“Has the organization provided a complete copy of this Form 990 to all members of its governing body before filing the form?” The Internal Revenue Service (IRS) began asking nonprofits this question as part of the 2008 redesign of the Form 990, Return of Organization Exempt from Income Tax (the 990). As a result, nonprofit Boards have become increasingly interested in reviewing their organizations’ 990s.
However, many Board members find the 990 to be a daunting document. The form is a combination of tax compliance, accounting, governance, and marketing information. As a result, Board members can quickly become frustrated in their attempts to effectively identify and review the important items on the 990.
In particular, the Form 990 for 501(c)(3) organizations can be especially challenging to review. 501(c)(3) entities are subject to even more stringent tax compliance requirements than many other types of tax-exempt entities.
As a result, we have created a high-level review checklist to assist 501(c)(3) entity Board members as they review the Form 990. The checklist can be accessed here:
Naturally, many aspects of the Form 990 are nuanced, and often, “The devil truly is in the details.” So, this checklist is meant only as a general guide. When in doubt, be sure to consult a qualified tax professional regarding questions that arise during the review process.
Doug Boedeker, CPA, CMA, is a partner in the Firm’s audit and assurance services practice and can be reached at [email protected].