported organization(s) would
have engaged in these activities but for the organization’s involvement.
3Parent of Supported Organizations. Answer lines 3a and 3b below.
aDid the organization have the power to regularly appoint or elect a majority of the officers, directors, or
trustees of each of the supported organizations? If “Yes” or “No,” provide details in Part VI.
b Did the organization exercise a substantial degree of direction over the policies, programs, and activities of each
of its supported organizations? If “Yes,” describe in Part VI the role played by the organization in this regard.
Page 6
Part V
Type III Non-Functionally Integrated 509(a)(3) Supporting Organizations
1 Check here if the organization satisfied the Integral Part Test as a qualifying trust on Nov. 20, 1970 (explain in Part VI). See instructions. All other Type III non-functionally integrated supporting organizations must complete Sections A through E.
Section A—Adjusted Net Income
(A) Prior Year
(B) Current Year
(optional)
Net short-term capital gain
Recoveries of prior-year distributions
Other gross income (see instructions)
4
Add lines 1 through 3.
5
Depreciation and depletion
6Portion of operating expenses paid or incurred for production or collection of gross income or for management, conservation, or maintenance of
property held for production of income (see instructions)
Other expenses (see instructions)
Adjusted Net Income (subtract lines 5, 6, and 7 from line 4)
Section B—Minimum Asset Amount
1Aggregate fair market value of all non-exempt-use assets (see instructions for short tax year or assets held for part of year):
Average monthly value of securities
1a
b Average monthly cash balances
1b
Fair market value of other non-exempt-use assets
1c
d Total (add lines 1a, 1b, and 1c)
1d
eDiscount claimed for blockage or other factors (explain in detail in Part VI):
Acquisition indebtedness applicable to non-exempt-use assets
Subtract line 2 from line 1d.
4Cash deemed held for exempt use. Enter 0.015 of line 3 (for greater amount,
see instructions).
Net value of non-exempt-use assets (subtract line 4 from line 3)
Multiply line 5 by 0.035.
Minimum Asset Amount (add line 7 to line 6)
Section C—Distributable Amount
Current Year
Adjusted net income for prior year (from Section A, line 8, column A)
Enter 0.85 of line 1.
Minimum asset amount for prior year (from Section B, line 8, column A)
Enter greater of line 2 or line 3.
Income tax imposed in prior year
6Distributable Amount. Subtract line 5 from line 4, unless subject to
emergency temporary reduction (see instructions).
7 Check here if the current year is the organization’s first as a non-functionally integrated Type III supporting organization (see instructions).
Page 7
Type III Non-Functionally Integrated 509(a)(3) Supporting Organizations (continued)
Section D—Distributions
Amounts paid to supported organizations to accomplish exempt purposes
Amounts paid to perform activity that directly furthers exempt purposes of supported
organizations, in excess of income from activity
Administrative expenses paid to accomplish exempt purposes of supported organizations
Amounts paid to acquire exempt-use assets
Qualified set-aside amounts (prior IRS approval required—provide details in Part VI)
Other distributions (describe in Part VI). See instructions.
Total annual distributions. Add lines 1 through 6.
Distributions to attentive supported organizations to which the organization is responsive
(provide details in Part VI). See instructions.
Distributable amount for 2021 from Section C, line 6
Line 8 amount divided by line 9 amount
(i)
(ii)
(iii)
Section E—Distribution Allocations
Underdistributions
Distributable
Excess Distributions
Pre-2021
Amount for 2021
Underdistributions, if any, for years prior to 2021
(reasonable cause required—explain in Part VI). See
instructions.
Excess distributions carryover, if any, to 2021
From 2016
From 2017
From 2018
From 2019
e
From 2020
f
Total of lines 3a through 3e
g
Applied to underdistributions of prior years
h
Applied to 2021 distributable amount
i
Carryover from 2016 not applied (see instructions)
j
Remainder. Subtract lines 3g, 3h, and 3i from line 3f.
Distributions for 2021 from
Section D, line 7:
$
Remainder. Subtract lines 4a and 4b from line 4.
Remaining underdistributions for years prior to 2021, if
any. Subtract lines 3g and 4a from line 2. For result
greater than zero, explain in Part VI. See instructions.
Remaining underdistributions for 2021. Subtract lines 3h
and 4b from line 1. For result greater than zero, explain in
Part VI. See instructions.
Excess distributions carryover to 2022. Add lines 3j
and 4c.
Breakdown of line 7:
Excess from 2017 . . .
Excess from 2018 . . .
Excess from 2019 . . .
Excess from 2020 . . .
Excess from 2021 . . .
Page 8
Part VI
Supplemental Information. Provide the explanations required by Part II, line 10; Part II, line 17a or 17b; Part
III, line 12; Part IV, Section A, lines 1, 2, 3b, 3c, 4b, 4c, 5a, 6, 9a, 9b, 9c, 11a, 11b, and 11c; Part IV, Section
B, lines 1 and 2; Part IV, Section C, line 1; Part IV, Section D, lines 2 and 3; Part IV, Section E, lines 1c, 2a, 2b,
3a, and 3b; Part V, line 1; Part V, Section B, line 1e; Part V, Section D, lines 5, 6, and 8; and Part V, Section E,
lines 2, 5, and 6. Also complete this part for any additional information. (See instructions.)
Filling out the IRS Schedule A (Form 990 or 990-EZ) is a crucial step for many tax-exempt organizations, ensuring they meet public support qualification norms. This task, although intricate, can be simplified into manageable steps. The form examines your organization's revenue sources, verifying adherence to public support criteria essential for maintaining tax-exempt status. Attention to detail and accurate reporting will secure your organization's compliance and uphold its commitment to transparency.
By methodically following these steps, organizations can accurately complete Schedule A, showcasing their commitment to transparency and adherence to IRS guidelines. This process, while detailed, reinforces the importance of public support in maintaining tax-exempt status, underlining the role of meticulous financial documentation and reporting in achieving organizational transparency and accountability.
What is the purpose of the IRS Schedule A 990 or 990-EZ form?
Schedule A (Form 990 or 990-EZ) is a tax form used by the Internal Revenue Service in the United States. It's designed for organizations exempt from income tax under section 501(c)(3) and certain 501(c)(4) organizations to provide additional information about their public charity status and public support. The form acts as a support document to the main Form 990 or 990-EZ, helping to demonstrate that the organization meets the public support criteria necessary to maintain its tax-exempt status.
Who needs to file Schedule A (Form 990 or 990-EZ)?
Organizations that have obtained tax-exempt status under sections 501(c)(3) and certain 501(c)(4) organizations are required to file Schedule A alongside their Form 990 or Form 990-EZ. This requirement includes charities, religious organizations, educational institutions, and other qualifying nonprofits. The filing helps these organizations provide the IRS with necessary details about their funding sources and activities to confirm their public support status.
What kind of information does Schedule A (Form 990 or 990-EZ) require?
Schedule A requires extensive details about an organization's sources of revenue and support over a five-year period. This includes both public support (donations from the general public, government agencies, and other public entities) and revenue from activities related to the organization's tax-exempt purpose. It also asks for information on any support not considered public, such as significant contributions from single donors, to ensure the organization doesn't rely too heavily on a limited number of sources.
How does an organization determine its public support percentage?
The public support percentage is calculated using a formula that compares an organization's public support (gifts, grants, contributions, membership fees) to its total support, which includes all revenue received. Organizations are considered to maintain their public charity status if they meet the one-third support test, meaning more than 33.3% of their support over a five-year period comes from public or governmental sources, not including gross investment income and unrelated business taxable income.
Are there penalties for failing to file Schedule A (Form 990 or 990-EZ)?
Yes, organizations that fail to file their required Form 990 or 990-EZ, including Schedule A, for three consecutive years will automatically lose their tax-exempt status. Beyond this significant implication, failing to file can also lead to financial penalties, calculated based on the organization's gross receipts and the duration of the filing delay, emphasizing the importance of timely and accurate filings.
Can an organization file Schedule A (Form 990 or 990-EZ) electronically?
Absolutely. Schedule A, along with Form 990 or 990-EZ, can be filed electronically through the IRS e-filing system. Many organizations find e-filing more convenient and efficient, and it reduces the likelihood of errors since the electronic system checks for common mistakes and omissions. The IRS encourages electronic filing, and in some cases, it's required, depending on the organization's gross receipts and assets.
Filling out the IRS Schedule A of the 990 or 990-EZ form is a crucial task for many nonprofit organizations, tasked with maintaining their tax-exempt status. A common mistake people make is not thoroughly reading the instructions before starting. This step is vital, as it lays down the groundwork and provides clarification for many parts of the form that might seem confusing at first glance. Skipping this initial step can lead to misunderstandings and errors down the line.
Another error that frequently happens is incorrect classification of the organization. The Schedule A categorizes organizations based on their type and public support calculation. Misclassification can not only impact the way an organization fills out the rest of the form but can also affect their tax-exempt status. Therefore, it's crucial to understand where your organization stands in these categories.
Many also overlook the importance of accurately calculating public support. This calculation is essential to determine whether an organization meets the public support test. An incorrect calculation can lead to the wrong conclusion about an organization's public support status, potentially endangering its tax-exempt status.
Failure to properly report all revenue sources is another common issue. The IRS requires detailed information on both the amounts and sources of public support. Organizations sometimes report only their largest sources of support, omitting smaller ones, which could provide a skewed picture of their financial health and sources of support.
Not attaching necessary schedules or documentation can also lead to complications. Certain parts of the form require additional documentation or supplemental schedules. Forgetting to include these can trigger inquiries from the IRS or even lead to an audit.
Some organizations make the mistake of not reviewing past year's filings before starting the new one. This review can help ensure consistency in reporting and identify any past errors that need correction. It also aids in maintaining a coherent financial story over the years.
A mistake that can easily go unnoticed is failing to update the organization's address or contact information. If the IRS needs to reach out for any reason and the information is outdated, it could delay the process and, in worst-case scenarios, impact the organization’s status.
Another common misstep is inaccurately filling out the form due to misunderstanding the terminology used. Tax forms, including the Schedule A, use very specific language. Misinterpreting these terms can lead to errors in how an organization represents its activities and finances.
Lastly, many fail to seek professional advice when faced with uncertainties. While it's tempting to figure things out independently, the complexity of tax forms often warrants professional guidance. Not seeking help can result in mistakes that have financial and legal repercussions for the organization.
In summary, careful attention to detail and an understanding of the form’s requirements are essential when completing the IRS Schedule A 990 or 990-EZ. Avoiding these common mistakes can help ensure the process goes smoothly and the organization remains in good standing with the IRS.
Completing the IRS Schedule A (990 or 990-EZ) is a critical step for certain tax-exempt organizations to maintain their exemption status. However, this form doesn't exist in isolation. Various other forms and documents are often required alongside Schedule A to provide a comprehensive view of an organization's financial and operational status. These complementing documents capture everything from financial details to governance policies, ensuring organizations meet full compliance with tax laws. Below is a list of nine such forms and documents typically used with the IRS Schedule A (990 or 990-EZ).
Each of these forms and documents plays a unique role in the life of a tax-exempt organization, ensuring it operates in accordance with the law and maintains its exempt status. Together with IRS Schedule A (990 or 990-EZ), these documents form a comprehensive package that showcases an organization's commitment to transparency, accountability, and compliance. Whether you are preparing for annual filing or seeking tax-exempt status, understanding these forms and their purposes can significantly streamline the process.
The IRS Schedule A 990 or 990-EZ form shares similarities with the IRS Form 1023. Both documents are crucial for organizations seeking to establish themselves as tax-exempt entities under Section 501(c)(3) of the Internal Revenue Code. While Schedule A serves as a supplement for organizations to report their public support status annually, Form 1023 is the initial application that an organization files to be recognized as a tax-exempt entity. Both require detailed financial information and descriptions of the organization's activities, governance structure, and revenue sources to ensure compliance with the criteria for tax-exempt status.
Another document that bears resemblance to the IRS Schedule A 990 or 990-EZ is the IRS Form 1065, which is used by partnerships for tax filings. Although it is designed for profit-oriented entities, Form 1065 also requires detailed reporting of income, deductions, gains, losses, and more, akin to the financial disclosures on Schedule A. Both forms demand transparency about the financial operations of the entity, aiming to ensure accurate accounting of funds for tax purposes.
Form 990-PF is also akin to the IRS Schedule A in that it is specifically used by private foundations, which are a subset of 501(c)(3) organizations. This form demands comprehensive financial information, including contributions received, assets held, and grants given. Similar to Schedule A, Form 990-PF plays a vital role in maintaining the public's trust in charitable organizations by requiring detailed disclosures about their financial health and activities.
The IRS Form 1041, used by estates and trusts to report income, closely aligns with parts of the Schedule A 990 or 990-EZ form. Both documents require the disclosing of income and allowable deductions. While their purposes differ—Form 1041 is for fiduciaries to show how income was allocated among beneficiaries—they share the objective of clear financial reporting to the IRS.
Another form with similarities to the IRS Schedule A 990 or 990-EZ is the Form 990-N, also known as the e-Postcard. This is applicable for small tax-exempt organizations whose gross receipts are typically $50,000 or less. While Schedule A is more detailed and used by larger nonprofits to provide extensive information about their finances, both forms adhere to the principle of maintaining transparency with the IRS about an organization's activities and financial status.
Last but not least, the IRS Form 8822-B bears similarities to Schedule A 990 or 990-EZ in that it involves reporting changes to the IRS but from a different angle. Form 8822-B is used by organizations to report a change of address or the identity of their responsible party. While it does not delve into the financial details as Schedule A does, it ensures the IRS has current information, facilitating effective communication and compliance monitoring, reflecting the overarching goal of transparent and up-to-date organizational reporting.
Filling out the IRS Schedule A for Form 990 or 990-EZ is crucial for tax-exempt organizations. It details the public support test that determines whether an organization qualifies as publicly supported. Attention to detail and accuracy are paramount in completing this form to maintain your organization’s tax-exempt status. Below are essential do's and don'ts to consider.
Do's when filling out the IRS Schedule A 990 or 990-EZ form:
Don'ts when filling out the IRS Schedule A 990 or 990-EZ form:
Filing tax forms can be a daunting process, especially when dealing with specialized forms like the IRS Schedule A for Form 990 or 990-EZ, used by tax-exempt organizations. Misunderstandings about these forms can lead to errors that might affect an organization's tax-exempt status. Here are seven common misconceptions about these forms and clarifications to help organizations navigate their filing obligations more effectively.
Understanding these key aspects of the IRS Schedule A for Form 990 or 990-EZ can help organizations ensure accurate reporting and maintain good standing with tax authorities. It also underscores the importance of comprehensive record-keeping and a solid grasp of tax obligations specific to tax-exempt organizations.
The IRS Schedule A form, associated with either the 990 or 990-EZ filings, is an essential document for certain tax-exempt organizations. Its completion is crucial for maintaining the status of the organization and providing transparency about its operations. Here are key takeaways regarding filling out and utilizing this form:
Adherence to these takeaways when filling out and using the IRS Schedule A form can significantly contribute to the accuracy, compliance, and effectiveness of the organization's tax-exempt status reporting.
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