Department of the Treasury 2008 Internal Revenue Service

Instructions for Form 990-EZ

Short Form Return of Organization Exempt From Income Tax Under Section

501(c), 527, or 4947(a)(1) of the Internal Revenue Code

(except black lung benefit trust or private foundation)

Section references are to the Internal Revenue Code unless Filing amounts. The gross receipts and total assets amounts

otherwise noted. for Form 990-EZ filers have been raised. Beginning with the

2008 tax year, an organization may file a Form 990-EZ (rather Contents Page than a Form 990) if it satisfies both the gross receipts and total • What’s New ..................................1 assets tests set forth in this table. • Purpose of Form ...............................2

• Phone Help ..................................2 May file 990-EZ for: If gross receipts are: And if total assets • Email Subscription .............................2 are: • Photographs of Missing Children ...................2

2008 tax year (filed in < $1 million < $2.5 million • General Instructions ............................2

2009) A Who Must File ..............................3

B Organizations Not Required to File Form 990 or 2009 tax year (filed in < $500,000 < $1.25 million

Form 990-EZ ................................4 2010)

C Accounting Periods and Methods .................4 2010 and later tax years < $200,000 < $500,000 D When, Where, and How To File ..................5

E Extension of Time To File ......................5

F Amended Return/Final Return ...................5 Replacement of Schedule A with new Part VI and

G Failure-to-File Penalties ........................5 schedules. For 2008, many parts of the 2007 Schedule A

H Requirements for a Properly Completed Form have been moved to new schedules or to the Form 990 core

990-EZ .....................................6 form, which required that corresponding changes be made to

• Specific Instructions for Form 990-EZ ................7 Form 990-EZ. For 2008, Part VI of Form 990-EZ was added to

Completing the Heading of Form 990-EZ .............7 maintain reporting of information previously required of

 Part I. Revenue, Expenses, and Changes in Net organizations that filed a Form 990-EZ and completed Schedule

Assets or Fund Balances A. ........................8 • Line 47 – for determining which section 501(c)(3) Part II. Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . 14

organizations are required to complete Schedule C, Part II, Part III. Statement of Program Service regarding lobbying activities (2007 Schedule A, Part VI-A and Accomplishments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 VI-B). Part IV. List of Officers, Directors, Trustees, and • Line 48 – for determining which section 501(c)(3) schools Key Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 are required to complete Schedule E regarding private schools Part V. Other Information . . . . . . . . . . . . . . . . . . . . . . . 16 (2007 Schedule A, Part V). Part VI. Section 501(c)(3) Organizations Only . . . . . . . . 20 • Lines 49a and 49b – added to identify transactions between Signature Block . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 section 501(c)(3) organizations and tax-exempt organizations • Appendix of Special Instructions to Form 990-EZ other than section 501(c)(3) organizations (2007 Schedule A, Content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Part VII). However, 990-EZ filers are no longer required to A Exempt Organizations Reference Chart . . . . . . . . . . . 23 provide the details of such transactions. B How to Determine Whether an Organization’s • Line 50 – added to report compensation of the five highest Gross Receipts Are Normally $25,000 (or $5,000) compensated employees other than officers, directors, trustees,

or Less . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 and key employees (2007 Schedule A, Part I); threshold raised

C Special Gross Receipts Test for Determining from $50,000 to $100,000.

Exempt Status of Section 501(c)(7) and 501(c)(15) • Line 51 – added to report compensation of five highest

Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 compensated independent contractors (2007 Schedule A, Parts

D Public Inspection of Returns . . . . . . . . . . . . . . . . . . . 25 II-A and II-B); threshold raised from $50,000 to $100,000.

E Section 4958 Excess Benefit Transactions . . . . . . . . . 29 Replacement of certain attachments with new schedules. F Forms and Publications to File or Use . . . . . . . . . . . . . 32 Certain unstructured attachments required in the 2007 Form G Use of Form 990 or Form 990-EZ To Satisfy State 990-EZ were replaced with schedules or eliminated. Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . 34 • Part I. Revenue, Expenses, and Changes in Net Assets or • Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Fund Balances:

• Line 5c – eliminated the attached schedule for sales of

non-inventory assets and

What’s New • Line 6a – replaced attached schedule with Parts II and

Form 990 has been extensively redesigned for 2008. The 2008 III of Schedule G when gross revenue from special events

Form 990-EZ has few changes. The dollar thresholds for Form and gaming activities exceeds $15,000.

990-EZ filers have been raised to allow many more • Part V. Other Information:

organizations to file Form 990-EZ. Several new lines have been • Line 36 – replaced attached schedule with Schedule N,

added that reflect the revision of Schedule A (Form 990 or • Line 38a – replaced attached schedule with Schedule L,

990-EZ). Several unstructured attachments have been replaced Part II, and

by schedules or eliminated. Some instructions have been • Line 40b – replaced attached schedule with Schedule L,

changed in coordination with new Form 990 instructions. Part I.

Cat. No. 64888C
Other changes to lines.

Line 33—rephrased CAUTION

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Lines 44 and 45– added to remind sponsoring organizations 1. For the tax year beginning in 2008, Form 990-EZ may be of donor advised funds, and certain section 512(b)(13) filed by organizations with gross receipts of less than controlling organizations, that they must file Form 990 instead $1,000,000 and total assets of less than $2,500,000 at the end of Form 990-EZ (see instructions to lines 44 and 45). of their tax year.

Line 46 – for determining which section 501(c)(3) 2. Sponsoring organizations of donor advised funds and

organizations are required to complete Schedule C, Part I, certain controlling organizations defined in section 512(b)(13)

regarding political activities. must file Form 990 rather than Form 990-EZ regardless of the

amount of their gross receipts and total assets. See Instructions Significant changes to instructions. The Form 990-EZ for Form 990-EZ, lines 44 and 45, and General Instruction A, instructions are no longer combined with the Form 990 before completing this form. instructions, although the General Instructions and Appendix of 3. Form 990-EZ may not be used by a private foundation Special Instructions are nearly the same for both forms. required to file Form 990-PF, Return of Private Foundation or

Several of the General Instructions were moved to the Section 4947(a)(1) Nonexempt Charitable Trust Treated as a

Appendix or eliminated. Private Foundation. A section 501(c)(3) or 4947(a)(1)

organization should refer to the Instructions for Schedule A Use of other forms such as Form LM-2 and LM-3 as a (Form 990 or 990-EZ) to determine whether it is a private substitute for financial reporting on Form 990-EZ or Form 990 is foundation. eliminated. 4. Form 990 must be used to file a group return, not Form

The instructions clarify that organizations that claim 990-EZ. See General Instruction A.

tax-exempt status but have not yet applied for or been

recognized as exempt must file Form 990-EZ or Form 990. See Phone Help

General Instruction A. If you have questions and/or need help completing Form 990 or

Form 990-EZ, please call 1-877-829-5500. This toll-free Amended Form 990-EZ returns now require an attachment telephone service is available Monday through Friday. describing the amendments. See General Instruction F.

The attached schedule for grants now has a $5,000 Email Subscription

threshold per grantee, and no longer requires the names of The IRS has established a new subscription-based email grantee individuals. See line 10 instruction. service for tax professionals and representatives of tax-exempt

organizations. Subscribers will receive periodic updates from Organizations may choose one of two methods (Option 1 or the IRS regarding exempt organization tax law and regulations, Option 2) of reporting compensation of their officers, directors, available services, and other information. To subscribe, visit trustees, key employees, and five highest compensated www.irs.gov/eo. employees. Option 1 is a simplified version of the new 2008

Form 990 method of compensation reporting (for example, an Photographs of Missing Children organization filing Form 990-EZ that chooses Option 1 need not

complete Schedule J, which may be required for an The Internal Revenue Service is a proud partner with the

organization that completes Form 990). Option 1 requires National Center for Missing and Exploited Children.

calendar-year compensation reporting and is based on Form Photographs of missing children selected by the Center may

W-2 and Form 1099-MISC reporting. Option 2 is essentially the appear in instructions on pages that would otherwise be blank.

2007 Form 990-EZ method of compensation reporting. You can help bring these children home by looking at the

Whichever method the organization selects for 2008 must be photographs and calling 1-800-THE-LOST (1-800-843-5678) if

used consistently for all officers, directors, trustees, key you recognize a child.

employees, and five highest compensated employees, and

must be consistently applied for all tax years beginning with

2008. General Instructions

Overview of Form 990-EZ. The Form 990-EZ is an annual Purpose of Form information return required to be filed with the IRS by many

Form 990 and Form 990-EZ are used by tax-exempt organizations exempt from income tax under Internal Revenue organizations, nonexempt charitable trusts, and section 527 Code section 501(a), and certain political organizations and political organizations to provide the IRS with the information nonexempt charitable trusts. Parts I through VI of the form must required by section 6033. be completed by all filing organizations, and require reporting

on the organization’s exempt and other activities, finances, An organization’s completed Form 990, or Form 990-EZ, is compliance with certain federal tax filings and requirements, available for public inspection as required by section 6104. and compensation paid to certain persons. Additional schedules Schedule B, Schedule of Contributors, is open for public are required to be completed depending upon the activities and inspection for section 527 organizations filing Form 990 or Form type of organization. The completed Form 990-EZ filed with the 990-EZ. For other organizations that file Form 990 or Form IRS, except for certain contributor information on Schedule B 990-EZ, parts of Schedule B may be open to public inspection. (Schedule of Contributors), is required to be made available to For more details see the Instructions for Schedule B (Form 990, the public by the IRS and the filing organization. Also, the 990-EZ, or 990-PF), Schedule of Contributors. organization may be required to file the completed Form

Some members of the public rely on Form 990, or Form 990-EZ with state governments to satisfy state reporting

990-EZ, as the primary or sole source of information about a requirements.

particular organization. How the public perceives an

organization in such cases may be determined by the Organizations that have total gross income from

information presented on its return. Therefore, the return must unrelated trades or businesses of at least $1,000 also

be complete, accurate, and fully describe the organization’s CAUTION are required to file Form 990-T, Exempt Organization

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programs and accomplishments. Business Income Tax Return, in addition to any required Form

990, 990-EZ, or 990-N. Use Form 990 or Form 990-EZ to send a required election to

the IRS, such as the election to capitalize costs under section Helpful Hints. The following hints may help you more

266. efficiently review these instructions and complete the form.

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1. Throughout these instructions, “the organization” and the May file 990-EZ for: If gross receipts are: And if total assets

“filing organization” both refer to the organization filing the Form are:

990-EZ. 2008 Form (generally < $1,000,000 < $2,500,000 2. The examples appearing throughout the Form 990-EZ filed in 2009) Instructions are illustrative only and for the purpose of

completing this Form, but are not all-inclusive. 2009 Form (generally < $500,000 < $1,250,000

3. Instructions to the Form 990-EZ Schedules are published filed in 2010)

separately from these instructions. 2010 and later Forms < $200,000 < $500,000

A. Who Must File Foreign and U.S. Possession organizations. Foreign Most organizations exempt from income tax under section organizations and U.S. Possession organizations as well as 501(a) must file an annual information return (Form 990 or domestic organizations described above must file Form 990 or Form 990-EZ) or an annual electronic notice (Form 990-N), 990-EZ unless specifically excepted under General Instruction depending upon the organization’s gross receipts and total B. Report amounts in U.S. dollars, and state what conversion

assets. rate the organization uses. Combine amounts from within and

outside the U.S., and report the total for each item. All For tax years beginning in 2008, if an organization has gross information must be written in English. receipts less than $1,000,000 and total assets at the end of the Sponsoring organizations of donor advised funds. year less than $2,500,000, it may choose to file Form 990-EZ, Sponsoring organizations of donor advised funds, if required to Short Form Return of Organization Exempt From Income Tax, file an annual information return for the year, must file Form 990 instead of Form 990. See the instructions below for more and not Form 990-EZ. See line 44 and the related instructions. information. But see the special rules in Controlling

organizations described in section 512(b)(13) on this page, and Controlling organizations described in section 512(b)(13).

Sponsoring organizations of donor advised funds, on this page. A controlling organization of one or more controlled entities, as

described in section 512(b)(13), must file Form 990 and not

For 2008, Form 990 (not 990-EZ or 990-N) must be filed by Form 990-EZ if it is required to file an annual information return

an organization exempt from income tax under section 501(a) for the year and if there was any transfer of funds between the

(including an organization that has not yet applied for controlling organization and any controlled entity during the

recognition of exemption) if it has either gross receipts greater year. See line 45 and the related instructions.

than or equal to $1,000,000 or total assets greater than or equal Section 509(a)(3) supporting organizations. A section to $2,500,000 at the end of the tax year. This includes the 509(a)(3) supporting organization must file Form 990 or following: 990-EZ, even if its gross receipts are normally $25,000 or less, • organizations described in section 501(c)(3) (other than unless it qualifies as one of the following: private foundations) and 1. An integrated auxiliary of a church, • organizations described in other section 501(c) subsections 2. The exclusively religious activities of a religious order, (other than black lung benefit trusts). 3. A religious organization whose gross receipts are

Gross receipts. Gross receipts are the total amounts the normally not more than $5,000,

organization received from all sources during its annual 4. An organization whose gross receipts are normally not

accounting period, without subtracting any costs or expenses. more than $5,000 that supports a section 501(c)(3) religious

See Appendix B for a discussion of gross receipts. Total assets organization or,

is the amount reported by the organization on its balance sheet 5. A charitable organization supported partly by funds

contributed by United States, state, or local governmental units, (Form 990-EZ, Part II, line 25, column (B)) as of the end of the

year, without reduction for liabilities. or primarily by contributions of the general public, whose gross

receipts are normally not more than $5,000.

For purposes of Form 990 or Form 990-EZ reporting, the If the organization is described in items 3, 4, or 5, then it term “section 501(c)(3)” includes organizations exempt under

sections 501(e) and (f) (cooperative service organizations), must file Form 990-N unless it voluntarily files Form 990 or

501(k) (child care organizations), and 501(n) (charitable risk Form 990-EZ.

pools). In addition, any organization described in one of these Section 501(c)(7) and section 501(c)(15) organizations. A

sections is also subject to section 4958 if it obtains a section 501(c)(7) or section 501(c)(15) organization applies the determination letter from the IRS stating that it is described in same gross receipts test as other organizations to determine section 501(c)(3). whether it must file the Form 990 or Form 990-EZ, but uses a

different definition of gross receipts to determine whether it Form 990-N. If an organization normally has gross receipts of qualifies as tax-exempt for the tax year. See Appendix C for $25,000 or less, it must file Form 990-N, Electronic Notice more information.

(e-Postcard) for Tax-Exempt Organizations not Required To Section 527 political organizations. Tax-exempt political File Form 990 or 990-EZ, if it chooses not to file Form 990 or organizations must file Form 990 or Form 990-EZ unless Form 990-EZ (with exceptions described below for certain excepted under General Instruction B. A qualified state or local section 509(a)(3) supporting organizations and for certain political organization must file Form 990 or Form 990-EZ only if organizations described in General Instruction B). See it has gross receipts of $100,000 or more. Political Appendix B. organizations are not required to file Form 990-N.

Electronic filing. Organizations may file Form 990-EZ Section 4947(a)(1) non-exempt charitable trusts. A

electronically. See General Instruction D for who must file non-exempt charitable trust described under section 4947(a)(1) electronically. of the Code (if it is not treated as a private foundation) is

required to file Form 990 or Form 990-EZ unless excepted

Form 990 (including its schedules) has been under General Instruction B. Such a trust is treated like an

substantially redesigned for 2008 and later tax years. exempt section 501(c)(3) organization for purposes of

The IRS has provided transitional relief to small and completing the form; all references to a section 501(c)(3)

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mid-size organizations, allowing many to file Form 990-EZ for organization shall include a section 4947(a)(1) trust (for

2008 and 2009 instead of Form 990, and providing them time to instance, such a trust must complete Schedule A, Public

become familiar with the new Form 990 and its requirements. Charity Status and Public Support), unless otherwise specified.

The following schedule sets forth the modified amounts for filing If such a trust does not have any taxable income under Subtitle

Form 990-EZ (instead of Form 990) during this transition period: A of the Code, it can file Form 990 or Form 990-EZ to meet its

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section 6012 filing requirement and does not have to file Form 11. A foreign organization, including organizations located in

1041, U.S. Income Tax Return for Estates and Trusts. U.S. Possessions, whose gross receipts from sources within

the U.S. are normally $25,000 or less. To determine what an Group returns. A group return filed by the central or parent organization’s gross receipts “normally” are, see Appendix B. organization on behalf of the subordinates in a group exemption

must be filed using Form 990, not Form 990-EZ. Certain organizations that file different kinds of annual

information returns

Returns when exempt status not established. An 12. A private foundation (including a private operating

organization is required to file Form 990 or 990-EZ in foundation) exempt under section 501(c)(3) and described in

accordance with these instructions if the organization claims section 509(a). Use Form 990-PF, Return of Private

exempt status under section 501(a) but has not yet established Foundation. Use Form 990-PF also for a taxable private

such exempt status by filing Form 1023 (Application for foundation, a section 4947(a)(1) nonexempt charitable trust

Recognition of Exemption Under Section 501(c)(3) of the treated as a private foundation, and a private foundation

Internal Revenue Code) or Form 1024 (Application for terminating its status by becoming a public charity under

Recognition of Exemption Under Section 501(a) or for section 507(b)(1)(B) for tax years within its 60-month

Determination Under Section 120) and receiving an IRS letter termination period. If the section 507(b)(1)(B) organization

recognizing exempt status. In such cases, the organization successfully terminates, then it files Form 990 or Form 990-EZ

must check the “application pending” checkbox in Item B of the in its final year of termination.

Form 990 or Form 990-EZ header (whether or not a Form 1023 13. A black lung benefit trust described in section 501(c)(21).

or Form 1024 has yet been filed) to indicate that the Form 990 Use Form 990-BL, Information and Initial Excise Tax Return for

or form 990-EZ is being filed in the belief that the organization is Black Lung Benefit Trusts and Certain Related Persons.

exempt under section 501(a). 14. A religious or apostolic organization described in section

501(d). Use Form 1065, U.S. Return of Partnership Income.

B. Organizations Not Required to File 15. A stock bonus, pension, or profit-sharing trust that

qualifies under section 401. Use Form 5500, Annual Return/

Form 990 or Form 990-EZ Report of Employee Benefit Plan.

For tax years beginning in 2008, an organization does not have

to file Form 990 or Form 990-EZ even if it has at least A public charity described in section 170(b)(1)(A)(iv) or $1,000,000 of gross receipts or $2,500,000 of total assets if it is (vi) or 509(a)(2) that is not within its initial five years of

described below (except for section 509(a)(3) supporting existence should first complete Part II or III of Schedule

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organizations described above). See General Instruction A for A (Public Charity Status and Public Support) to ensure that it

determining whether the organization may file Form 990-EZ continues to qualify as a public charity for the tax year. If it fails

instead of Form 990. An organization described in Item 10, 11, to qualify as a public charity, then it must file Form 990-PF

or 13 below is required to file Form 990-N unless it voluntarily rather than Form 990-EZ.

files Form 990, Form 990-EZ, or Form 990-BL.

Certain religious organizations C. Accounting Periods and Methods

1. A church, an interchurch organization of local units of a See IRS Publication 538, Accounting Periods and church, a convention or association of churches, or an Methods, about reporting changes to accounting periods integrated auxiliary of a church as described in Regulations and methods.

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section 1.6033-2(h) (such as a men’s or women’s organization,

religious school, mission society, or youth group).

2. A church-affiliated organization that is exclusively Accounting Periods

engaged in managing funds or maintaining retirement programs Calendar year. Use the 2008 Form 990-EZ to report on the and is described in Rev. Proc. 96-10, 1996-1 C.B. 577. 2008 calendar year accounting period. A calendar year 3. A school below college level affiliated with a church or accounting period begins on January 1 and ends on December operated by a religious order, as described in Regulations 31.

section 1.6033-2(g)(1)(vii).

4. A mission society sponsored by, or affiliated with, one or Fiscal year. If the organization has established a fiscal year

more churches or church denominations, if more than half of accounting period, use the 2008 Form 990-EZ to report on the

the society’s activities are conducted in, or directed at, persons organization’s fiscal year that began in 2008 and ended 12

in foreign countries. months later. A fiscal year accounting period should normally

5. An exclusively religious activity of any religious order coincide with the natural operating cycle of the organization. Be

described in Rev. Proc. 91-20. certain to indicate in the heading of Form 990-EZ the date the

organization’s fiscal year began in 2008 and the date the fiscal Certain governmental organizations year ended in 2009. 6. A state institution whose income is excluded from gross

income under section 115. Short period. A short accounting period is a period of less 7. A governmental unit or affiliate of a governmental unit than 12 months, which exists when an organization first described in Rev. Proc. 95-48, 1995-2 C.B. 418. commences operations, changes its accounting period, or 8. An organization described in section 501(c)(1). A section terminates. If the organization’s short year ended prior to 501(c)(1) organization is a corporation organized under an act December 31, 2008 (not on or after December 31, 2008), it may of Congress that is an instrumentality of the United States, and use the 2007 Form 990-EZ or Form 990 to file for such short

exempt from federal income taxes. year.

Certain political organizations Accounting period change. If the organization changes its 9. A political organization that is: accounting period, it must file a Form 990-EZ for the short • A state or local committee of a political party, period resulting from the change. Enter “Change of Accounting • A political committee of a state or local candidate, Period” at the top of this short-period return. • A caucus or association of state or local officials, or

• Required to report under the Federal Election Campaign If the organization previously changed its accounting period

Act of 1971 as a political committee (as defined in section within the 10-calendar-year period that includes the beginning

301(4) of such Act). of the short period, and it had a Form 990-EZ filing requirement

Certain organizations with limited gross receipts at any time during that 10-year period, it must also attach a

10. An organization whose gross receipts are normally Form 1128 (Application To Adopt, Change, or Retain a Tax

$25,000 or less. To determine what an organization’s gross Year) to the short-period return. See Rev. Proc. 85-58, 1985-2

receipts “normally” are, see Appendix B. C.B. 740.

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Accounting Methods “timely mailing as timely filing/paying” rule for tax return

payments. These private delivery services include only the Unless instructed otherwise, the organization should generally following: use the same accounting method on the return to report • DHL Express (DHL): DHL “Same Day” Service, DHL Next revenue and expenses that it regularly uses to keep its books Day 10:30 AM, DHL Next Day 12:00 PM, DHL Next Day 3:00 and records. To be acceptable for Form 990-EZ reporting PM, and DHL 2nd Day Service, purposes, however, the method of accounting must clearly • Federal Express (FedEx): FedEx Priority Overnight, FedEx reflect income. Standard Overnight, FedEx 2Day, FedEx International Priority, Accounting method change. Generally, the organization FedEx International First, and must file Form 3115 to change its accounting method. An • United Parcel Service (UPS): UPS Next Day Air, UPS Next exception applies where a section 501(c) organization changes Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air AM, UPS its accounting method to comply with SFAS 116, Accounting for Worldwide Express Plus, and UPS Worldwide Express. Contributions Received and Contributions Made. See Notice The private delivery service can tell you how to get written 96-30, 1996-1 C.B. 378. An organization that makes a change proof of the mailing date. in accounting method, regardless of whether it files Form 3115,

Application for Change in Accounting Method, and that has Electronic filing. The organization can file Form 990-EZ or

audited financial statements, must report any adjustment Form 990 and related forms, schedules, and attachments

required by section 481(a) on Form 990-EZ, line 20 (other electronically. However, if an organization files at least 250

changes in net assets or fund balances), as a net asset returns of any type during the calendar year and has total

adjustment made during the tax year. The organization must assets of $10 million or more at the end of the tax year, it must

attach an explanation of the change and net asset adjustment. file Form 990 electronically (and not Form 990-EZ). “Returns”

The adjustment must be identified as the effect of changing to for this purpose include information returns (for example, Forms

the method provided in SFAS 116. The beginning of year W-2, Forms 1099), income tax returns, employment tax returns

statement of financial position (balance sheet) should not be (including quarterly Forms 941), and excise tax returns.

restated to reflect any prior period adjustments. If an organization is required to file a return electronically but

State reporting. Most states that accept Form 990-EZ in place does not, the organization is considered not to have filed its

of their own forms require that all amounts be reported based return, even if a paper return is submitted. See Regulations

on the accrual method of accounting. If the organization section 301.6033-4 for more information.

prepares Form 990-EZ for state reporting purposes, it may file For additional information on the electronic filing an identical return with the IRS even though the return does not requirement, visit www.irs.gov/efile. agree with the books of account, unless the way one or more The IRS may waive the requirements to file electronically in items are reported on the state return conflicts with the cases of undue hardship. For information on filing a waiver, see instructions for preparing Form 990-EZ for filing with the IRS. Notice 2005-88, 2005-48 I.R.B. 1060. Example 1. The organization maintains its books on the

cash receipts and disbursements method of accounting but E. Extension of Time To File prepares a Form 990-EZ return for the state based on the Use Form 8868, Application for an Extension of Time To File an accrual method. It could use that return for reporting to the IRS. Exempt Organization Return to request an automatic 3-month Example 2. A state reporting requirement requires the extension of time to file. Use Form 8868 also to apply for an organization to report certain revenue, expense, or balance additional (not automatic) 3-month extension if the original 3 sheet items differently from the way it normally accounts for months was not enough time. To obtain this additional them on its books. A Form 990-EZ prepared for that state is extension of time to file, the organization must show reasonable acceptable for the IRS reporting purposes if the state reporting cause for the additional time requested. See the Instructions for requirement does not conflict with Form 990-EZ instructions. Form 8868.

An organization should keep a reconciliation of any

differences between its books of account and the Form 990-EZ F. Amended Return/Final Return

that is filed. To change the organization’s return for any year, file a new

return including any required schedules. Use the version of D. When, Where, and How to File Form 990-EZ applicable to the year being amended. The File Form 990-EZ by the 15th day of the 5th month after the amended return must provide all the information called for by organization’s accounting period ends (May 15 for a the form and instructions, not just the new or corrected calendar-year filer). If the regular due date falls on a Saturday, information. Check the Amended Return box in the heading of Sunday, or legal holiday, file on the next business day. A the return. Also, state in an attachment which parts and business day is any day that is not a Saturday, Sunday, or legal schedules of the Form 990-EZ were amended and describe the

holiday. amendments.

If the organization is liquidated, dissolved, or terminated, file The organization may file an amended return at any time to the return by the 15th day of the 5th month after liquidation, change or add to the information reported on a previously filed dissolution, or termination. return for the same period. It must make the amended return

If the return is not filed by the due date (including any available for inspection for 3 years from the date of filing or 3

extension granted), attach a statement giving the reason(s) for years from the date the original return was due, whichever is

not filing on time. later.

Send the return to the: Use Form 4506, Request for Copy of Tax Return, to obtain a

copy of the filing organization’s previously filed return. See Department of the Treasury www.irs.gov for information on getting blank tax forms. Internal Revenue Service Center

Ogden, UT 84201-0027 If the return is a final return, see the Specific Instructions for

Form 990-EZ, line 36 and Schedule N, Liquidation, Termination, Foreign and U.S. Possession organizations. If the Dissolution or Significant Disposition of Assets, for further organization’s principal business, office, or agency is located in details. a foreign country or U.S. Possession, send the return to the: Amended returns and state filing considerations. State law

Internal Revenue Service Center may require that the organization send a copy of an amended P.O. Box 409101 Form 990-EZ return (or information provided to the IRS Ogden, UT 84409 supplementing the return) to the state with which it filed a copy

Private delivery services. The organization can use certain of Form 990-EZ originally to meet that state’s filing requirement.

private delivery services designated by the IRS to meet the A state may require an organization to file an amended Form

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990-EZ to satisfy state reporting requirements, even if the whichever is later. Keep records that verify the organization’s

original return was accepted by the IRS. basis in property as long as they are needed to figure the basis

of the original or replacement property. Applicable law and an

G. Failure-to-File Penalties organization’s policies may require that the organization retain

records longer than 3 years. Against the organization. Under section 6652(c)(1)(A), a

penalty of $20 a day, not to exceed the smaller of $10,000 or The organization should also keep copies of any returns it

5% of the gross receipts of the organization for the year, may has filed. They help in preparing future returns and making

be charged when a return is filed late, unless the organization computations when filing an amended return.

can show that the late filing was due to reasonable cause. Rounding off to whole dollars. The organization must round Organizations with annual gross receipts exceeding $1 million off cents to whole dollars on the returns and schedules, unless

are subject to a penalty of $100 for each day failure continues otherwise noted for particular questions. To round, drop

(with a maximum penalty with respect to any one return of amounts under 50 cents and increase amounts from 50 to 99

$50,000). The penalty begins on the due date for filing Form cents to the next dollar. For example, $1.49 becomes $1 and

990-EZ. $2.50 becomes $3. If the organization has to add two or more

Tax-exempt organizations which are required to file amounts to figure the amount to enter on a line, include cents

electronically but do not are deemed to have failed to file the when adding the amounts and round off only the total.

return. This is true even if a paper return is submitted. Completing all lines. Make an entry (including a zero when

The penalty may also be charged if the organization files an appropriate) on all lines requiring an amount or other

incomplete return, such as by failing to complete a required line information to be reported. Do not leave any applicable lines

item or a required part of a schedule. To avoid penalties and blank, unless expressly instructed to skip that line. If answering

having to supply missing information later: a line is predicated on a “Yes” answer to the preceding line, and

if the organization’s answer to the preceding line was “No,” then 1. Complete all applicable line items; leave the “If Yes” line blank. 2. Unless instructed to skip a line, answer each question on

the return; In general, answers may be explained or supplemented in

3. Make an entry (including a zero when appropriate) on all an attachment if the allotted space in the form or other schedule

lines requiring an amount or other information to be reported; is insufficient, or if a “Yes” or “No” answer is required but the

and organization wishes to explain its answer.

4. Provide required explanations as instructed. Reporting proper amounts. Some lines may request

information reported on other forms filed by the organization. If Also, this penalty may be imposed if the organization’s return the organization is aware that the amount actually reported on contains incorrect information. For example, an organization the other form is incorrect, it must report on Form 990-EZ the that reports contributions net of related fundraising expenses information that should have been reported on the other form may be subject to this penalty. (in addition to filing an amended form with the proper amount). Use of a paid preparer does not relieve the organization of Inclusion of activities and items of disregarded entities and its responsibility to file a complete return. joint ventures. An organization must report in its Form Against Responsible Person(s). If the organization does not 990-EZ all of the revenues, expenses, assets, liabilities, and net file a complete return or does not furnish correct information, assets or funds of a disregarded entity of which it is the sole the IRS will send the organization a letter that includes a fixed member, and must report in its Form 990-EZ its share of all time to fulfill these requirements. After that period expires, the such items of a joint venture or other investment or person failing to comply will be charged a penalty of $10 a day. arrangement treated as a partnership for federal income tax The maximum penalty on all persons for failures with respect to purposes. This includes passive investments. In addition, the any one return shall not exceed $5,000. organization generally must report the activities of a There are also penalties (fines and imprisonment) for willfully disregarded entity or a joint venture in the appropriate parts of not filing returns and for filing fraudulent returns and statements schedules of the Form 990-EZ.

with the IRS (sections 7203, 7206, and 7207). States may List of required schedules and attachments. An impose additional penalties for failure to meet their separate organization may be required to file one or more of Schedules filing requirements. A, B, C, E, G, L, or N, or various other attachments as

described in the form or instructions. The following is a list of H. Requirements for a Properly the Form 990-EZ schedules that the organization may have to

Completed Form 990-EZ complete.

• Schedule A, Public Charity Status and Public Support. See All organizations must complete Parts I through VI of the Form Part V. Other Information. 990-EZ, and any required schedules and attachments. If an • Schedule B, Schedule of Contributors. See Item H. organization is not required to file Form 990-EZ but chooses to Requirements for a Properly Completed Form 990-EZ. do so, it must file a complete return and provide all of the • Schedule C, Political Campaign and Lobbying Activities, Part information requested, including the required schedules. I. See Line 46. Political Campaign Activities. Public inspection. In general, all information the organization • Schedule C, Political Campaign and Lobbying Activities, Part reports on or with its Form 990-EZ, including schedules and II. See Line 47. Lobbying Activities. attachments, will be available for public inspection. Note, • Schedule E, Schools. See Line 48. School. however, the special rules for Schedule B (Schedule of • Schedule G, Supplemental Information Regarding Contributors), a required schedule for certain organizations that Fundraising or Gaming Activities, Parts II and III. See Lines 6a file Form 990-EZ. Make sure the forms and schedules are clear through 6c. Special Events and Activities. enough to photocopy legibly. For more information on public • Schedule L, Transactions with Interested Persons, Part I. inspection requirements, see Appendix D and Publication 557, See Line 40b. Section 501(c)(3) and 501(c)(4) Organizations: Tax-Exempt Status of Your Organization. Disclosure of Section 4958 Excess Benefit Transactions and

Signature. A Form 990-EZ is not complete without a proper Excise Taxes. signature. For details, see the instructions to the Signature • Schedule L, Transactions with Interested Persons, Part II. Block, later. See Line 38. Loans To or From Officers, Directors, Trustees,

Recordkeeping. The organization’s records should be kept as and Key Employees.

long as they may be needed for the administration of any • Schedule N, Liquidation, Termination, Dissolution or

provision of the Internal Revenue Code. Usually, records that Significant Disposition of Assets, Parts I and II (substantial

support an item of income, deduction, or credit must be kept a contraction). See Line 36. Liquidation, Dissolution, Termination,

minimum of 3 years from the date the return is due or filed, or Substantial Contraction.

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The following is a list of required attachments to Form 990-EZ legal name (not its “doing business as” name) since it filed its

(not including required schedules listed above). previous return, or if this is the first time the organization is filing

1. Form 1128 for change of accounting period. See either a Form 990 or a Form 990-EZ. C.

Accounting Periods and Methods. If the organization has changed its name, attach the 2. Reasons for late filing. See D. When, Where, and How to following documents: File.

3. Description of amendments in amended return. See F. IF the organization is: THEN attach:

Amended Return/Final Return. A corporation Amendments to the articles of 4. Name change amendment to organizing document. See incorporation with proof of filing heading Item B. Checkboxes. with the state of incorporation. 5. Additional “also known as” (a.k.a.) names. See Heading,

Item C. Name and Address. A trust Amendments to the trust

6. Explanation of why an organization that reports more agreement signed by the trustee.

than $15,000 in Part I, line 6a, is not required to complete

Schedule G. See An unincorporated association Amendments to the articles of Lines 6a through 6c. Special Events and association, constitution, bylaws, Activities. or other organizing document, 7. Schedule of grants made. See Line 10. Grants and with the signatures of at least two Similar Amounts Paid. officers/members. 8. Explanation of other changes in net assets or fund

balances. See Line 20. Other Changes in Net Assets or Fund

Balances. Termination. Check this box if the organization has

9. Schedule listing other program services. See Part III, terminated its existence or ceased to be a section 501(a) or

Statement of Program Service Accomplishments, Line 31 Other section 527 organization and is filing its final return as an

program services and Part III. Statement of Program Service exempt organization or 4947(a)(1) trust. See the instructions for

Accomplishments. line 36 that discuss liquidations, dissolutions, terminations, or

10. Statement regarding personal benefit contracts. See Part substantial contractions. An organization that checks this box

VI. Section 501(c)(3) Organizations Only. must also attach Schedule N, Liquidation, Termination,

11. Description of activities not previously reported. See Line Dissolution or Significant Disposition of Assets.

33. Change in Activities. Amended Return. Check this box if the organization 12. Conformed copy of changes to organizing or governing previously filed a return with the IRS for the same tax year and document. See Line 34. Changes in Organizing or Governing is now filing another return for the same tax year to amend the Documents. previously filed return. Attach a statement explaining which 13. Reasons for not reporting income from business activities Parts, Schedules, or attachments of the Form 990-EZ were on Form 990-T. See Line 35. Unrelated Business Income and amended and describe the amendments. See General Lobbying Proxy Tax. Instruction F for more information. 14. Request and determination letter regarding termination of

exempt status. See Schedule N (Form 990 or 990-EZ) Application pending. Check this box if the organization has

Instructions. not yet filed either a Form 1023 or Form 1024 with the IRS, or

15. Articles of merger or dissolution, resolutions, and plans of has filed one and is awaiting a response. If this box is checked,

liquidation or merger. See Schedule N (Form 990 or 990-EZ) the organization must complete all parts of the Form 990-EZ

Instructions. and any required schedules.

Assembling Form 990-EZ, schedules, and attachments. Item C. Name and Address

Before filing the Form 990-EZ, assemble the package of forms, Enter the organization’s legal name in the “Name of

schedules, and attachments in the following order: organization” box. If the organization operates under a name

1. Core form with all parts completed (Parts I-V, Part VI by different from its legal name, identify its alternate name, after

section 501(c)(3) organizations, Signature Block), the legal name, by writing “a.k.a.” (also known as) and the

2. Schedules A, B, C, E, G, L, and/or N, completed as alternate name of the organization. If multiple a.k.a. names will

applicable, filed in alphabetical order, and not fit in the box, list them in an attachment. However, if the

3. Attachments, completed as applicable (including organization has changed its legal name, follow the instructions

attachments to explain or supplement answers because the for Name change in Item B— Checkboxes.

allotted space in the form is insufficient), filed in sequential Include the suite, room, or other unit number after the street order. address. If the Post Office does not deliver mail to the street

address and the organization has a P.O. box, show the box Do not attach materials not authorized in the instructions. number instead of the street address.

If the organization receives its mail in care of a third party

(such as an accountant or an attorney), enter on the street Specific Instructions for Form address line C/O followed by the third party’s name and street

address or P.O. box. 990-EZ

For foreign addresses, enter information in the following Completing the heading of Form 990-EZ order: city, province or state, and the name of the country. The instructions that follow are keyed to items in the heading for Follow the foreign country’s practice in placing the postal code Form 990-EZ. in the address. Please do not abbreviate the country name.

If a change of address occurs after the return is filed, use Item A. Accounting Period Form 8822, Change of Address, to notify the IRS of the new File the 2008 return for calendar year 2008 and fiscal years that address.

began in 2008 and ended in 2009. For a fiscal year return, fill in

the tax year space at the top of page 1. See General Instruction Item D. Employer Identification Number (EIN)

C for additional information about accounting periods. Use the employer identification number (EIN) provided to the

organization for filing its Form 990-EZ and federal tax returns. Item B. Checkboxes The organization must have only one EIN. If the organization

Address change, name change, and initial return. Check has more than one EIN and has not been advised which to use,

the appropriate box if the organization changed its address or notify the:

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Department of the Treasury Guidelines for Meeting the Requirements Internal Revenue Service Center

Ogden, UT 84201-0027 of Schedule B

Section 501(c)(3) Organization Meeting the 1/3 State what EINs the organization has, the name and address Support Test of 170(b)(1)(A)(vi) to which each number was assigned, and the address of the

organization’s principal office. The IRS will advise the If A section 501(c)(3) organization that met the organization which number to use. 33-and-1

/3% support test of the regulations under

section 509(a)(1) and 170(b)(1)(A)(vi) did not receive

a contribution of the greater of $5,000 or 2% of the A subordinate organization in a group exemption that is amount on line 1 of Form 990-EZ from any one filing an individual Form 990-EZ return must use its own contributor,* EIN, not that of the central organization or of the group

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return. Then The organization should check the box in item H to

certify that it is not required to attach Schedule B.

A section 501(c)(9) voluntary employees’ beneficiary Otherwise Complete and attach Schedule B.

association must use its own EIN and not the EIN of its

sponsor.

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Section 501(c)(7), (8), or (10) Organizations

If A section 501(c)(7), (8), or (10) organization did not Item E. Telephone Number receive any contribution or bequest for use Enter a telephone number of the organization that members of exclusively for religious, charitable, scientific, literary, the public and government personnel may use during normal or educational purposes, or the prevention of cruelty business hours to obtain information about the organization’s to children or animals (and did not receive any

finances and activities. If the organization does not have a noncharitable contributions of $5,000 or more as

telephone number, enter the telephone number of an described below under General Rule),

organization official who can provide such information. Then The organization should check the box in item H to

certify that it is not required to attach Schedule B.

Item F. Group Exemption Number Otherwise Complete and attach Schedule B.

Enter the four-digit group exemption number if the organization

is included in a group exemption. The group exemption number

(GEN) is a number assigned by the IRS to the central/parent All Other Form 990-EZ Organizations (General

organization of a group that has a group ruling. Contact the Rule) central/parent organization to ascertain the GEN assigned.

If The organization did not receive a contribution of

$5,000 or more from any one contributor* (reportable If the organization is covered by a group exemption on line 1 of the Form 990-EZ), letter as a subordinate organization, the organization CAUTION should file Form 990-EZ only if the organization is not Then The organization should check the box in item H to !

certify that it is not required to attach Schedule B. included in a group return filed by the central/parent

organization. Otherwise Complete and attach Schedule B.

The central/parent organization of a group ruling cannot * Add a contributor’s gifts of $1,000 or more to determine if a

file a group return with Form 990-EZ but must use Form contributor gave $5,000 or more. Do not include smaller gifts.

CAUTION 990.

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Item I. Website

Enter the organization’s website address. If the organization

Section 501(c)(3) organizations and section 4947(a)(1) does not maintain a website, enter “N/A” (not applicable).

nonexempt charitable trusts. Such organizations must Item J. Organization Type complete and attach Schedule A (Form 990 or 990-EZ), Public

Charity Status and Public Support. Check the applicable box to show the organization’s type of tax

status. If the organization is exempt under section 501(c), check

the 501(c) box and insert the appropriate subsection number

Item G. Accounting Method within the parentheses (for example,“3” for a 501(c)(3)

organization). See the chart in Appendix A, Exempt Indicate the method of accounting used in preparing this return.

See General Instruction C. Organization Reference Chart. The term section 501(c)(3)

includes organizations exempt under sections 501(e), (f), (k),

and (n).

Item H. Schedule B Item K. Gross Receipts of $25,000 or Less Whether or not the organization enters any amount on line 1 of Check this box if the organization is not a section 509(a)(3) Form 990-EZ, the organization must either check the box in supporting organization and its gross receipts are normally not item H or attach Schedule B. Failure to either check the box in more than $25,000 but the organization chooses to file Form item H or file Schedule B will result in a determination that the 990-EZ. If the organization chooses to file Form 990-EZ, be return is incomplete. See the Instructions for Schedule B for sure to file a complete return. See Appendix B for a discussion more information. of gross receipts and General Instruction H for a discussion of a

complete return.

For purposes of Schedule B, contributors include Sections 501(c)(7) and 501(c)(15) organizations use individuals, fiduciaries, partnerships, corporations, different definitions of gross receipts to determine associations, trusts, and exempt organizations. For whether they qualify for tax exemption for the year. See

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CAUTION

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organizations described in section 170(b)(1)(A)(iv) or (vi) or the definition of gross receipts for 501(c)(7) and 501(c)(15) 509(a)(2), contributors also include governmental units. exemption purposes under Appendix C. Do not use the section

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501(c)(7) or 501(c)(15) definition of gross receipts to determine Example. An organization announces that anyone who

whether the organization’s gross receipts are normally $25,000 contributes at least $40 to the organization can choose to

or less. receive a book worth $16 retail value. A person who gives $40,

and who chooses the book, is really purchasing the book for Item L. Determining Gross Receipts $16 and also making a contribution of $24. The contribution of

Add lines 5b, 6b, and 7b to line 9 to determine gross receipts. $24, which is the difference between the buyer’s payment and

See Appendix B and Appendix C for discussion of gross the $16 retail value of the book, would be reported on line 1 and

receipts. again on line 6a (within the parentheses). The revenue received

($16 retail value of the book) would be reported in the For 2008 tax years, only those organizations with gross right-hand column on line 6a. Any expenses directly relating to receipts of less than $1,000,000 and total assets of less than the sale of the book would be reported on line 6b. Any $2,500,000 at the end of the year can use the Form 990-EZ. If fundraising expenses relating to the contribution of $24 would the organization does not meet these requirements, it must file be reported on lines 12 through 16. Form 990, unless excepted under General Instruction B.

If a contributor gives more than $40, that person would be Do not use the definition of gross receipts for section making a larger contribution, the difference between the book’s 501(c)(7) or 501(c)(15) exemption purposes (discussed retail value of $16 and the amount actually given. Rev. Rul. CAUTION in Appendix C) to determine the amount to enter here.

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67-246, 1967-2 C.B. 104, explains this principle in detail. See

also the instructions for line 6 and Pub. 526, Charitable

Part I. Revenue, Expenses, and Changes Contributions. 

in Net Assets or Fund Balances At the time of any solicitation or payment, organizations

All organizations filing Form 990-EZ with the IRS or any state that are eligible to receive tax-deductible contributions

must complete Part I. Some states that accept Form 990-EZ in CAUTION should advise patrons of the amount deductible for

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place of their own forms may require additional information. See federal tax purposes. See Pub. 1771, Charitable Contributions -

Appendix G Substantiation and Disclosure Requirements. .

A2. Contributions can arise from special events when Revenue: items of only nominal or insubstantial value are given or Line 1. Contributions, Gifts, Grants, and Similar offered. If an organization offers goods or services of only Amounts Received nominal or insubstantial value through a special event, or

distributes free, unordered, low-cost items to patrons, report the A. What is included on line 1 entire amount received for such benefits as a contribution on

• Report amounts received as voluntary contributions; for line 1. See also the instruction for line 6, B1 regarding nominal

example, payments, or the part of any payment, for which the or insubstantial value. Report all related expenses on lines 12

payer (donor) does not receive full retail value (fair market through 16.

value) from the recipient (donee) organization. Contributions Benefits have a nominal or insubstantial value if the

are reported on line 1 regardless of whether they are deductible organization informs patrons how much of their payment is a by the contributor. deductible contribution, and either: • Enter the gross amounts of contributions, gifts, grants, and 1. The fair market value of all of the benefits received in bequests that the organization received from individuals, trusts, connection with the payment is not more than 2% of the corporations, estates, affiliates, foundations, public charities, payment or $91, whichever is less, or and other exempt organizations, or raised by an outside 2. The payment is $45.50 or more and the only benefits professional fundraiser. received in connection with the payment are token items • Report the value of noncash contributions at the time of the (bookmarks, calendars, key chains, mugs, posters, T-shirts, donation. For example, report the gross value of a donated car etc.) bearing the organization’s name or logo. The cost to the as of the time the car was received as a donation. organization (as opposed to fair market value) of all benefits • Report all related expenses on lines 12 through 16. Show on received by a donor must, in the aggregate, be $9.10 or less. line 13 professional fundraising fees relating to the gross

amounts of contributions collected in the charity’s name by A3. Contributions in the form of membership dues. fundraisers. Include on line 1 membership dues and assessments to the Reporting line 1 amounts in accordance with SFAS 116, extent they are contributions and not payments for benefits Accounting for Contributions Received and Contributions Made, received. (See the instruction for line 3, C1.) is acceptable but not required by the IRS. However, state law

may require it. An organization that receives a grant to be paid A4. Grants equivalent to contributions. Grants made to

encourage an organization receiving the grant to carry on in future years should, according to SFAS 116, report the programs or activities that further the grant recipient’s exempt grant’s present value on line 1. Accruals of present value purposes are grants that are equivalent to contributions. Report increments to the unpaid grant should also be reported on line 1 them on line 1. The grantor may specify which of the recipient’s in future years. activities the grant may be used for, such as an adoption A1. Contributions can arise from special events when an program or a disaster relief project. excess payment is received for items offered. Fundraising A grant is still equivalent to a contribution if the grant activities relate to soliciting and receiving contributions.

However, special fundraising activities such as dinners, recipient performs a service, or produces a work product, that

benefits the grantor incidentally (but see the instruction for line door-to-door sales of merchandise, carnivals, and bingo games 1, B1, below). can produce both contributions and revenue. Report as a

contribution, both on line 1 and on line 6a (within the A5. Contributions or grants from governmental units. A

parentheses), any amount received through such a special grant or other payment from a governmental unit is treated as a

event that is greater than the fair market value (retail value) of grant equivalent to a contribution if its primary purpose is to

the merchandise or services furnished by the organization to enable the recipient to provide a service to, or maintain a facility

the contributor. for, the direct benefit of the public rather than to serve the direct

and immediate needs of the grantor (even if the public pays part This situation usually occurs when organizations seek of the expense of providing the service or facility). (See the support from the public through solicitation programs that are in instruction for line 2, D below.) part special events or activities and are in part solicitations for

contributions. The primary purpose of such solicitations is to The following are examples of governmental grants and

receive contributions and not to sell the merchandise at its retail other payments that are treated as contributions and reported

value, even though this might produce a profit. on line 1:

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• Payments by a governmental unit for the construction or D. Schedule of contributors. Attach Schedule B if required.

maintenance of library or museum facilities open to the public, See the Specific Instructions for Completing the Heading of

• Payments by a governmental unit to nursing homes to Form 990-EZ, Item H. Schedule B .

provide health care to their residents (but see treatment of

Medicare, Medicaid, and other third-party reimbursements on Section 501(c)(3) organizations must compute the

behalf of specific individuals under the line 2 instructions), and amount of contributions according to the above

• Payments by a governmental unit to child placement or child instructions in preparing the support schedule in Part II

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guidance organizations under government programs to better or III of Schedule A (Form 990 or 990-EZ), Public Charity Status

serve children in the community. and Public Support.

The following examples illustrate the distinction between Line 2. Program Service Revenue Including government payments reportable on lines 1 and 2. Government Fees and Contracts • A payment by a governmental agency to a medical clinic to

provide vaccinations to the general public is a contribution Enter the total program service revenue (exempt function

reported on line 1. A payment by a governmental agency to a income). Program services are primarily those that form the

medical clinic to provide vaccinations to employees of the basis of an organization’s exemption from tax.

agency is program service revenue reported on line 2. A. Examples. A clinic would include on line 2 all of its charges • A payment by a governmental agency to an organization to for medical services (whether to be paid directly by the patients provide job training and placement for disabled individuals is a or through Medicare, Medicaid, or other third-party contribution reported on line 1. A payment by a governmental reimbursement), laboratory fees, and related charges for agency to the same organization to operate the agency’s services. internal mail delivery system is program service revenue

reported on line 2. Program service revenue also includes tuition received by a

A6. Contributions received through other fundraising school; revenue from admissions to a concert or other

organizations. Contributions received indirectly from the performing arts event or to a museum; royalties received as

public through solicitation campaigns conducted by federated author of an educational publication distributed by a commercial

publisher; payments received by a section 501(c)(9) fundraising agencies (such as United Way) are included on line

1. organization from participants or employers of participants for

health and welfare benefits coverage; and registration fees A7. Contributions received from associated received in connection with a meeting or convention. organizations. Include on line 1 amounts contributed by other

organizations closely associated with the reporting organization. B. Program-related investment income. Program service This includes contributions received from a parent organization, revenue also includes income from program-related subordinate, or another organization having the same parent. investments. These investments are made primarily to

A8. Contributions from a commercial co-venture. accomplish an exempt purpose of the investing organization

Include amounts contributed by a commercial co-venture on rather than to produce income. Examples of program-related

line 1. These contributions are amounts received by the investments are scholarship loans and low-interest loans to

organization for allowing an outside organization (donor) or charitable organizations, indigents, or victims of a disaster. See

also the instructions for line 4. individual to use the recipient organization’s name in a sales

promotion campaign, such as where the outside organization Rental income received from an exempt function is another agrees to contribute 2% of all sales proceeds to the example of program-related investment income, such as organization. below-market rents from housing leased to low-income

B. What is not included on line 1? persons. When an organization rents to an unaffiliated exempt

B1. Grants that are payments for services are not organization at less than fair rental value for the purpose of

contributions. A grant is a payment for services, and not a aiding that tenant’s exempt function, the reporting organization

contribution, when the terms of the grant provide the grantor should report such rental income as program service revenue

with a specific service, facility, or product, rather than providing on line 2. For purposes of this return, report all rental income

a benefit to the general public or that part of the public served from an affiliated organization on line 2.

by the grant recipient. The recipient organization would report C. Unrelated trade or business activities. Unrelated trade or such a grant as income on line 2 (program service revenue). (not including any special events or activities) that generate

B2. Donations of services or use of property. Do not fees for services may also be program service activities. A

include the value of services donated to the organization, or of social club, for example, should report as program service

the free use of property (such as equipment or facilities), as revenue the fees it charges both members and nonmembers for

contributions on line 1. However, for the optional reporting of the use of its tennis courts and golf course.

such amounts, see the instruction for donated services in Part D. Government fees and contracts. Program service III. revenue includes income earned by the organization for Any unreimbursed expenses of officers, employees, or providing a government agency with a service, facility, or volunteers do not belong on the Form 990-EZ. See the product that benefitted that government agency directly rather explanations of charitable contributions and employee business than benefiting the public as a whole. See line 1, instruction A5, expenses in Pub. 526, Charitable Contributions, and Pub. 463, for reporting guidelines when payments are received from a Travel, Entertainment, Gift, and Car Expenses, respectively. government agency for providing a service, facility, or product

B3. Section 501(c)(9), (17), and (18) organizations. for the primary benefit of the general public.

These organizations provide participants with life, sickness,

accident, welfare and unemployment insurance, pension(s), or Line 3. Membership Dues and Assessments

similar benefits, or a combination of these benefits. When such Enter members’ and affiliates’ dues and assessments that are

an organization receives payments from participants, or their not contributions.

employers, to provide these benefits, report the payments on

line 2 as program service revenue, rather than on line 1 as A. What is included on line 3?

contributions. A1. Dues and assessments received that compare

C. How to value noncash contributions. Report noncash reasonably with the benefits of membership. When the

contributions on line 1 at fair market (retail) value. If fair market organization receives dues and assessments the value of which

value cannot be readily determined, use an appraised or compare reasonably with the value of benefits provided to

estimated value. See also the instructions for Part II of members (whether or not the membership benefits are used by

Schedule B. the members), report such dues and assessments on line 3.

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A2. Organizations that generally match dues and exempt function (program service). Report these amounts on

benefits. Organizations described in section 501(c)(5), (6), or line 2 as program service revenue. Report expenses related to

(7) generally provide benefits with a reasonable relationship to this income on lines 12 through 16.

dues, although benefits to members may be indirect. Exempt function rental income. An organization whose

B. Examples of membership benefits. These include exempt purpose is to provide low-rental housing to persons with

subscriptions to publications; newsletters (other than one about low income receives exempt function income from such rentals.

the organization’s activities only); free or reduced-rate An organization receives exempt function income if it rents or

admissions to events sponsored by the organization; use of the sublets rental space to a tenant whose activities are related to

organization’s facilities; and discounts on articles or services the reporting organization’s exempt purpose. Exempt function

that both members and nonmembers can buy. In figuring the income also arises when an organization rents to an unaffiliated

value of membership benefits, disregard such intangible exempt organization at less than fair rental value for the

benefits as the right to attend meetings, vote, or hold office in purpose of helping that unaffiliated organization carry out its

the organization, and the distinction of being a member of the exempt purpose. Report rental income received in these

organization. instances on line 2 and not on line 4. Only for purposes of

completing this return, treat income from renting property to C. What is not included on line 3? affiliated exempt organizations as exempt function income and C1. Dues or assessments received that exceed the value include such income on line 2 as program service revenue. of available membership benefits. Dues received by an Other program-related investments. Investment income organization, to the extent they exceed the monetary value of from program-related investments should be reported on line 2. the membership benefits available to the dues payer, are a See the line 2 instructions for a discussion of program-related contribution that should be reported on line 1. investments. Gains or losses from the sale of program-related C2. Dues received primarily for the organization’s investment assets are reported on line 5.

support. If a member pays dues primarily to support the

organization’s activities, and not to obtain benefits of more than Lines 5a through 5c. Gains (or Losses) From

nominal or insubstantial monetary value, those dues are a Sale of Assets Other Than Inventory

contribution to the organization includible on line 1. A. What is included on line 5? Example. M is an organization whose primary purpose is to Report on line 5a all sales of securities and sales of all other support the local symphony orchestra. Members have the types of investments (such as real estate, royalty interests, or privilege of purchasing subscriptions to the symphony’s annual partnership interests) as well as sales of all other non-inventory concert series before they go on sale to the general public, but

must pay the same price as any other member of the public. assets (such as program-related investments and fixed assets

used by the organization in its related and unrelated activities). They also are entitled to attend a number of rehearsals each Also report capital gains dividends, the organization’s share of season without charge. Under these circumstances, M’s capital gains and losses from a partnership, and capital gains receipts from members are contributions reported on line 1. distributions from trusts.

Line 4. Investment Income Total the cost or other basis (less depreciation) and selling

expenses and enter the result on line 5b. On line 5c, enter the A. What is included on line 4? net gain or loss. A1. Interest on savings and temporary cash For reporting sales of securities on Form 990-EZ, the investments. Include the amount of interest received from organization may use the more convenient way to figure the interest-bearing checking accounts, savings, and temporary organization’s gain or loss from sales of securities by cash investments, such as money market funds, commercial subtracting from the sales price the average-cost basis of the paper, certificates of deposit, and U.S. Treasury bills or other particular security sold. However, the average-cost basis is not governmental obligations that mature in less than one year. used to figure the gain or loss from sales of securities So-called dividends or earnings received from mutual savings reportable on Form 990-T. banks, money market funds, etc., are actually interest and

should be included on this line. B. What is not included on line 5?

A2. Dividends and interest from securities. Include Do not include on line 5 any unrealized gains or losses on

dividends from equity securities (stocks), and interest income securities that are carried in the books of account at market

from debt securities and notes and loans receivable, other than value. See the instructions for line 20.

program-related investments. Include amounts received from C. Books and records payments on securities loans, as defined in section 512(a)(5). The organization should maintain books and records to A3. Gross rents. Include gross rental income received substantiate information regarding any securities or other during the year from investment property (other than assets sold for which market quotations were not published or program-related investments reported on line 2). were not otherwise readily available. The recorded information

A4. Other investment income. Include, for example, should include:

royalties received by the organization from licensing the • A description of the asset,

ongoing use of its property to others (other than royalties • Date acquired,

generated in the conduct of the organization’s exempt function, • Whether acquired by donation or purchase,

such as royalties received from a publisher for an educational • Date sold and to whom sold,

work authored by the organization). Typically, royalties are • Gross sales price,

received for the use of intellectual property, such as copyrights, • Cost, other basis, or if donated, value at time acquired,

patents, and trademarks. Royalties also include payments to • Expense of sale and cost of improvements made after

the owner of property for the right to exploit natural resources acquisition, and

on the property, such as oil, natural gas, or minerals. • Depreciation since acquisition, if depreciable property.

B. What is not included on line 4? Lines 6a through 6c. Special Events and Activities

B1. Capital gains dividends and unrealized gains and On the appropriate line, enter the gross revenue, expenses,

losses. Do not include on this line any capital gains dividends. and net income (or loss) from all special events and activities,

They are reported on line 5. Also do not include unrealized such as dinners, dances, carnivals, concerts, sports events,

gains and losses on investments carried at market value. See auctions, raffles, bingo games, other gaming activities, and

the instructions for line 20. door-to-door sales of merchandise.

B2. Exempt function revenue (program service). Do not Special events and activities only incidentally accomplish an

include on line 4 amounts that represent income from an exempt purpose. Their sole or primary purpose is to raise funds

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to finance the organization’s exempt activities. They do not the prizes awarded have only nominal or insubstantial value.

include events or activities that substantially further the See line 6, instruction B1 and B2, below.

organization’s exempt purpose even if they also raise funds. A3. Direct expenses. Report on line 6b only the direct They do not include activities regularly carried on (except for expenses attributable to the goods or services the buyer gaming). receives from a special event. If an expense is included on line

Example. An organization formed to promote and preserve 6b, do not report it again on line 7b. Fundraising expenses

folk music and related cultural traditions holds an annual folk attributable to contributions reported on lines 1 and 6a (within

music festival featuring concerts, handicraft demonstrations, the parentheses) are reportable on lines 12 through 16.

and similar activities. Because the festival directly furthers the B. What is not included on line 6? organization’s exempt purpose, income from ticket sales should B1. Sales or gifts of goods or services of only nominal be reported on line 2 as program service revenue. or insubstantial value. If the goods or services offered at the Special events and activities raise funds by offering goods or special event have only nominal or substantial value, include all services that have more than a nominal or insubstantial value of the receipts as contributions on line 1 and all of the related (compared to the price charged) for a payment that is more expenses on lines 12 through 16. See line 1, instruction A2 for than the direct cost of those goods or services. See line 1 a description of nominal or insubstantial benefits. instructions A1 and A2 for a discussion on contributions B2. Sweepstakes, raffles, and lotteries. Report as a reportable on line 1 and revenue reportable on line 6. contribution, on line 1, the proceeds of solicitation campaigns in The fact that tickets, advertising, or solicitation materials which the names of contributors and other respondents (who

refer to a required payment as a donation or contribution does were not required to make a minimum payment) are entered in

not control how these payments should be reported on Form a drawing for prizes.

990-EZ. Where a minimum payment is required for each raffle or

The gross revenue from gaming activities and other special lottery entry and prizes of only nominal or insubstantial value

events must be reported in the right-hand column on line 6a are awarded, report any amount received as a contribution.

without reduction for cash or noncash prizes, cost of goods Report the related expenses on lines 12 through 16.

sold, compensation, fees, or other expenses. B3. Activities that generate only contributions are not

Gaming. Check the box for gaming if the organization special events. An activity that generates only contributions,

conducted directly, or through a promoter, any amount of such as a solicitation campaign by mail, is not a special event.

gaming during the year. Report the gross revenue, expenses, Any amount received should be included on line 1 as a

and net income (or loss) from all gaming activities, whether or contribution. Related expenses are reportable on lines 12

not regularly carried on, in line 6. through 16.

Gaming includes (but is not limited to): bingo, pull tabs, C. Attach Schedule G, Parts II and III

instant bingo raffles, scratch-offs, charitable gaming tickets, If the organization reports more than $15,000 in line 6a (not break-opens, hard cards, banded tickets, jar tickets, pickle including the contribution amount in the parentheses), then it cards, Lucky Seven cards, Nevada Club tickets, casino nights, must complete Part II of Schedule G (Form 990 or Las Vegas nights, and coin-operated gambling devices. 990-EZ),Supplemental Information Regarding Fundraising or Coin-operated gambling devices include slot machines, Gaming Activities, for any special events (other than gaming) electronic video slot or line games, video poker, video with gross receipts greater than $5,000. (Please note that blackjack, video keno, video bingo, video pull tab games, etc. Schedule G refers to special events other than gaming as

Many games of chance are taxable. Income from bingo “fundraising events.”) If the organization reports more than

games is generally not subject to the tax on unrelated business $15,000 in line 6a (not including the contribution amount in the

income if the games meet the legal definition of bingo. For a parentheses) and any part of the amount is gross revenue from

game to meet the legal definition of bingo, wagers must be gaming, then it must complete Schedule G, Part III, to report its

placed, winners must be determined, and prizes or other gaming activities. If the organization reports more than $15,000

property must be distributed in the presence of all persons in line 6a (not including the contribution amount in the

placing wagers in that game. parentheses) but is not required to complete either Part II or

Part III of Schedule G, then explain this in an attachment. A wagering game that does not meet the legal definition of Organizations filing Form 990-EZ are not required to complete bingo does not qualify for the exclusion, regardless of its name. Part I of Schedule G. The following examples illustrate these For example, “instant bingo,” in which a player buys a Form 990-EZ reporting rules for Schedule G. pre-packaged bingo card with pull-tabs that the player removes Example 1. Organization X receives gross revenue of to determine if he or she is a winner, does not qualify. See Pub.

598, Tax on Unrelated Business Income of Exempt $14,000 during the tax year from the sale of pull tabs.

Organizations and Form 990-T. Organization X reports $14,000 in line 6a. Organization X is not

required to file Schedule G because its line 6a amount does not A. What is included on line 6? exceed $15,000.

A1. Gross revenue/contributions. When an organization Example 2. Organization Y conducted during the tax year receives payments for goods or services offered through a its annual fundraising dinner plus monthly bingo nights. special event, enter: Organization Y received $2,000 in gross revenue (excluding

1. As gross revenue, on line 6a (in the right-hand column), $4,000 in contributions) from the dinner and $14,000 in gross

the retail value of the goods or services, revenue from the bingo nights. Organization Y is directed to

2. As a contribution, on both line 1 and line 6a (within the Schedule G because it reports $16,000 on line 6a, which

parentheses), any amount received that exceeds the retail exceeds the $15,000 threshold for filing Schedule G.

value of the goods or services given. Organization Y must report the dinner as a fundraising event in

Part II of Schedule G because the gross receipts from the

Example. At a special event, an organization received $100 dinner (including contributions) was $6,000 (in excess of in gross receipts for goods valued at $40. The organization $5,000). Organization Y must report the $14,000 in gross entered gross revenue of $40 on line 6a and entered a revenue from the conduct of bingo games in Part III of Schedule contribution of $60 on both line 1 and within the parentheses on G, even though that amount is less than $15,000, because the

line 6a. The contribution was the difference between the gross total amount reported on line 6a exceeded $15,000. revenue of $40 and the gross receipts of $100. Example 3. Organization Z conducted six special events

A2. Raffles or lotteries. Report as revenue, on line 6a, (other than gaming) during the tax year. Each special event

any amount received from raffles or lotteries that require generated $3,000 in gross revenue and $1,000 in contributions.

payment of a specified minimum amount for each entry, unless Organization Z is directed to Schedule G because it reports

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$18,000 in line 6a. Organization Z is not required to file Part II C. Attach schedule

of Schedule G, however, as each event had gross receipts of Attach a schedule to itemize each grantee organization or $4,000, below the $5,000 threshold for reporting fundraising individual to whom the organization made grants (or paid similar events in Part II. Because Organization Z had no gross revenue amounts) in excess of $5,000 during the organization’s tax from gaming, it is not required to file Part III of Schedule G. year. For each grantee, list: Organization Z should describe the above facts in its • Each class of activity, attachment explaining that it is not required to file Schedule G, • The grantee’s name and address (for grantee organizations, even though its line 6a amount exceeds $15,000. not grantee individuals),

Lines 7a through 7c. Gross Sales of Inventory • The amount given, and

• The relationship of the grantee (in the case of grants to Line 7a. Sales of inventory. Include on line 7a the gross individuals) if the relationship is by blood, marriage, adoption, or sales (less returns and allowances) of inventory items, whether employment (including employees’ children) to any person or the sales activity is an exempt function or an unrelated trade or corporation with an interest in the organization, such as a business. Inventory items are goods the organization makes to creator, donor, director, trustee, officer, key employee, etc. sell to others, or that it buys for resale. Include all inventory

sales except sales of goods at special events, which are If the individual grantee is related to a grantor or

reportable on line 6. Do not include on line 7 sales of contributor to the organization, then do not provide the

investments on which the organization expected to profit by CAUTION name of the grantor or contributor. Instead, identify such

!

appreciation and sale; report sales of these investments on line persons generically as “grantee” and as “grantor” or

5. “contributor.”

Line 7b. Cost of goods sold. On line 7b, report the cost of If any affiliate received any payment reported on line 10,

goods sold related to sales of such inventory. The usual items then so indicate, and also specify the purpose of the payment.

included in cost of goods sold are direct and indirect labor, Classify activities on this schedule in more detail than by

materials and supplies consumed, freight-in, and a proportion of using such broad terms as charitable, educational, religious, or

overhead expenses. Marketing and distribution expenses are scientific. For example, identify payments to affiliates; payments

not includible in cost of goods sold but are reported on lines 12 for nursing services; fellowships; and payments for food,

through 16. shelter, or medical services for indigents or disaster victims.

Line 8. Other Revenue Colleges, universities, and primary and secondary schools

reporting scholarships or other financial assistance may instead Enter the total income from all sources not covered by lines 1 attach a statement that (a) groups each type of financial aid through 7. Examples of types of income includible on line 8 are provided; (b) indicates the number of individuals who received interest on notes receivable not held as investments or as the aid; and (c) specifies the aggregate dollar amount. program-related investments (defined in the line 2 instructions);

interest on loans to officers, directors, trustees, key employees, If an organization gives property other than cash and

and other employees; and royalties that are not investment measures an award or grant by the property’s fair market value,

also show on this schedule: income or program service revenue. • A description of the property, Expenses • The book value of the property,

Line 10. Grants and Similar Amounts Paid • How the organization determined the book value,

• How the organization determined the fair market value, and A. What is included on line 10? • The date of the gift.

Enter the amount of actual grants and similar amounts paid to Any difference between a property’s fair market value and individuals and organizations selected by the filing organization. book value should be recorded in the organization’s books of Include scholarship, fellowship, and research grants to account and on line 20.

individuals. Line 11. Benefits Paid To or For Members A1. Specific assistance to individuals. Include on this For an organization that gives benefits to members or line the amount of payments to, or for the benefit of, particular dependents (such as organizations exempt under section clients or patients, including assistance by others at the 501(c)(8), (9), or (17)), enter the amounts paid for: (a) death, organization’s expense. sickness, hospitalization, or disability benefits; (b) A2. Payments, voluntary awards, or grants to affiliates. unemployment compensation benefits; and (c) other benefits. Include on line 10 certain types of payments to organizations Report on line 12, rather than line 11, the cost of affiliated with (closely related to) the filing organization. These employment-related benefits (such as health insurance) that the payments include predetermined quota support and dues organization gives its officers and employees. payments by local organizations to their state or national

organizations. Line 12. Salaries, Other Compensation, and

Employee Benefits If the organization uses Form 990-EZ for state reporting Enter the total salaries and wages paid to all employees and purposes, be sure to distinguish between payments to the fees paid to officers, directors, and trustees. Include the CAUTION affiliates and awards and grants. See Appendix G. !

total of the employer’s share of the contributions the

B. What is not included on line 10? organization paid to qualified and nonqualified pension plans

and the employer’s share of contributions to employee benefit B1. Administrative expenses. Do not include on this line programs (such as insurance, health, and welfare programs) expenses made in selecting recipients or monitoring that are not an incidental part of a pension plan. compliance with the terms of a grant or award. Enter those

expenses on lines 12 through 16. Complete Form 5500, Annual Return/Report of

B2. Purchases of goods or services from affiliates. Do Employee Benefit Plan, if the organization is required to

not report the cost of goods or services purchased from file it.

TIP

affiliates on line 10. Report these expenses on lines 12 through Also include in the total the amount of federal, state, and 16. local payroll taxes for the year that are imposed on the

B3. Membership dues paid to another organization. organization as an employer. This includes the employer’s

Report membership dues that the organization pays to another share of social security and Medicare taxes, Federal

organization (other than an affiliated organization) for general unemployment tax (FUTA), state unemployment compensation

membership benefits, such as regular services, publications, tax, and other state and local payroll taxes. Taxes withheld from

and materials, on line 16 as other expenses. employees’ salaries and paid over to the various governmental

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units (such as Federal and state income taxes and the Net Assets

employees’ share of social security and Medicare taxes) are

part of the employees’ salaries included on line 12. Report Line 18. Excess or (Deficit) for the Year

expenses paid or incurred for employee events such as a picnic Enter the difference between lines 9 and 17. If line 17 is more or holiday party on this line. than line 9, enter the difference in parentheses.

Line 13. Professional Fees and Other Payments to Line 19. Net Assets or Fund Balances at Beginning of Independent Contractors Year

Enter the total amount of legal, accounting, auditing, other Enter the end-of-year amount from the balance sheet on the professional fees (such as fees for fundraising or investment prior year’s return. services) and related expenses charged by outside firms and

individuals who are not employees of the organization. Line 20. Other Changes in Net Assets or Fund

Balances Do not include any penalties, fines, or judgments imposed

against the organization as a result of legal proceedings; report Attach a statement explaining any changes in net assets or

and identify those expenses on line 16. Report on line 12 fees fund balances between the beginning and end of the

paid to directors and trustees. Also report on line 12 organization’s tax year that are not accounted for by the amount

on line 18. Amounts to report here include adjustments of compensation to employees that provide fundraising, legal,

accounting, or other professional services as part of their earlier years’ activity; unrealized gains and losses on

employment. Report broker fees/commissions as sales investments carried at market value; and any difference

expenses on line 5b. between fair market value and book value of property given as

an award or grant. See General Instruction C regarding the

In some cases the organization may be required to reporting of a section 481(a) adjustment to conform to SFAS

116. report payments to an independent contractor on Form

1099-MISC, Miscellaneous Income.

TIP

Part II. Balance Sheet

Line 14. Occupancy, Rent, Utilities, and Maintenance Every organization must complete columns (A) and (B) of Part II

Enter the total amount paid or incurred for the use of office of the return and may not submit a substitute balance sheet.

space or other facilities, including rent or mortgage interest; Failure to complete Part II may result in penalties for filing an

heat, light, power, and other utilities; outside janitorial services; incomplete return. If there is no amount to report in column (A),

real estate taxes and property insurance attributable to rental Beginning of year, enter a zero in that column.

property; and similar expenses. Some states require more information. See Appendix G for

These expenses relate to real property actually occupied by more information about completing a Form 990-EZ to be filed

the organization, whether as tenant or owner, or used in the with any state or local government agency.

conduct of exempt functions (such as low-income rental

housing). Report on line 16 expenses relating to real property Line 22. Cash, Savings, and Investments used for investment purposes. If the organization occupies part Include all interest and non-interest bearing accounts such as of the property and leases a part to others, then expenses must petty cash funds, checking accounts, savings accounts, money be reasonably allocated between occupancy-related and market funds, commercial paper, certificates of deposit, U.S. investment-related expenses, and reported accordingly on lines Treasury bills, and other government obligations. Also include 14 and 16. the book value of securities held as investments, and all other

If the organization records depreciation on property it investment holdings including land and buildings held for

occupies, enter the total for the year. For an explanation of investment. Report the income from these investments on line

acceptable methods for computing depreciation, see Pub. 946. 4.

Do not subtract from rental expenses reported on line 14 or Line 23. Land and Buildings

16 any rental income received from renting or subletting rented Enter the book value (cost or other basis less accumulated space. See the instructions for lines 2 and 4 to determine depreciation) of all land and buildings owned by the whether such income is reportable as exempt function income organization and not held for investment. or investment income. However, report on line 14 or 16 any

rental expenses for rental income reported on lines 2 and 4. Line 24. Other Assets

Enter the total of other assets along with a description of those Line 15. Printing, Publications, Postage, and assets. Amounts to include here are (among others) accounts Shipping receivable, inventories, and prepaid expenses.

Enter the printing and related costs of producing the reporting

organization’s own newsletters, leaflets, films, and other Line 25. Total Assets

informational materials on this line. Include the costs of outside Enter the amount of total assets. If the end-of-year total assets mailing services on this line. Also include the cost of any entered in column (B) are $2,500,000 or more, Form 990 must purchased publications as well as postage and shipping costs be filed instead of Form 990-EZ.

not reportable on lines 5b, 6b, or 7b. Do not include any

expenses, such as salaries, for which a separate line is Line 26. Total Liabilities

provided. Liabilities include such items as accounts payable, grants

payable, mortgages or other loans payable, and deferred Line 16. Other Expenses revenue (revenue received but not yet earned).

Report expenses here that are not reportable on lines 10

through 15. Include here such expenses as penalties, fines, and Line 27. Net Assets or Fund Balances

judgments; unrelated business income taxes; insurance, Subtract line 26 (total liabilities) from line 25 (total assets) to

interest, depreciation, and real estate taxes not reported as determine net assets. Enter this net asset amount on line 27.

occupancy expenses; travel and transportation costs; and The amount entered in column (B) must agree with the net

expenses for conferences, conventions, and meetings. asset or fund balance amount on line 21.

Some states that accept Form 990-EZ in satisfaction of their States that accept Form 990-EZ as their basic report form

filing requirements may require that certain types of may require a separate statement of changes in net assets.

miscellaneous expenses be itemized. See Appendix G. See Appendix G.

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body, but at a minimum include those officers required by Part III. Statement of Program Service applicable state law.

Accomplishments Director or Trustee. A director or trustee is a member of

A program service is a major (usually ongoing) objective of an the organization’s governing body, but only if the member has

organization, such as adoptions, recreation for the elderly, voting rights. The governing body is the group of persons

rehabilitation, or publication of journals or newsletters. authorized under state law to make governance decisions on

behalf of the organization and its shareholders or members, if

Step Action applicable. The governing body is, generally speaking, the

1 State the organization’s primary exempt purpose. board of directors (sometimes referred to as board of trustees)

2 All organizations must describe their exempt purpose of a corporation or association, or the board of trustees of a

achievements for each of their three largest program services (as trust (sometimes referred to simply as the trustees, or trustee, if

measured by total expenses incurred). If there were three or fewer only one trustee).

of such activities, describe each program service activity. Key employee. A key employee is any person having • Describe program service accomplishments through responsibilities or powers similar to those of officers, directors, measurements such as clients served, days of care, number or trustees. The term includes the chief management and of sessions or events held, or publications issued. administrative officials of an organization (such as an executive • Describe the activity’s objective, for both this time period director or chancellor). A chief financial officer and the officer in and the longer-term goal, if the output is intangible, such as charge of the administration or program operations are both key in a research activity.

• Give reasonable estimates for any statistical information if employees if they have the authority to control the

exact figures are not readily available. Indicate that this organization’s activities, its finances, or both.

information is estimated. Enter a zero in columns (c), (d), and (e) (leave column (e) • Be clear, concise, and complete in the description. Avoid blank if Option 1 compensation reporting, described below, is attaching brochures, newsletters, newspaper articles about used) if no hours were entered in column (b) and no the organization, etc. compensation, contributions, expenses, and other allowances 3 Public interest law firm. A public interest law firm exempt under were paid during the year or deferred for payment to a future section 501(c)(3) or (c)(4) must attach a list of all the cases in year. litigation or that have been litigated during the year. For each Show all forms of cash and noncash compensation received case, describe the matter in dispute and explain how the litigation

will benefit the public generally. Also state the fees sought and by each listed officer, director, etc., whether paid currently or

recovered in each case. See Rev. Proc. 92-59, 1992-2 C.B. 411. deferred, as described more fully under the Option 1 and Option

4 If part of the total expenses of any program service consists of 2 instructions below.

grants reported on line 10, enter the amount of grants in the If the organization pays any other person, such as a space provided and include the grants in the Expenses column. If management services company, for the services provided by the amount of grants entered includes foreign grants, check the any of the organization’s officers, directors, trustees, or key box to the left of the entry space for Program Services Expenses. employees, report the compensation and other items in Part IV • Section 501(c)(3) and (4) organizations, and section as if the organization had paid the officers, etc., directly. Also, 4947(a)(1) nonexempt charitable trusts, must show the see Ann. 2001-33, 2001-17 I.R.B. 1137. amount of grants and allocations to others and must enter

the total expenses for each program service reported. A failure to fully complete Part IV can subject both the

• For all other organizations, completing the Program organization and the individuals responsible for such failure to

Services Expenses column (and the Grants entry) in Part III penalties for filing an incomplete return. See General Instruction

is optional. G. In particular, entering the phrase on Part IV, “Information

5 Attach a schedule that lists the organization’s other program available upon request,” or a similar phrase, is not acceptable.

services. In addition to the information required in Part IV, the • The detailed information required for the three largest organization may provide an attachment to explain the entire services is not necessary for this schedule. annual compensation package for any person listed in Part IV. • However, section 501(c)(3) and (4) organizations, and

section 4947(a)(1) nonexempt charitable trusts must show Form 941 must be filed to report income tax withholding and

the expenses attributable to their program services. social security and Medicare taxes. The organization must also

6 The organization may report the amount of any donated services, file Form 940 to report Federal unemployment tax, unless the

or use of materials, equipment, or facilities it received or utilized in organization is not subject to these taxes. See Pub. 15 (Circular

connection with a specific program service. E) for more information.

• Disclose the applicable amounts of any donated services, Amounts paid or accrued by certain other organizations etc., on the lines for the narrative description of the treated as paid or accrued by the filing organization. Treat

appropriate program service. as paid, accrued, or held directly by the organization any • Do not include these amounts in the expense column in Part amounts paid or accrued under a deferred compensation plan, III. or held by a deferred compensation trust, that is established, • See the instructions for line 1, B2. sponsored, or maintained by the organization.

Treat as paid or accrued directly by the organization any

Part IV. List of Officers, Directors, amounts paid or accrued by a common paymaster as defined in

Regulations section 31.3121(s)-1(b) for services performed for Trustees, and Key Employees the organization.

List each person who was an officer, director, trustee, or key Column (a) employee (defined below) of the organization at any time during

the organization’s tax year, even if they did not receive any Report the name and address of each person who was an

compensation from the organization. officer, director, trustee, or key employee (defined above) at

any time during the organization’s tax year.

Beginning in 2008, Form 990-EZ filers have two options Aid in the processing of the organization’s return by grouping for reporting compensation (see the instructions below). TIP together, preferably at the end of the list, those who received no

compensation. Be careful not to repeat names.

Officer. An officer is a person elected or appointed to Use an attachment if there are more than 18 persons to list

manage the organization’s daily operations, such as a in Part IV.

president, vice-president, secretary, or treasurer. The officers of Give the preferred address at which officers, directors, etc.,

an organization may be determined by reference to its want the Internal Revenue Service to contact them, whether

organizing document, bylaws, or resolutions of its governing home address, business address, or the organization’s address

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listed on page 1 of Form 990-EZ. This information, like the other or not funded, vested, or subject to a substantial risk of

information in the Form 990-EZ, will be available to the public. forfeiture; and

5. The annual increase in actuarial value of a non-qualified Column (b) defined benefit plan, whether or not funded, vested, or subject List each person’s title or position with the organization. List all to a substantial risk of forfeiture.

titles or positions if more than one (for instance, President and

Director). Reasonable estimates may be used if precise cost figures are

not readily available to determine column (d) amounts. In column (b), a numerical estimate of the average hours per

week devoted to the position is required for a complete answer. Option 1 – column (e). Leave column (e) blank.

Statements such as “as needed” or “as required” or “40+” are Option 2 (Pre-2008 Method). For purposes of reporting all

unacceptable. amounts in columns (b) through (e) in Part IV, fiscal-year

Two methods to report compensation in columns (c)–(e). organizations may either use their tax year, or the calendar year

The organization may report the compensation of officers, ending within such tax year. Whichever year is selected (tax

year or calendar year) must be used consistently from year to directors, trustees, and key employees in accordance with year, and must be used for all officers, directors, trustees, and either Option 1 or Option 2. Option 1 is similar to the 2008 Form key employees (and, for 501(c)(3) organizations, for their five 990 method of compensation reporting but simplified. Option 2 highest compensated employees in Part VI). is essentially the 2007 Form 990-EZ method of compensation

reporting. Whichever option is selected for 2008 must be used Option 2 – column (c). For each person listed, report salary,

consistently from year to year, and must be used for all officers, fees, bonuses, and severance payments paid. Include

directors, trustees, and key employees (and, for section current-year payments of amounts reported or reportable as

501(c)(3) organizations, for their five highest compensated deferred compensation in any prior year.

employees in Part VI). Option 2 – column (d). Include in this column all forms of

Option 1 (Form W-2 Method). All compensation reporting deferred compensation and future severance payments

under Option 1 is based on the calendar year ending with or (whether or not funded; whether or not vested; and whether or

within the organization’s tax year. For example, if a fiscal-year not the deferred compensation plan is a qualified plan under

organization’s tax year is the 12-month period ending June 30, section 401(a)). Include also payments to welfare benefit plans

2009, the organization must report compensation for the on behalf of the officers, etc. Such plans provide benefits such

calendar year ending December 31, 2008. as medical, dental, life insurance, severance pay, disability, etc.

Option 1 – column (c). Report the person’s reportable Reasonable estimates may be used if precise cost figures are

compensation. Reportable compensation consists of: not readily available.

• For officers and other employees – amounts required to be Unless the amounts were reported in column (c), report, as

reported in box 5 of Form W-2; deferred compensation in column (d), salaries and other • For directors and individual trustees – amounts required to compensation earned during the period covered by the return,

be reported in box 7 of Form 1099-MISC (plus box 5 of Form but not yet paid by the date the organization files its return.

W-2 if also compensated as an officer or employee); and Option 2 – column (e). Enter both taxable and nontaxable • For institutional trustees (such as banks or trust companies) fringe benefits, other than: – fees for services paid pursuant to a contractual agreement or 1. Working condition fringe benefits described in section statutory entitlement. 132(d), If the organization did not file a Form 1099-MISC because 2. Expense reimbursements and allowances under an the amounts paid were below the threshold reporting accountable plan described in Regulations section 1.62-2(c)(2), requirement, then include and report the amount actually paid. and

Corporate officers are considered employees for 3. De minimis fringe benefits described in section 132(e).

purposes of Form W-2 reporting, unless they perform no Include amounts that the recipients must report as income on services as officers, or perform only minor services and

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their separate income tax returns. Examples include amounts neither receive nor are entitled to receive, directly or indirectly, for which the recipient did not account to the organization or any compensation. Corporate directors are considered allowances that were more than the payee spent on serving the independent contractors, not employees, and director organization. Include payments made under indemnification compensation, if any, generally is required to be reported on arrangements, the value of the personal use of housing, Form 1099-MISC. See Regulations section 31.3401(c)-1(f). automobiles, or other assets owned or leased by the

For certain kinds of employees, such as certain members of organization (or provided for the organization’s use without

the clergy and religious workers who are not subject to social charge), as well as any other taxable and nontaxable fringe

security and Medicare taxes as employees, box 5 of Form W-2 benefits. See Pub. 525, Taxable and Nontaxable Income, for

may be zero or blank. In such case, the amount required to be more information.

reported in box 1 of Form W-2 must be reported as reportable

compensation in column (c). Part V. Other Information

Option 1 – column (d). Report the following items of deferred See the beginning of the Part VI instructions for required compensation and benefits: statements for certain organizations regarding personal benefit

1. Tax-deferred contributions by the employer to a qualified contracts and Schedule A filing.

defined-contribution retirement plan; Line 33. Change in Activities 2. The annual increase in actuarial value of a qualified

defined benefit plan, whether or not funded or vested; Attach a statement to describe any significant activities initiated

3. The value of health benefits provided by the employer, during the past 3 years that were not previously reported to the

IRS on Form 990-EZ or Form 990. Also describe significant that are not included in reportable compensation. For this

purpose, health benefits provided by the employer include activities that were discontinued.

payments of health benefit plan premiums, medical Line 34. Changes in Organizing or Governing reimbursement and flexible spending programs, and the value Documents of health coverage (rather than actual benefits paid) provided Attach a conformed copy of any changes to the articles of by an employer’s self-insured or self-funded arrangement.

Health benefits include dental, optical, drug, and medical incorporation, articles of association, constitution, trust

instrument, or other organizing document, or the bylaws or equipment benefits. They do not include disability or long-term other governing document. care insurance premiums or benefits for this purpose;

4. Tax-deferred contributions by the employer and A conformed copy is one that agrees with the original

employee to a non-qualified defined contribution plan, whether document and all amendments to it. If the copies are not

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signed, they must be accompanied by a written declaration the organization had $1,000 or more of unrelated business

signed by an officer authorized to sign for the organization, income. See also Rev. Proc. 98-19, 1998-1 C.B. 547.

certifying that they are complete and accurate copies of the Exception 1. Section 6033(e)(3) exception for original documents. Photocopies of articles of incorporation nondeductible dues. showing the certification of an appropriate state official need not 1. All organizations exempt from tax under section 501(a), be accompanied by such a declaration. See Rev. Proc. 68-14, other than section 501(c)(4), (5), and (6) organizations; 1968-1 C.B. 768, for details. When a number of changes are 2. Local associations of employees’ and veterans’ made, attach a copy of the entire revised organizing instrument organizations described in section 501(c)(4), but not section or governing document. 501(c)(4) social welfare organizations; However, if the exempt organization changes its legal 3. Labor unions and other labor organizations described in structure, such as from a trust to a corporation, the new legal section 501(c)(5), but not section 501(c)(5) agricultural and entity must file a new exemption application to establish that it horticultural organizations; qualifies for exemption. 4. Section 501(c)(4), (5), and (6) organizations that receive

Line 35. Unrelated Business Income and more than 90% of their dues from:

Lobbying Proxy Tax a. Section 501(c)(3) organizations,

b. State or local governments,

Unrelated Business Income c. Entities whose income is exempt from tax under section

115, or Political organizations described in section 527 are not required d. Organizations described in 1 through 3, above; to answer this question. 5. Section 501(c)(4) and (5) organizations that receive more Check “Yes” on line 35a if the organization’s total gross than 90% of their annual dues from: income from all of its unrelated trades and businesses is $1,000 a. Persons, or more for the tax year. Gross income is gross receipts less b. Families, or the cost of goods sold. See Pub. 598, Tax on Unrelated c. Entities Business Income of Exempt Organizations, for a description of that each paid annual dues of $97 or less in 2008 (adjusted unrelated business income, and see Instructions for the Form annually for inflation). See Rev. Proc. 2007-66; 990-T for the filing requirements of Form 990-T. 6. Any organization that receives a private letter ruling from If the organization had income from business activities, such the IRS stating that the organization satisfies the section as those reported on lines 2, 6, and 7 (among others), but not 6033(e)(3) exception; reported on Form 990-T, attach a statement explaining the 7. Any organization that keeps records to substantiate that reasons for not reporting the income on Form 990-T. 90% or more of its members cannot deduct their dues (or

Neither Form 990-T nor Form 990-EZ is a substitute for the similar amounts) as business expenses whether or not any part

other. Items of income and expense reported on Form 990-T of their dues are used for lobbying purposes; or

must also be reported on Form 990-EZ (and vice versa) when 8. Any organization that is not a membership organization.

the organization is required to file both forms.

Special rules treat affiliated social welfare organizations, All tax-exempt organizations must pay estimated taxes

with respect to their unrelated business income if they agricultural and horticultural organizations, and business CAUTION leagues as parts of a single organization for purposes of

! CAUTION expect their tax liability to be $500 or more. Use Form

!

meeting the nondeductible dues exception. See Rev. Proc. 990-W to compute these amounts. 98-19, 1998-1 C.B. 547. . Section 6033(e) Tax for Lobbying Expenditures Exception 2. Section 6033(e)(1) $2,000 in-house lobbying If the organization checks “No” to line 35a, it is certifying that exception. An organization satisfies the $2,000 in-house the organization was not subject to the notice and reporting lobbying exception if it: requirements of section 6033(e) and that the organization had 1. Did not receive a waiver for proxy tax owed for the prior no lobbying and political expenditures potentially subject to the year; proxy tax. 2. Did not make any political expenditures or foreign Section 6033(e) notice and reporting requirements and lobbying expenditures during the current tax year; and proxy tax. Section 6033(e) requires certain section 501(c)(4), 3. Incurred lobbying expenses during the current tax year (5), and (6) organizations to tell their members the portion of consisting only of in-house direct lobbying expenses totaling their membership dues that were allocable to the political or $2,000 or less, but excluding: lobbying activities of the organization. If an organization does a. Any allocable overhead expenses, and not give its members this information, then the organization is b. All direct lobbying expenses of any local council subject to a proxy tax. The tax is reported on Form 990-T. regarding legislation of direct interest to the organization or its If the organization checks “Yes” on line 35a to declare that it members.

had reportable section 6033(e) lobbying and political expenses

in the tax year (and potential liability for the proxy tax): Definitions

1. Complete Parts III-A and III-B of Schedule C (Form 990 Grassroots lobbying. Refers to attempts to influence any or 990-EZ), Political Campaign and Lobbying Activities (see segment of the general public regarding legislative matters or instructions); and referendums. 2. Attach this schedule to Form 990-EZ. Direct lobbying includes attempting to influence:

Only the following tax-exempt organizations are subject to • Legislation through communication with legislators and other

the section 6033(e) notice and reporting requirements, and a government officials, and

potential proxy tax: • The official actions or positions of covered executive branch

• 501(c)(4) social welfare organizations, officials through direct communication.

• 501(c)(5) agricultural and horticultural organizations, and Direct lobbying does not include attempting to • 501(c)(6) organizations. influence:

If the organization is not tax-exempt under sections • Any local council on legislation of direct interest to the

501(c)(4), (5), or (6), check “No” on line 35a, unless it had organization or its members, and

$1,000 or more of unrelated business income. • The general public regarding legislative matters (grassroots

lobbying). If the organization meets Exception 1 or 2 below, it is

excluded from the notice, reporting, and proxy tax requirements Other lobbying includes:

of section 6033(e), and it should check “No” to line 35a, unless • Grassroots lobbying,

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• Foreign lobbying, Section 501(c)(3) organizations. A section 501(c)(3)

• Third-party lobbying, and organization will lose its tax-exempt status if it engages in

• Dues paid to another organization that were used to lobby. political activity.

In-house expenditures include: A section 501(c)(3) organization must pay a section 4955

• Salaries, and excise tax for any amount paid or incurred on behalf of, or in

• Other expenses of the organization’s officials and staff opposition to, any candidate for public office. The organization

(including amounts paid or incurred for the planning of must pay an additional excise tax if it fails to correct the

expenditure timely. legislative activities).

A manager of a section 501(c)(3) organization who In-house expenditures do not include: knowingly agrees to a political expenditure must pay a section • Any payments to other taxpayers engaged in lobbying or 4955 excise tax, unless the agreement is not willful and there is political activities as a trade or business. reasonable cause. A manager who does not agree to a • Any dues paid to another organization that are allocable to correction of the political expenditure may have to pay an lobbying or political activities. additional excise tax.

Line 36. Liquidation, Dissolution, Termination, When an organization promotes a candidate for public office

or Substantial Contraction (or is used or controlled by a candidate or prospective

If there was a liquidation, dissolution, termination, or substantial candidate), amounts paid or incurred for the following purposes

contraction, state “Yes” and complete and attach the applicable are political expenditures:

parts of Schedule N. • Remuneration to such individual (a candidate or prospective

candidate) for speeches or other services; For a complete liquidation, dissolution, termination, or • Travel expenses of such individual; cessation of operations, also check the Termination box in the • Expenses of conducting polls, surveys, or other studies, or heading of the return. preparing papers or other material for use by such individual;

A substantial contraction is a partial liquidation or other • Expenses of advertising, publicity, and fundraising for such

major disposition of assets except transfers for full individual; and

consideration or distributions from current income. • Any other expense that has the primary effect of promoting

public recognition or otherwise primarily accruing to the benefit A major disposition of assets means one or more of such individual. dispositions for the tax year that: An organization is effectively controlled by a candidate or 1. Amount to more than 25% of the fair market value of the prospective candidate only if such individual has a continuing, organization’s net assets at the beginning of the tax year; or substantial involvement in the day-to-day operations or 2. Are one of a series of related dispositions begun in earlier management of the organization. years that add up to more than 25% of the net assets the A determination of whether the primary purpose of an organization had at the beginning of the tax year when the first organization is promoting the candidacy or prospective disposition in the series was made. Whether a major disposition candidacy of an individual for public office is made on the basis of assets took place through a series of related dispositions of all the facts and circumstances. See section 4955 and depends on the facts in each case. Regulations section 53.4955.

An organization filing Form 990-EZ need not complete Use Form 4720 to figure and report these excise taxes.

Part II of Schedule N for a transaction that is not a Line 38. Loans To or From Officers, Directors, substantial contraction.

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Trustees, and Key Employees

Line 37. Expenditures for Political Purposes Enter the end-of-year unpaid balance of secured and

unsecured loans made to or received from officers, directors, Political organizations described in section 527 are not trustees, and key employees (as defined in Part IV above). For required to answer this question. example, if the organization borrowed $1,000 from one officer

A political expenditure is one intended to influence the and loaned $500 to another, none of which has been repaid,

selection, nomination, election, or appointment of anyone to a report $1,500 on line 38b.

federal, state, or local public office, or office in a political For loans outstanding at the end of the year, complete and organization, or the election of Presidential or Vice-Presidential attach Part II of Schedule L (Form 990 or 990-EZ), Transactions electors. It does not matter whether the attempt succeeds. with Interested Persons. See the Schedule L instructions.

An expenditure includes a payment, distribution, loan, Report any interest expense paid to an officer, director, advance, deposit, or gift of money, or anything of value. It also trustee, or key employee on line 16 (except for mortgage includes a contract, promise, or agreement to make an interest reportable on line 14) and any interest income paid by expenditure, whether or not legally enforceable. an officer, director, trustee, or key employee on line 8.

All section 501(c) organizations. An exempt organization Line 39. Section 501(c)(7) Organizations that is not a political organization must file Form 1120-POL if it

is treated as having political organization taxable income under Gross receipts test. See Appendix C for discussion of the

gross receipts test for purposes of determining exemption under section 527(f)(1). section 501(c)(7). This definition of gross receipts differs from If a section 501(c) organization establishes and maintains a the definition for purposes of Header Item L and determining section 527(f)(3) separate segregated fund, it is the fund’s whether the organization must file Form 990 or 990-EZ. responsibility to file its own Form 1120-POL if the fund meets Line 39a. Include on line 39a capital contributions, initiation the Form 1120-POL filing requirements. Do not include the fees, and unusual amounts of income not included in gross segregated fund’s receipts, expenditures, and balance sheet receipts. items on the Form 990-EZ of the section 501(c) organization

that establishes and maintains the fund. When answering Line 39b. Gross receipts for public use of club facilities are

question 37 on its Form 990-EZ, the section 501(c) organization gross receipts (as defined above for 501(c)(7) exemption

purposes) derived from the use of the organization’s facilities should disregard the political expenses and Form 1120-POL from persons other than members, spouses of members, filing requirement of the segregated fund. However, when a dependents of members, or guests of members. section 501(c) organization transfers its own funds to a

separate segregated section 527(f)(3) fund for use as political Investment income and Form 990-T. Include the income

expenses, the 501(c) organization must report the transferred shown on Line 39b on the club’s Form 990-T if the club is

funds as its own political expenses on its Form 990-EZ. required to file Form 990-T. Investment income earned by a

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section 501(c)(7) organization is not tax-exempt income unless compensation to that person, including the reimbursement, is

it is set aside for one or more of the following purposes: reasonable.

religious, charitable, scientific, literary, educational purposes, or Line 40e. Tax on Prohibited Tax Shelter prevention of cruelty to children or animals. Transactions If the combined amount of an organization’s gross Answer “Yes” if the organization was a party to a prohibited tax investment income and other unrelated business income

exceeds $1,000, it must report the investment income and other shelter transaction as described in section 4965(e) at any time

unrelated business income on Form 990-T. during the organization’s tax year. An organization that files

Form 990-EZ (other than a section 527 political organization or Nondiscrimination policy. A section 501(c)(7) organization is a section 4947(a)(1) trust) and that is a party to a prohibited tax not exempt from income tax if any written policy statement, shelter transaction must file Form 8886-T and may also have to including the governing instrument and bylaws, allows file Form 4720 and pay excise tax imposed by section 4965. discrimination on the basis of race, color, or religion. For more information, see the instructions to Forms 8886-T and

However, section 501(i) allows social clubs to retain their 4720.

exemption under section 501(c)(7) even though their

membership is limited (in writing) to members of a particular Line 41. List of States

religion, if the social club: List each state with which the organization is filing a copy of this

1. Is an auxiliary of a fraternal beneficiary society exempt return in full or partial satisfaction of state filing requirements.

under section 501(c)(8), and Line 42a. Location of Books and Records 2. Limits its membership to the members of a particular Provide the name of the person who possesses the books and religion; or the membership limitation is: records. The organization is not required to provide the address a. A good-faith attempt to further the teachings or principles or telephone number for the personal residence of an individual. of that religion, and The organization’s address and phone number may be used b. Not intended to exclude individuals of a particular race or instead, or the business address and telephone number of such color. individual.

Line 40a. Section 501(c)(3) Organizations: Line 42b. Foreign Financial Accounts

Disclosure of Excise Taxes Imposed under Answer “Yes” if either item 1 or 2 below applies:

Section 4911, 4912, or 4955 1. At any time during the calendar year (ending with or

Section 501(c)(3) organizations must disclose any excise tax within the organization’s tax year), the organization had an

imposed during the year under section 4911 (excess lobbying interest in, or signature or other authority over, a financial

expenditures), 4912 (disqualifying lobbying expenditures), or, account in a foreign country (such as a bank account, securities

unless abated, 4955 (political expenditures). See sections 4962 account, or other financial account); and

and 6033(b). a. The combined value of the accounts was more than

$10,000 at any time during the calendar year; and Line 40b. Section 501(c)(3) and 501(c)(4) b. The accounts were not with a U.S. military banking facility Organizations: Disclosure of Section 4958 operated by a U.S. financial institution. Excess Benefit Transactions and Excise Taxes 2. The organization owns more than 50% of the stock in any

Sections 6033(b) and 6033(f) require section 501(c)(3) and (4) corporation that would answer “Yes” to item 1 above.

organizations to report the amount of taxes imposed under

section 4958 (excess benefit transactions) involving the If the “Yes” box is checked, enter the name of the foreign

organization, unless abated, as well as any other information country or countries. Attach a separate sheet if more space is

needed. the Secretary may require concerning those transactions.

If the organization answers “Yes,” then complete and attach File Form TD F 90-22.1, Report of Foreign Bank and

Part I of Schedule L (Form 990 or 990-EZ), Transactions with Financial Accounts by June 30 after the end of the calendar

Interested Persons. year with the Department of the Treasury at the address shown

on the form. Form TD F 90-22.1 is available by calling An excess benefit transaction may have serious 1-800-TAX-FORM (1-800-829-3676) or by downloading it from implications for the disqualified person that entered into the IRS website at www.irs.gov. Do not file it with the IRS or the transaction with the organization, any organization

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attach it to Form 990-EZ. managers that knowingly approved of the transaction, and the

organization itself. A section 501(c)(3) or 501(c)(4) organization Line 43. Section 4947(a)(1) Nonexempt

that becomes aware that it may have engaged in an excess Charitable Trusts

benefit transaction should obtain competent advice regarding A section 4947(a)(1) nonexempt charitable trust that has no section 4958, consider pursuing correction of any excess taxable income under Subtitle A may use Form 990-EZ to meet benefit, and take other appropriate steps to protect its interests its section 6012 filing requirement by checking the box on line with regard to such transaction and the potential impact it could 43 (in which case Form 1041 is not required). In such case, have on the organization’s continued exempt status. See enter on line 43 the total of exempt-interest dividends received Appendix E for a discussion of section 4958, and Schedule L, or accrued (if reporting under the accrual method of accounting) Part I, regarding reporting of excess benefit transactions. during the tax year. Such tax-exempt interest includes

Line 40c. Taxes Imposed on Organization exempt-interest dividends received from a mutual fund or other

Managers or Disqualified Persons regulated investment company as well as tax-exempt interest

received directly. For line 40c, enter the amount of taxes imposed on organization

managers and/or disqualified persons under sections 4912, Line 44. Donor Advised Funds

4955, and 4958, unless abated.

A sponsoring organization of a donor advised fund must Line 40d. Taxes Reimbursed by the Organization file Form 990 rather than Form 990-EZ, regardless of For line 40d, enter the amount of tax on line 40c that was CAUTION the amount of its gross receipts or net assets.

!

reimbursed by the organization. Any reimbursement of the

excise tax liability of a disqualified person or organization A sponsoring organization is any of the following types of

manager will be treated as an excess benefit unless (1) the organizations if it maintains one or more donor advised funds:

organization treats the reimbursement as compensation during 1. A section 501(c)(3) public charity described in section

the year the reimbursement is made, and (2) the total 509(a)(1), (2), or (3).

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2. A veterans’ organization, organized in the United States remove such trustee or director and designate a new trustee or

or any of its possessions, no part of the net earnings of which director.

inures to the benefit of any private shareholder or individual,

that meets the requirements to receive deductible contributions Part VI. Section 501(c)(3) Organizations under section 170(c)(3).

3. A domestic fraternal organization described in section Only

501(c)(8) or (10) that uses charitable contributions exclusively All section 501(c)(3) organizations and 4947(a)(1) trusts must

for charitable purposes. complete Part VI.

4. A cemetery company described in section 501(c)(13). Required Statements

A “donor advised fund” is a fund or account: 1. Schedule A attachment. Section 501(c)(3) organizations

1. That is separately identified by reference to contributions and section 4947(a)(1) nonexempt charitable trusts must

of a donor or donors, complete and attach Schedule A (Form 990 or 990-EZ), Public

2. That is owned and controlled by a sponsoring Charity Status and Public Support.

organization, and 2. Statement regarding personal benefit contract. If, in

3. For which the donor or donor advisor has or reasonably connection with a transfer of funds to the organization, the

expects to have advisory privileges in the distribution or organization directly or indirectly pays premiums on any

investment of amounts held in the donor advised funds or personal benefit contract, or there is an understanding or

accounts because of the donor’s status as a donor. expectation that any person will directly or indirectly pay such

premiums, the organization must do the following: A donor advised fund does not include any fund or account: • Attach a statement describing the organization’s

1. That makes distributions only to a single identified involvement with the personal benefit contract(s);

organization or governmental entity, or • Report on Form 8870 the premiums that the organization

2. In which a donor or donor advisor gives advice about paid, and the premiums paid by others but treated as paid by

which individuals receive grants for travel, study, or other the organization; and

similar purposes, if: • Report and pay an excise tax, equal to premiums paid, on

Form 4720. a. The donor or donor advisor’s advisory privileges are

performed exclusively by such person in his or her capacity as A personal benefit contract is generally any life insurance, a committee member in which all of the committee members annuity, or endowment contract that benefits, directly or are appointed by the sponsoring organization; indirectly, the transferor, a member of the transferor’s family, or b. No combination of donors or donor advisors (and related any other person designated by the transferor (other than an persons as defined below) directly or indirectly control the organization described in section 170(c)). See section committee; and 170(f)(10); Notice 2000-24, 2000-1 C.B. 952; and c. All grants from the fund or account are awarded on an Announcement 2000-82, 2000-2 C.B. 385. objective and nondiscriminatory basis following a procedure

approved in advance by the board of directors of the sponsoring Line 46. Political Campaign Activities organization. The procedure must be designed to ensure that Answer “Yes” and complete Part I of Schedule C (Form 990 or all grants meet the requirements of sections 4945(g)(1), (2), or 990-EZ), Political Campaign and Lobbying Activities, if the (3); or organization participated or intervened in (including the 3. That the Secretary exempts from being treated as a publishing of statements) any political campaign on behalf of (or donor advised fund because either such fund or account is in opposition to) any candidate for public office, directly or advised by a committee not directly or indirectly controlled by indirectly. See the Schedule C instructions for a discussion of the donor or donor advisor or such fund benefits a single political campaign activity. identified charitable purpose. For example, see Notice

2006-109, 2006-51 I.R.B. 1121, and any future related Line 47. Lobbying Activities guidance. Answer “Yes” and complete Part II of Schedule C (Form 990 or

990-EZ) if the organization engaged in lobbying activities. See A “donor advisor” is any person appointed or designated by the Schedule C instructions for a discussion of lobbying a donor to advise a sponsoring organization on the distribution activities. or investment of amounts held in the donor’s donor advised

fund or similar account. Line 48. School

Line 45. Section 512(b)(13) Controlled Entity Answer “Yes” and complete Schedule E (Form 990 or 990-EZ),

Schools, if the organization checked the box on line 2 of

A controlling organization of a controlled entity under Schedule A (Form 990 or 990-EZ), Public Charity Status and

Public Support, Part I, indicating that it is a school. section 512(b)(13) must file Form 990 rather than Form CAUTION 990-EZ if there was any transfer of funds between the

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Line 49. Transfers to Exempt Non-Charitable controlling organization and any controlled entity during the Related Organizations year. Answer “Yes” if the organization made any transfer to a related The controlled entity may be a stock or nonstock organization that is an exempt organization other than a corporation, association, partnership, limited liability company, 501(c)(3) organization, such as a related 501(c)(4) organization or trust. Control exists if the controlling organization owns more or a related 527 political organization. than 50% of:

• The stock of a corporation (measured by voting power or A transfer for this purpose is any transaction or arrangement

value), in which the organization transferred something of value (cash,

• The profits or capital interest in a partnership, or other assets, services, use of property, etc.) to the exempt

• The beneficial interest in a trust or other entity. non-charitable related organization, whether or not for adequate

consideration. The organization may (but is not required to) Control of a nonstock corporation means that over 50% of its explain the transfer in an attachment. directors or trustees are either representatives of, or directly or

indirectly controlled by, the controlling organization. A trustee or A related organization for this purpose is an organization

director is a representative of an exempt organization whenever with either of the following relationships to the filing organization

at any time during the organization’s tax year: such a person is a trustee, director, agent, or employee of such

exempt organization. A trustee or director is controlled by an 1. The two organizations share some element of common

exempt organization if such organization has the power to control, or

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2. A historic and continuing relationship exists between the consisting of the $80,000 salary and $2,000 bonus; and

two organizations. $20,000 under column (d), consisting of the employer’s

payments of $5,000 to the retirement plan, $10,000 to the An element of common control is present when one or more health plan, and $5,000 of educational benefits. Total of the officers, directors, or trustees of one organization are compensation of S would be $102,000. Thus, under Option 2, S elected or appointed by the officers, directors, trustees, or would be listed in line 50 as one of the five highest members of the other. An element of common control is also compensated employees unless there are five other employees present when more than 25% of the officers, directors, or (other than key employees) with higher compensation. trustees of one organization serve as officers, directors, or See Pub. 525, Taxable and Nontaxable Income, for more trustees of the other organization. information. 

A historic and continuing relationship exists when two

organizations participate in a joint effort to work in concert Line 51. Five Highest Compensated Independent

toward the attainment of one or more common purposes on a Contractors over $100,000

continuous or recurring basis rather than on the basis of one or Complete this table for the five highest compensated several isolated transactions or activities. Such a relationship independent contractors that received more than $100,000 in also exists when two organizations share facilities, equipment, compensation for services, whether professional services or or paid personnel during the year, regardless of the length of other services, from the organization. At the bottom of the table, time the arrangement is in effect. enter the number of other independent contractors with annual

Line 50. Five Highest Compensated Employees compensation over $100,000 who are not individually listed.

over $100,000 Independent contractors include organizations as well as

individuals and may include professional fundraisers, law firms, Complete this table for the five employees (other than officers, accounting firms, publishing companies, management directors, trustees, and key employees as defined in Part IV companies, and investment management companies. See Pub. above) with the highest annual compensation over $100,000. At 1779, Independent Contractor or Employee, and Pub. 15-A, the bottom of the table, enter the number of other employees Employer’s Supplemental Tax Guide, for distinguishing (other than officers, directors, trustees, and key employees) employees from independent contractors. Any compensation with annual compensation over $100,000 who are not received by an officer, director, trustee, key employee, or individually listed. highest compensated employee in the capacity as an Determination of the five highest compensated employees independent contractor must be included in such person’s depends on whether the organization uses Option 1 or Option 2 compensation reported in Part IV, or Part VI, line 50. for Part IV compensation reporting. Whichever option is Fiscal-year organizations must use the same year (whether selected must be used for both Part IV and Part VI tax year or calendar year ending within the tax year) as is used compensation reporting. in Part IV for determining their five highest compensated Under Option 1, a fiscal-year organization must use the independent contractors and reporting their compensation in calendar year ending within its tax year to determine its five such year. highest compensated employees over $100,000, and to report Column (C). Compensation. Enter the amount of such compensation. Combine the compensation includible in compensation the organization paid or incurred for the columns (c) and (d) in determining whether compensation applicable year. If the organization uses the calendar year and exceeds $100,000 for the calendar year. the cash method of accounting, report the amount reported on Under Option 2, a fiscal-year organization may determine Form 1099-MISC, box 7, if filed. Otherwise, report the amount the five highest compensated employees over $100,000 for its paid pursuant to the parties’ agreement or applicable state law. tax year, or for the calendar year ending within its tax year. Use

the same year as was used in reporting compensation for Form 1099-MISC is not always required to be issued for

officers, directors, trustees, and key employees in Part IV. payments to an independent contractor.

Combine compensation includible in columns (c), (d), and (e) in

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determining whether compensation exceeds $100,000. Compensation includes fees and similar payments to See the Part IV instructions for more information on Option 1 independent contractors but not reimbursement of expenses. and Option 2 compensation reporting and for filling out the table However, for this purpose, the organization must report the columns (a) through (e) of line 50. gross payment to the independent contractor that includes

Example. S is not a key employee. The organization uses a expenses and fees if the expenses are not separately reported

calendar tax year. During the year, S received a salary of to the organization.

$80,000 and a $2,000 bonus. S contributed $5,000 of the salary

on a pre-tax basis to a qualified defined-contribution retirement Signature Block plan, and received a matching employer contribution of $5,000 To make the return complete, an officer of the organization from the organization. S contributed another $5,000 of the authorized to sign it must sign in the space provided. For a salary on a pre-tax basis to a qualified health plan. S received corporation or association, this officer may be the president, from the employer non-taxable health benefits for herself and vice president, treasurer, assistant treasurer, chief accounting her family of $10,000, and non-taxable family educational officer, or other corporate or association officer, such as a tax benefits of $5,000. officer. A receiver, trustee or assignee must sign any return he

To determine whether S is to be listed as among the five or she files for a corporation or association. For a trust, the

highest compensated employees under Option 1, S’s authorized trustee(s) must sign. compensation in column (c) would be $82,000, the amount Paid Preparer reportable in Form W-2, box 5, consisting of the $80,000 salary

(including her contributions to the qualified plans) and the Generally, anyone who is paid to prepare the return must sign

$2,000 bonus. S’s compensation in column (d) would be the return and fill in the other blanks in the Paid Preparer’s Use

$15,000, consisting of the organization’s payments of $5,000 to Only area. An employee of the filing organization is not a paid

the retirement plan and $10,000 to the health plan. Thus, under preparer.

Option 1, S’s total compensation of $97,000 would not place The paid preparer must: her among the five highest compensated employees over • Sign the return in the space provided for the preparer’s $100,000. signature,

To determine whether S is to be listed as among the five • Enter the preparer information (other than PTIN and EIN

highest compensated employees under Option 2, S would have blocks, except as described below), and

the following compensation: $82,000 under column (c), • Give a copy of the return to the organization.

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The paid preparer must enter the preparer’s identifying By checking this box “Yes,” the organization is authorizing

taxpayer identification number and the preparer’s firm’s EIN the IRS to contact the paid preparer to answer any questions

only if filing Form 990-EZ for a section 4947(a)(1) nonexempt that may arise during the processing of the return. The

charitable trust that is not filing Form 1041. The preparer’s organization is also authorizing the paid preparer to:

identifying number is the preparer’s social security number or • Give the IRS any information that is missing from the return,

the preparer’s taxpayer identification number (PTIN), if • Call the IRS for information about the processing of the obtained. return, and

The IRS is not authorized to redact the paid preparer’s • Respond to certain IRS notices about math errors, offsets,

social security number if such SSN is entered in the paid and return preparation.

CAUTION preparer’s block. Because the Form 990-EZ is a publicly

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The organization is not authorizing the paid preparer to bind disclosable document, any information entered in this block will the organization to anything or otherwise represent the be publicly disclosed (see Appendix D). Accordingly, any paid organization before the IRS. preparer whose identifying number must be listed on the Form

990 may wish to apply for and obtain a PTIN using Form W-7P, The authorization will automatically end no later than the due Application for Preparer Tax Identification Number. date (excluding extensions) for filing the organization’s 2009

Form 990-EZ. If the organization wants to expand the paid Paid Preparer Authorization preparer’s authorization or revoke the authorization before it On the last line of Part II, check “Yes” if the IRS may contact the ends, see Pub. 947, Practice Before the IRS and Power of paid preparer who signed the return to discuss the return. This Attorney. authorization applies only to the individual whose signature

appears in the “Paid Preparer’s Use Only” section of the Form Check “No” if the IRS is to contact the organization at the

990-EZ. It does not apply to the firm, if any, shown in that address or telephone number listed in the heading, rather than

section. the paid preparer.

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Appendix of Special Instructions to Form

990-EZ

Contents

A Exempt Organizations Reference Chart

B How to Determine Whether an Organization’s Gross Receipts Are Normally $25,000 (or $5,000) or Less

C Special Gross Receipts Test for Determining Exempt Status of Section 501(c)(7) and Section 501(c)(15) Organizations

D Public Inspection of Returns

E Section 4958 Excess Benefit Transactions

F Forms and Publications To File or Use

G Use of Form 990, or Form 990-EZ, To Satisfy State Reporting Requirements

Appendix A: Exempt Organizations

Reference Chart

 To determine how the instructions for Form 990-EZ apply to the organization, an organization must know the Code section under which the

organization is exempt. 

Type of Organization I.R.C. Section

Corporations Organized Under Act of Congress 501(c)(1)

Title Holding Corporations 501(c)(2)

Charitable, Religious, Educational, Scientific, etc. Organizations 501(c)(3)

Civic Leagues and Social Welfare Organizations 501(c)(4)

Labor, Agricultural, and Horticultural Organizations 501(c)(5)

Business Leagues, etc. 501(c)(6)

Social and Recreation Clubs 501(c)(7)

Fraternal Beneficiary and Domestic Fraternal Societies and 501(c)(8) & (c)(10)

Associations

Voluntary Employees’ Beneficiary Associations 501(c)(9)

Teachers’ Retirement Fund Associations 501(c)(11)

Benevolent Life Insurance Associations, Mutual Ditch or Irrigation 501(c)(12)

Companies, Mutual or Cooperative Telephone Companies, etc.

Cemetery Companies 501(c)(13)

State Chartered Credit Unions, Mutual Reserve Funds 501(c)(14)

Insurance Companies or Associations Other than Life 501(c)(15)

Cooperative Organizations to Finance Crop Operations 501(c)(16)

Supplemental Unemployment Benefit Trusts 501(c)(17)

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Type of Organization I.R.C. Section

Employee Funded Pension Trusts (created before 6/25/1959) 501(c)(18)

Organizations of Past or Present Members of the Armed Forces 501(c)(19) & (c)(23)

Black Lung Benefit Trusts 501(c)(21)

Withdrawal Liability Payment Funds 501(c)(22)

Title Holding Corporations or Trusts 501(c)(25)

State-Sponsored Organizations Providing Health Coverage for 501(c)(26)

High-Risk Individuals

State-Sponsored Workmen’s Compensation and Insurance and 501(c)(27)

Reinsurance Organizations

Religious and Apostolic Associations 501(d)

Cooperative Hospital Service Organizations 501(e)

Cooperative Service Organizations of Operating Educational 501(f)

Organizations

Child Care Organizations 501(k)

Charitable Risk Pools 501(n)

Political Organizations 527

applies in other situations in which one organization collects Appendix B: How to Determine Whether funds merely as an agent for another.

an Organization’s Gross Receipts Are Figuring Gross Receipts Normally $25,000 (or $5,000) or Less Figure gross receipts for Form 990 and Form 990-EZ as To figure whether an organization has to file Form 990-EZ (or follows.

Form 990), apply the $25,000 (or $5,000) gross receipts test

(below) using the following definition of gross receipts and Form 990. Gross receipts are the sum of lines 6b (both

columns), 7b (both columns), 8b, 9b, 10b, and 12, Column A of information in Figuring Gross Receipts below.

Form 990, Part VIII.

Gross Receipts Form 990-EZ. Gross receipts are the sum of lines 5b, 6b, 7b, Gross receipts are the total amounts the organization received and 9 of Form 990-EZ, Part I. from all sources during its annual accounting period, without

subtracting any costs or expenses. Example. Organization M reported $50,000 as total

revenue on line 9 of its Form 990-EZ. M added back the costs

Do not use the definition of gross receipts described in and expenses it had deducted on lines 5b ($2,000); 6b

Appendix C, Special Gross Receipts Test for ($1,500); and 7b ($500) to its total revenue of $50,000 and

Determining Exempt Status of Section 501(c)(7) and determined that its gross receipts for the tax year were $54,000. CAUTION

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Section 501(c)(15) Organizations, to figure gross receipts for

this purpose. That test is limited to determining exempt status of $25,000 Gross Receipts Test

such organizations. To determine whether an organization’s gross receipts are

Gross receipts when acting as an agent. If a local chapter normally $25,000 or less, apply the following test. An

of a section 501(c)(8) fraternal organization collects insurance organization’s gross receipts are considered normally to be

premiums for its parent lodge and merely sends those $25,000 or less if the organization is:

premiums to the parent without asserting any right to use the 1. Up to a year old and has received, or donors have

funds or otherwise deriving any benefit from them, the local pledged to give, $37,500 or less during its first tax year;

chapter does not include the premiums in its gross receipts. 2. Between 1 and 3 years old and averaged $30,000 or less

The parent lodge reports them instead. The same treatment in gross receipts during each of its first 2 tax years; or

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3. Three years old or more and averaged $25,000 or less in If the company did not meet this test and the company is a

gross receipts for the immediately preceding 3 tax years mutual insurance company, then it must meet the Alternate test

(including the year for which the return would be filed). to qualify to file Form 990 (or Form 990-EZ, if applicable).

Insurance companies that do not qualify as tax-exempt must file If the organization’s gross receipts are normally $25,000 or Form 1120-PC, U.S. Property and Casualty Insurance less, it must file Form 990-N, Electronic Notice (e-Postcard) for Company Income Tax Return, or Form 1120, U.S. Corporation Tax-Exempt Organizations not Required To File Form 990 or Income Tax Return, as taxable entities for the year. See Notice 990-EZ (with exceptions for certain organizations described in 2006-42, which is on page 878 of the Internal Revenue Bulletin General Instruction B). 2006-19 available at www.irs.gov.

$5,000 Gross Receipts Test Alternate test. If any section 501(c)(15) insurance

company (other than life insurance) is a mutual insurance To determine whether an organization’s gross receipts are company and it did not meet the above test, then the company normally $5,000 or less, apply the following test. An must meet both parts of the following alternate test. organization’s gross receipts are considered normally to be

$5,000 or less if the organization is: 1. The company’s gross receipts must be equal to or less

than $150,000, and 1. Up to a year old and has received, or donors have 2. The company’s premiums must be more than 35% of its pledged to give, $7,500 or less during its first tax year; gross receipts. 2. Between 1 and 3 years old and averaged $6,000 or less

in gross receipts during each of its first 2 tax years; or If the company does not meet either test, then it must file 3. Three years old or more and averaged $5,000 or less in Form 1120-PC or Form 1120 (if the company is not entitled to gross receipts for the immediately preceding 3 tax years insurance reserves) instead of Form 990 or Form 990-EZ. (including the year for which the return would be filed).

The alternate test does not apply if any employee of the

mutual insurance company or a member of the Appendix C: Special Gross Receipts CAUTION employee’s family is an employee of another company

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Test for Determining Exempt Status of that is exempt under section 501(c)(15) (or would be exempt if

this provision did not apply). Section 501(c)(7) and 501(c)(15) Gross receipts. To determine whether a section 501(c)(15)

Organizations organization satisfies either of the above tests described in

Section 501(c)(7) organizations (social clubs) and 501(c)(15) Appendix C, figure gross receipts by adding:

organizations (insurance companies) apply the same gross 1. Premiums (including deposits and assessments) without

receipts test as other organizations to determine whether they reduction for return premiums or premiums paid for

must file the Form 990 or Form 990-EZ. However, section reinsurance;

501(c)(7) and 501(c)(15) organizations are also subject to 2. Gross investment income of a non-life insurance

separate gross receipts tests to determine whether they qualify company (as described in section 834(b)); and

as tax-exempt for the tax year. The following tests use a special 3. Other items that are included in the filer’s gross income

definition of gross receipts for purposes of determining whether under Subchapter B, Chapter 1, Subtitle A of the Code.

these organizations are exempt for a particular tax year. This definition does not, however, include contributions to Section 501(c)(7) capital. For more information, see Notice 2006-42.

A section 501(c)(7) organization may receive up to 35% of its Premiums. Premiums consist of all amounts received as a

gross receipts, including investment income, from sources result of entering into an insurance contract. They are reported outside its membership and remain tax-exempt. Part of the 35% on Form 990, Part VIII (Statement of Revenue), line 2, or on (up to 15% of gross receipts) may be from public use of a social Form 990-EZ, Part I, line 2. club’s facilities. Anti-abuse rule. The anti-abuse rule, found in section

“Gross receipts” for purposes of determining 501(c)(7) 501(c)(15)(C), explains how gross receipts (including exemption are the club’s income from its usual activities and premiums) from all members of a controlled group are include: aggregated in figuring the above tests. • Charges,

• Admissions, Appendix D: Public Inspection of • Membership fees,

• Dues, Returns • Assessments, and Some members of the public rely on Form 990, or Form • Investment income (such as dividends, rents, and similar 990-EZ, as the primary or sole source of information about a receipts), and normal recurring capital gains on investments. particular organization. How the public perceives an

Gross receipts for this purpose do not include: organization in such cases may be determined by the

• Capital contributions (see Regulations section 1.118-1), information presented on its returns.

• Initiation fees, or An organization’s completed Form 990, or Form 990-EZ, is • Unusual amounts of income (such as the sale of the available for public inspection as required by section 6104.

clubhouse). Schedule B, Schedule of Contributors (Form 990, 990-EZ, or

990-PF) is open for public inspection for section 527 College fraternities or sororities or other organizations organizations filing Form 990 or Form 990-EZ. For other that charge membership initiation fees, but not annual organizations that file Form 990 or Form 990-EZ, parts of CAUTION dues, must include initiation fees in their gross receipts.

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Schedule B may be open to public inspection. Form 990-T filed

after August 17, 2006, by a 501(c)(3) organization to report any Section 501(c)(15) unrelated business income, is also available for public If any section 501(c)(15) insurance company (other than life inspection and disclosure. insurance) normally has gross receipts of more than $25,000

for the tax year and meets both parts of the following test, then Through the IRS

the company may file Form 990 (or Form 990-EZ, if applicable). Use Form 4506-A to request:

1. The company’s gross receipts must be equal to or less • A copy of an exempt or political organization’s return, report,

than $600,000, and notice, or exemption application;

2. The company’s premiums must be more than 50% of its • An inspection of a return, report, notice, or exemption

gross receipts. application at an IRS office.

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The IRS can provide copies of exempt organization returns Definitions

on a compact disc (CD). Requesters can order the complete set Tax-exempt organization is any organization that is described (all Forms 990 and 990-EZ or all Forms 990-PF filed for a year) in section 501(c) or (d) and is exempt from taxation under or a partial set by state or by month. For more information on section 501(a). The term tax-exempt organization also includes the cost and how to order CD-ROMs, call the TE/GE Customer any section 4947(a)(1) nonexempt charitable trust or Account Services toll-free number (1-877-829-5500) or write to nonexempt private foundation that is subject to the reporting the IRS: requirements of section 6033.

Internal Revenue Service Application for tax exemption includes: Mail Stop 6716 • Any prescribed application form (such as Form 1023 or Form Ogden, UT 84201 1024),

The IRS generally may not disclose portions of an exemption • All documents and statements the IRS requires an applicant

application relating to any trade secrets, etc. Additionally, the to file with the form,

IRS may not disclose the names and addresses of contributors. • Any statement or other supporting document submitted in

See the Instructions for Schedule B (Form 990, 990-EZ, or support of the application, and

990-PF) for more information about the disclosure of that • Any letter or other document issued by the IRS concerning

schedule. the application.

Notice 2008-49, 2008-20 I.R.B. 979, provides interim Application for tax exemption does not include:

guidance regarding the requirement that section 501(c)(3) • Any application for tax exemption filed before July 15, 1987,

organizations and the IRS make available for public inspection unless the organization filing the application had a copy of the

Form 990-T. application on July 15, 1987;

• In the case of a tax-exempt organization other than a private Forms 990 or 990-EZ can only be requested for section 527 foundation, the name and address of any contributor to the organizations for tax years beginning after June 30, 2000. organization; or

• Any material that is not available for public inspection under A return, report, notice, or exemption application may be section 6104. inspected at an IRS office free of charge. Copies of these items

may also be obtained through the organization as discussed in If there is no prescribed application form, see the following section. Regulations section 301.6104(d)-1(b)(3)(ii). CAUTION

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Through the Organization

Public inspection and distribution of certain returns of Annual information return includes:

unrelated business income. Section 501(c)(3) organizations • An exact copy of the Form 990 or Form 990-EZ filed by a

tax-exempt organization as required by section 6033, that are required to file Form 990-T after August 17, 2006, must

make Form 990-T available for public inspection under section • Any amended return the organization files with the IRS after

6104(d)(1)(A)(ii). the date the original return is filed, and

• An exact copy of Form 990-T if one is filed by a 501(c)(3) Public inspection and distribution of returns and reports organization. for a political organization. Section 527 political

organizations required to file Form 990, or Form 990-EZ, must, The copy must include all information furnished to the IRS

on Form 990, Form 990-EZ, or Form 990-T as well as all in general, make their Form 8871, 8872, 990, or 990-EZ

available for public inspection in the same manner as annual schedules, attachments and supporting documents, except for

the name and address of any contributor to the organization. information returns of section 501(c) organizations and

4947(a)(1) nonexempt charitable trusts. See the public See the Instructions for Schedule B (Form 990, 990-EZ, or

inspection rules for Tax-exempt organizations, later. Generally, 990-PF). However, schedules, attachments, and supporting

Form 8871 and Form 8872 are available for inspection and documents filed with Form 990-T that do not relate to the

printing in the Charities & Nonprofits section of the IRS Web imposition of unrelated business income tax are not required to

site (www.irs.gov). be made available for public inspection and copying. See

Notice 2008-49, 2008-20 I.R.B. 979.

Note that a section 527 political organization (and an Annual returns more than 3 years old. An annual organization filing Form 990-PF) must disclose their information return does not include any return after the Schedule B (Form 990, 990-EZ, or 990-PF). See the

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expiration of 3 years from the date the return is required to be Instructions for Schedule B. The penalties discussed in General filed (including any extension of time that has been granted for Instruction H also apply to section 527 political organizations filing such return) or is actually filed, whichever is later. (Rev. Rul. 2003-49, 2003-20 I.R.B. 903).

If an organization files an amended return, however, the Public inspection and distribution of applications for tax amended return must be made available for a period of 3 years exemption and annual information returns of tax-exempt beginning on the date it is filed with the IRS. organizations. Under Regulations sections 301.6104(d)-1

through -3, a tax-exempt organization must: Local or subordinate organizations. For rules relating to

• Make its application for recognition of exemption and its annual information returns of local or subordinate organizations,

annual information returns available for public inspection see Regulations section 301.6104(d)-1(f)(2).

without charge at its principal, regional and district offices Regional or district offices. A regional or district office is during regular business hours. any office of a tax-exempt organization, other than its principal • Make each annual information return available for a period of office, that has paid employees, whether part-time or full-time, 3 years beginning on the date the return is required to be filed whose aggregate number of paid hours a week are normally at (determined with regard to any extension of time for filing) or is least 120. actually filed, whichever is later.

• Provide a copy without charge (for Form 990-T, this A site is not considered a regional or district office, however,

requirement applies only to Forms 990-T filed after August 17, if:

2006), other than a reasonable fee for reproduction and actual • The only services provided at the site further exempt

postage costs, of all or any part of any application or return purposes (such as day care, health care or scientific or medical

required to be made available for public inspection to any research); and

individual who makes a request for such copy in person or in • The site does not serve as an office for management staff,

writing (except as provided in Regulations sections other than managers who are involved solely in managing the

301.6104(d)-2 and -3). exempt function activities at the site.

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Special rules relating to public inspection Time and manner of fulfilling written requests

Permissible conditions on public inspection. A IF the organization THEN the organization tax-exempt organization:

• May have an employee present in the room during an Receives a written request Must mail the copy of the requested

for a copy, documents (or the requested parts) inspection, within 30 days from the date it receives • Must allow the individual conducting the inspection to take the request. notes freely during the inspection, and

• Must allow the individual to photocopy the document at no Mails the copy of the Is deemed to have provided the copy on

charge, if the individual provides photocopying equipment at the requested document, the postmark date or private delivery

place of inspection. mark (if sent by certified or registered

mail, the date of registration or the date

Organizations that do not maintain permanent offices. of the postmark on the sender’s receipt).

A tax-exempt organization with no permanent office: Requires payment in Is required to provide the copies within • Must make its application for tax exemption and its annual advance, 30 days from the date it receives information returns available for inspection at a reasonable payment. location of its choice,

Receives a request or Is deemed to have received it 7 days • Must permit public inspection within a reasonable amount of payment by mail, after the date of the postmark, absent time after receiving a request for inspection (normally not more evidence to the contrary. than 2 weeks) and at a reasonable time of day,

• May mail, within 2 weeks of receiving the request, a copy of Receives a request Is deemed to have received it the day

its application for tax exemption and annual information returns transmitted by electronic the request is transmitted successfully.

to the requester instead of allowing an inspection, and mail or facsimile,

• May charge the requester for copying and actual postage Receives a written request Must notify the requester of the costs only if the requester consents to the charge. without payment or with an prepayment policy and the amount due

insufficient payment, when within 7 days from the date of the An organization that has a permanent office, but has no payment in advance is request’s receipt. office hours, or very limited hours during certain times of the required, year, must make its documents available during those periods

when office hours are limited, or not available, as though it were Receives consent from an May provide a copy of the requested

an organization without a permanent office. individual making a document exclusively by electronic mail

request, (the material is provided on the date the

organization successfully transmits the Special rules relating to copies electronic mail). Time and place for providing copies in response to

requests made in-person. A tax-exempt organization must: Request for a copy of parts of a document. A tax-exempt • Provide copies of required documents under section 6104(d) organization must fulfill a request for a copy of the in response to a request made in person at its principal, organization’s entire application for tax exemption or annual regional and district offices during regular business hours, and information return or any specific part or schedule of its • Provide such copies to a requester on the day the request is application or return. A request for a copy of less than the entire made, except for unusual circumstances (see below). application or less than the entire return must specifically

Unusual circumstances. identify the requested part or schedule. In the case of an in-person

request, where unusual circumstances exist so that fulfilling the Fees for copies. A tax-exempt organization may charge a request on the same business day causes an unreasonable reasonable fee for providing copies. Before the organization burden to the tax-exempt organization, the organization must provides the documents, it may require that the individual provide the copies no later than the next business day following requesting copies of the documents pay the fee. If the the day that the unusual circumstances cease to exist, or the organization has provided an individual making a request with 5th business day after the date of the request, whichever notice of the fee, and the individual does not pay the fee within occurs first. 30 days, or if the individual pays the fee by check and the check

does not clear upon deposit, the organization may disregard the Unusual circumstances include: request. • Requests received that exceed the organization’s daily

capacity to make copies; Form of payment—(A) Request made in person. If a

tax-exempt organization charges a fee for copying, it must • Requests received shortly before the end of regular business accept payment by cash and money order for requests made in hours that require an extensive amount of copying; or person. The organization may accept other forms of payment, • Requests received on a day when the organization’s such as credit cards and personal checks. managerial staff capable of fulfilling the request is conducting

special duties, such as student registration or attending an (B) Request made in writing. If a tax-exempt organization

off-site meeting or convention, rather than its regular charges a fee for copying and postage, it must accept payment

administrative duties. by certified check, money order, and either personal check or

credit card for requests made in writing. The organization may Agents for providing copies. For rules relating to use of accept other forms of payment. agents to provide copies, see Regulations sections Avoidance of unexpected fees. Where a tax-exempt 301.6104(d)-1(d)(1) and (2). organization does not require prepayment and a requester does

Request for copies in writing. A tax-exempt organization not enclose payment with a request, an organization must

must honor a written request for a copy of documents (or the receive consent from a requester before providing copies for

requested part) required under section 6104(d) if the request: which the fee charged for copying and postage exceeds $20.

1. Is addressed to, and delivered by mail, electronic mail, Documents to be provided by regional and district facsimile, or a private delivery service, as defined in section offices. Except as otherwise provided, a regional or district 7502(f), to a principal, regional, or district office of the office of a tax-exempt organization must satisfy the same rules organization; and as the principal office with respect to allowing public inspection

2. Sets forth the address to which the copy of the and providing copies of its application for tax exemption and

documents should be sent. annual information returns.

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A regional or district office is not required, however, to make annual information return if the organization has made the

its annual information return available for inspection or to requested document widely available (see below).

provide copies until 30 days after the date the return is required An organization that makes its application for tax exemption to be filed (including any extension of time that is granted for and/or annual information return widely available must filing such return) or is actually filed, whichever is later. nevertheless make the document available for public inspection

Documents to be provided by local and as required under Regulations section 301.6104(d)-1(a).

subordinate organizations A tax-exempt organization makes its application for tax

Applications for tax exemption. Except as otherwise exemption and/or an annual information return widely available

provided, a tax-exempt organization that did not file its own if the organization complies with the Internet posting

application for tax exemption (because it is a local or requirements and the notice requirements given below.

subordinate organization covered by a group exemption letter) Internet posting. A tax-exempt organization can make its must, upon request, make available for public inspection, or application for tax exemption and/or an annual information provide copies of, the application submitted to the IRS by the return widely available by posting the document on a World central or parent organization to obtain the group exemption Wide Web page that the tax-exempt organization establishes letter and those documents which were submitted by the central and maintains or by having the document posted, as part of a or parent organization to include the local or subordinate database of similar documents of other tax-exempt organization in the group exemption letter. organizations, on a World Wide Web page established and

However, if the central or parent organization submits to the maintained by another entity. The document will be considered

widely available only if: IRS a list or directory of local or subordinate organizations

covered by the group exemption letter, the local or subordinate • The World Wide Web page through which it is available

organization is required to provide only the application for the clearly informs readers that the document is available and

group exemption ruling and the pages of the list or directory that provides instructions for downloading it;

specifically refer to it. The local or subordinate organization • The document is posted in a format that, when accessed,

must permit public inspection, or comply with a request for downloaded, viewed and printed in hard copy, exactly

copies made in person, within a reasonable amount of time reproduces the image of the application for tax exemption or

annual information return as it was originally filed with the IRS, (normally not more than 2 weeks) after receiving a request

made in person for public inspection or copies and at a except for any information permitted by statute to be withheld

reasonable time of day. See Regulations section from public disclosure; and

301.6104(d)-1(f) for further information. • Any individual with access to the Internet can access,

download, view and print the document without special Annual information returns. A local or subordinate computer hardware or software required for that format (other organization that does not file its own annual information return than software that is readily available to members of the public (because it is affiliated with a central or parent organization that without payment of any fee) and without payment of a fee to the files a group return) must, upon request, make available for tax-exempt organization or to another entity maintaining the public inspection, or provide copies of, the group returns filed by World Wide Web page. the central or parent organization.

Reliability and accuracy. In order for the document to be However, if the group return includes separate schedules widely available through an Internet posting, the entity with respect to each local or subordinate organization included maintaining the World Wide Web page must have procedures in the group return, the local or subordinate organization for ensuring the reliability and accuracy of the document that it receiving the request may omit any schedules relating only to posts on the page and must take reasonable precautions to other organizations included in the group return. prevent alteration, destruction or accidental loss of the The local or subordinate organization must permit public document when posted on its page. In the event that a posted inspection, or comply with a request for copies made in person, document is altered, destroyed or lost, the entity must correct or within a reasonable amount of time (normally not more than 2 replace the document. weeks) after receiving a request made in person for public Notice requirement. If a tax-exempt organization has inspection or copies and at a reasonable time of day. made its application for tax exemption and/or an annual In a case where the requester seeks inspection, the local or information return widely available, it must notify any individual subordinate organization may mail a copy of the applicable requesting a copy where the documents are available (including documents to the requester within the same time period instead the address on the World Wide Web, if applicable). If the of allowing an inspection. In such a case, the organization may request is made in person, the organization must provide such charge the requester for copying and actual postage costs only notice to the individual immediately. If the request is made in if the requester consents to the charge. writing, the notice must be provided within 7 days of receiving

If the local or subordinate organization receives a written the request.

request for a copy of its annual information return, it must fulfill Tax-exempt organization subject to harassment the request by providing a copy of the group return in the time

and manner specified in the paragraph earlier, Request for campaign

copies in writing. If the Director EO Examination (or designee) determines that

The requester has the option of requesting from the central the organization is being harassed, a tax-exempt organization is

or parent organization, at its principal office, inspection or not required to comply with any request for copies that it

copies of group returns filed by the central or parent reasonably believes is part of a harassment campaign.

organization. The central or parent organization must fulfill such Whether a group of requests constitutes a harassment requests in the time and manner specified in the paragraphs, campaign depends on the relevant facts and circumstances Special rules relating to public inspection and Special rules such as:

relating to copies earlier. • A sudden increase in requests;

Failure to comply. If an organization fails to comply with • An extraordinary number of requests by form letters or

the requirements specified in this paragraph, the penalty similarly worded correspondence;

provisions of sections 6652(c)(1)(C), 6652(c)(1)(D), and 6685 • Hostile requests;

apply. • Evidence showing bad faith or deterrence of the

organization’s exempt purpose; Making applications and returns widely • Prior provision of the requested documents to the purported available harassing group; and

A tax-exempt organization is not required to comply with a • A demonstration that the organization routinely provides

request for a copy of its application for tax exemption or an copies of its documents upon request.

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A tax-exempt organization may disregard any request for time during a 5-year period ending on the date of the

copies of all or part of any document beyond the first two transaction. Persons who hold certain powers, responsibilities,

received within any 30-day period or the first four received or interests are among those who are in a position to exercise

within any 1-year period from the same individual or the same substantial influence over the affairs of the organization. This

address, regardless of whether the Director EO Examination (or would include, for example, voting members of the governing

designee) has determined that the organization is subject to a body, and persons holding the power of:

harassment campaign. • Presidents, chief executive officers, or chief operating

A tax-exempt organization may apply for a determination officers, and

• Treasurers and chief financial officers. that it is the subject of a harassment campaign and that

compliance with requests that are part of the campaign would A disqualified person also includes certain family members

not be in the public interest by submitting a signed application of a disqualified person, and 35% controlled entities of a

to the Director EO Examination (or designee) for the area disqualified person.

where the organization’s principal office is located. The following persons are considered disqualified persons

In addition, the organization may suspend compliance with with respect to the following organizations, along with certain

any request it reasonably believes to be part of the harassment family members and 35% controlled entities associated with

campaign until it receives a response to its application for a them:

harassment campaign determination. However, if the Director • With respect to a transaction involving a donor advised fund,

EO Examination (or designee) determines that the organization a donor or donor advisor of that donor advised fund,

did not have a reasonable basis for requesting a determination • With respect to a sponsoring organization of a donor advised

that it was subject to a harassment campaign or reasonable fund, an investment advisor of the sponsoring organization, and

belief that a request was part of the campaign, the officer, • With respect to a supported organization of a section

director, trustee, employee, or other responsible individual of 509(a)(3) supporting organization, the disqualified persons of

the organization remains liable for any penalties for not the section 509(a)(3) supporting organization.

providing the copies in a timely fashion. See Regulations Substantial contributors to supporting organizations are also section 301.6104(d)-3. considered disqualified persons along with their family

members and 35% controlled entities. Appendix E: Section 4958 Excess See the instructions for Form 4720, Schedule I for more

Benefit Transactions information regarding these disqualified persons.

The intermediate sanction regulations are important to the Who is not a disqualified person? The rules also clarify

exempt organization community as a whole, and for ensuring which persons are not considered to be in a position to exercise

compliance in this area. The rules provide a roadmap by which substantial influence over the affairs of an organization. They

an organization may steer clear of situations that may give rise include:

to inurement. • An employee who receives benefits that total less than the

Under section 4958, any disqualified person who benefits highly compensated amount ($100,000 in 2007) and who does

not hold the executive or voting powers just mentioned; is not a from an excess benefit transaction with an applicable family member of a disqualified person; and is not a substantial tax-exempt organization is liable for a 25% tax on the excess contributor; benefit. The disqualified person is also liable for a 200% tax on • Tax-exempt organizations described in section 501(c)(3); and the excess benefit if the excess benefit is not corrected by a • Section 501(c)(4) organizations with respect to transactions certain date. Also, organization managers who participate in an engaged in with other section 501(c)(4) organizations. excess benefit transaction knowingly, willfully, and without

reasonable cause are liable for a 10% tax on the excess Who else may be considered a disqualified person? Other

benefit, not to exceed $20,000 for all participating managers on persons not described above can also be considered

each transaction. disqualified persons, depending on all the relevant facts and

circumstances. Applicable Tax-Exempt Organization Facts and circumstances tending to show substantial These rules only apply to certain applicable section 501(c)(3) influence: and 501(c)(4) organizations. An applicable tax-exempt • The person founded the organization. organization is a section 501(c)(3) or a section 501(c)(4) • The person is a substantial contributor to the organization organization that is tax exempt under section 501(a), or was under the section 507(d)(2)(A) definition, only taking into such an organization at any time during a 5-year period ending account contributions to the organization for the past 5 years. on the day of the excess benefit transaction. • The person’s compensation is primarily based on revenues

An applicable tax-exempt organization does not include: derived from activities of the organization that the person • A private foundation as defined in section 509(a). controls. • A governmental entity that is exempt from (or not subject to) • The person has or shares authority to control or determine a taxation without regard to section 501(a) or relieved from filing substantial portion of the organization’s capital expenditures, an annual return under Regulations section 1.6033-2(g)(6). operating budget, or compensation for employees. • Certain foreign organizations. • The person manages a discrete segment or activity of the

An organization is not treated as a section 501(c)(3) or organization that represents a substantial portion of the

501(c)(4) organization for any period covered by a final activities, assets, income, or expenses of the organization, as

determination that the organization was not tax-exempt under compared to the organization as a whole.

section 501(a), so long as the determination was not based on • The person owns a controlling interest (measured by either

private inurement or one or more excess benefit transactions. vote or value) in a corporation, partnership, or trust that is a

disqualified person. Disqualified Person • The person is a nonstock organization controlled directly or

The vast majority of section 501(c)(3) or 501(c)(4) organization indirectly by one or more disqualified persons.

employees and contractors will not be affected by these rules. Facts and circumstances tending to show no substantial Only the few influential persons within these organizations are influence:

covered by these rules when they receive benefits, such as • The person is an independent contractor whose sole compensation, fringe benefits, or contract payments. The IRS relationship to the organization is providing professional advice calls this class of covered individuals disqualified persons. (without having decision-making authority) with respect to

A disqualified person, regarding any transaction, is any transactions from which the independent contractor will not

person who was in a position to exercise substantial influence economically benefit.

over the affairs of the applicable tax-exempt organization at any • The person has taken a vow of poverty.

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• Any preferential treatment the person receives based on the The excess benefit for substantial contributors and parties

size of the person’s donation is also offered to others making related to those contributors includes the amount of the grant,

comparable widely solicited donations. loan, compensation, or similar payment. For additional

• The direct supervisor of the person is not a disqualified information see the Instructions for Form 4720.

person. When does an excess benefit transaction usually occur? • The person does not participate in any management An excess benefit transaction occurs on the date the decisions affecting the organization as a whole or a discrete disqualified person receives the economic benefit from the segment of the organization that represents a substantial organization for federal income tax purposes. However, when a portion of the activities, assets, income, or expenses of the single contractual arrangement provides for a series of organization, as compared to the organization as a whole. compensation payments or other payments to a disqualified

What about persons who staff affiliated organizations? In person during the disqualified person’s tax year, any excess

the case of multiple affiliated organizations, the determination of benefit transaction with respect to these payments occurs on

whether a person has substantial influence is made separately the last day of the taxpayer’s tax year.

for each applicable tax-exempt organization. A person may be a In the case of the transfer of property subject to a substantial disqualified person with respect to more than one organization risk of forfeiture, or in the case of rights to future compensation in the same transaction. or property, the transaction occurs on the date the property, or

the rights to future compensation or property, is not subject to a Excess Benefit Transaction substantial risk of forfeiture. Where the disqualified person An excess benefit transaction generally is a transaction in which elects to include an amount in gross income in the tax year of an economic benefit is provided by an applicable tax-exempt transfer under section 83(b), the excess benefit transaction organization, directly or indirectly, to or for the use of any occurs on the date the disqualified person receives the disqualified person, and the value of the economic benefit economic benefit for federal income tax purposes. provided by the applicable tax-exempt organization exceeds the Section 4958 applies only to post-September 1995 value of the consideration (including the performance of transactions. Section 4958 applies the general rules to services) received for providing such benefit, but see the excess benefit transactions occurring on or after September 14, special rules below. An excess benefit transaction also can 1995. Section 4958 does not apply to any transaction occurring occur when a disqualified person embezzles from the exempt pursuant to a written contract that was binding on September organization. 13, 1995, and at all times thereafter before the transaction To determine whether an excess benefit transaction has occurs. The special rules relevant to transactions with donor occurred, all consideration and benefits exchanged between a advised funds and supporting organizations apply to disqualified person and the applicable tax-exempt organization, transactions occurring after August 17, 2006. and all entities it controls, are taken into account. What is reasonable compensation? For purposes of determining the value of economic benefits, Reasonable compensation is the valuation standard that is the value of property, including the right to use property, is the used to determine if there is an excess benefit in the exchange fair market value. Fair market value is the price at which of a disqualified person’s services for compensation. property, or the right to use property, would change hands

between a willing buyer and a willing seller, neither being under Reasonable compensation is the value that would ordinarily

any compulsion to buy, sell or transfer property or the right to be paid for like services by like enterprises under like

use property, and both having reasonable knowledge of circumstances. This is the section 162 standard that will apply

relevant facts. in determining the reasonableness of compensation. The fact

that a bonus or revenue-sharing arrangement is subject to a Donor advised funds. For a donor advised fund, an excess cap is a relevant factor in determining the reasonableness of benefit transaction includes a grant, loan, compensation, or compensation. similar payment from the fund to a:

• Donor or donor advisor, For determining the reasonableness of compensation, all

• Family member of a donor, or donor advisor, items of compensation provided by an applicable tax-exempt

• 35% controlled entity of a donor or donor advisor, or organization in exchange for the performance of services are

• 35% controlled entity of a family member of a donor or donor taken into account in determining the value of compensation

advisor. (except for certain economic benefits that are disregarded, as

discussed in What benefits are disregarded? later). Items of The excess benefit in this transaction is the amount of the compensation include: grant, loan, compensation, or similar payment. For additional • All forms of cash and noncash compensation, including information see the Instructions for Form 4720. salary, fees, bonuses, severance payments, and deferred and Supporting organizations. For any supporting organization, noncash compensation. defined in section 509(a)(3), an excess benefit transaction • The payment of liability insurance premiums for, or the includes grants, loans, compensation, or similar payment payment or reimbursement by the organization of taxes or provided by the supporting organization to a: certain expenses under section 4958, unless excludable from • Substantial contributor, income as a de minimis fringe benefit under section 132(a)(4). • Family member of a substantial contributor, (A similar rule applies in the private foundation area.) Inclusion • 35% controlled entity of a substantial contributor, and in compensation for purposes of determining reasonableness • 35% controlled entity of a family member of a substantial under section 4958 does not control inclusion in income for

contributor. income tax purposes.

Additionally, an excess benefit transaction includes any • All other compensatory benefits, whether or not included in

gross income for income tax purposes. loans provided by the supporting organization to a disqualified

person (other than an organization described in section • Taxable and nontaxable fringe benefits, except fringe

509(a)(1), (2), or (4)). benefits described in section 132.

• Foregone interest on loans. A substantial contributor is any person who contributed or Written intent required to treat benefits as bequeathed an aggregate of more than $5,000 to the compensation. An economic benefit is not treated as organization. If that amount is more than 2% of the total consideration for the performance of services unless the contributions and bequests received by the organization before organization providing the benefit clearly indicates its intent to the end of the tax year of the organization in which the treat the benefit as compensation when the benefit is paid. contribution or bequest is received by the organization from

such person. A substantial contributor includes the grantor of a An applicable tax-exempt organization (or entity that it

trust. controls) is treated as clearly indicating its intent to provide an

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economic benefit as compensation for services only if the Treatment as a new contract may cause the contract to fall

organization provides written substantiation that is outside the initial contract exception, and it thus would be tested

contemporaneous with the transfer of the economic benefits under the fair market value standards of section 4958.

under consideration. Ways to provide contemporaneous written

substantiation of its intent to provide an economic benefit as Rebuttable Presumption of Reasonableness

compensation include: Payments under a compensation arrangement are presumed to

• The organization produces a signed written employment be reasonable and the transfer of property (or right to use

contract; property) is presumed to be at fair market value, if the following

• The organization reports the benefit as compensation on an three conditions are met.

original Form W-2, Form 1099, Form 990, or 990-EZ, or on an 1. The transaction is approved by an authorized body of the amended form filed prior to the start of an IRS examination; or organization (or an entity it controls) which is composed of • The disqualified person reports the benefit as income on the individuals who do not have a conflict of interest concerning the person’s original Form 1040 or on an amended form filed prior transaction.

to the start of an IRS examination. 2. Prior to making its determination, the authorized body

Exception. To the extent the economic benefit is excluded obtained and relied upon appropriate data as to comparability.

from the disqualified person’s gross income for income tax There is a special safe harbor for small organizations. If the

purposes, the applicable tax-exempt organization is not organization has gross receipts of less than $1 million,

required to indicate its intent to provide an economic benefit as appropriate comparability data includes data on compensation

compensation for services. (For example, employer provided paid by three comparable organizations in the same or similar

health benefits, and contributions to qualified plans under communities for similar services.

section 401(a).) 3. The authorized body adequately documents the basis for

What benefits are disregarded? its determination concurrently with making that determination. The following economic The documentation should include: benefits are disregarded for purposes of section 4958:

• Nontaxable fringe benefits, for example, an economic benefit a. The terms of the approved transaction and the date

that is excluded from income under section 132. approved;

• Benefits to volunteer, for example, an economic benefit b. The members of the authorized body who were present

provided to a volunteer for the organization if the benefit is during debate on the transaction that was approved and those

provided to the general public in exchange for a membership who voted on it;

fee or contribution of $75 or less per year. c. The comparability data obtained and relied upon by the

• Benefits to members or donors, for example, an economic authorized body and how the data was obtained;

benefit provided to a member of an organization due to the d. Any actions by a member of the authorized body having a

payment of a membership fee, or to a donor as a result of a conflict of interest; and

deductible contribution, if a significant number of e. Documentation of the basis for the determination before

nondisqualified persons make similar payments or contributions the later of the next meeting of the authorized body or 60 days

and are offered a similar economic benefit. after the final actions of the authorized body are taken, and

• Benefits to a charitable beneficiary, for example, an approval of records as reasonable, accurate and complete

economic benefit provided to a person solely as a member of a within a reasonable time thereafter.

charitable class that the applicable tax-exempt organization

intends to benefit as part of the accomplishment of its exempt Special rebuttable presumption rule for nonfixed

purpose. payments. As a general rule, in the case of a nonfixed

• Benefits to a governmental unit, for example, a transfer of an payment, no rebuttable presumption arises until the exact

economic benefit to or for the use of a governmental unit, as amount of the payment is determined, or a fixed formula for

defined in section 170(c)(1), if exclusively for public purposes. calculating the payment is specified, and the three requirements

creating the presumption have been satisfied. However, if the Is there an exception for initial contracts? Section 4958 authorized body approves an employment contract with a does not apply to any fixed payment made to a person pursuant disqualified person that includes a nonfixed payment (for to an initial contract. This is a very important exception, since it example, discretionary bonus) with a specified cap on the would potentially apply, for example, to all initial contracts with amount, the authorized body may establish a rebuttable new, previously unrelated officers and contractors. presumption as to the nonfixed payment when the employment An initial contract is a binding written contract between an contract is entered into by, in effect, assuming that the applicable tax-exempt organization and a person who was not a maximum amount payable under the contract will be paid, and disqualified person immediately prior to entering into the satisfying the requirements giving rise to the rebuttable

contract. presumption for that maximum amount.

A fixed payment is an amount of cash or other property An IRS challenge to the presumption of reasonableness. specified in the contract, or determined by a fixed formula that The Internal Revenue Service may refute the presumption of is specified in the contract, which is to be paid or transferred in reasonableness only if it develops sufficient contrary evidence exchange for the provision of specified services or property. to rebut the probative value of the comparability data relied

A fixed formula may, in general, incorporate an amount that upon by the authorized body. This provision gives taxpayers

depends upon future specified events or contingencies, as long added protection if they faithfully find and use

as no one has discretion when calculating the amount of a contemporaneous persuasive comparability data when they

payment or deciding whether to make a payment (such as a provide the benefits.

bonus). Organizations that do not establish a presumption of

Treatment as new contract. A binding written contract reasonableness. An organization may still comply with

providing that it may be terminated or cancelled by the section 4958 even if it did not establish a presumption of

applicable tax-exempt organization without the other party’s reasonableness. In some cases, an organization may find it

consent (except as a result of substantial non-performance) and impossible or impracticable to fully implement each step of the

without substantial penalty, is treated as a new contract, as of rebuttable presumption process described above. In such

the earliest date that any termination or cancellation would be cases, the organization should try to implement as many steps

effective. Also, a contract in which there is a material change, as possible, in whole or in part, in order to substantiate the

which includes an extension or renewal of the contract (except reasonableness of benefits as timely and as well as possible. If

for an extension or renewal resulting from the exercise of an an organization does not satisfy the requirements of the

option by the disqualified person), or a more than incidental rebuttable presumption of reasonableness, a facts and

change to the amount payable under the contract, is treated as circumstances approach will be followed, using established

a new contract as of the effective date of the material change. rules for determining reasonableness of compensation and

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benefit deductions in a manner similar to the established A disqualified person corrects an excess benefit by making a

procedures for section 162 business expenses. payment in cash or cash equivalents equal to the correction

amount to the applicable tax-exempt organization. The Section 4958 Taxes correction amount equals the excess benefit plus the interest on

Tax on disqualified persons. An excise tax equal to 25% of the excess benefit; the interest rate may be no lower than the

the excess benefit is imposed on each excess benefit applicable Federal rate. There is an anti-abuse rule to prevent

transaction between an applicable tax-exempt organization and the disqualified person from effectively transferring property

a disqualified person. The disqualified person who benefited other than cash or cash equivalents.

from the transaction is liable for the tax. If the 25% tax is Exception. For a correction of an excess benefit

imposed and the excess benefit transaction is not corrected transaction described in Donor advised funds (discussed within the taxable period, an additional excise tax equal to earlier), no amount repaid in a manner prescribed by the 200% of the excess benefit is imposed. Secretary may be held in a donor advised fund.

If a disqualified person makes a payment of less than the full Property. With the agreement of the applicable tax-exempt correction amount, the 200% tax is imposed only on the unpaid organization, a disqualified person may make a payment by portion of the correction amount. If more than one disqualified returning the specific property previously transferred in the person received an excess benefit from an excess benefit excess benefit transaction. The return of the property is transaction, all such disqualified persons are jointly and considered a payment of cash (or cash equivalent) equal to the severally liable for the taxes. lesser of:

To avoid the imposition of the 200% tax, a disqualified • The fair market value of the property on the date the property

person must correct the excess benefit transaction during the is returned to the organization, or

taxable period. The taxable period begins on the date the • The fair market value of the property on the date the excess

transaction occurs and ends on the earlier of the date the benefit transaction occurred.

statutory notice of deficiency is issued or the section 4958 taxes Insufficient payment. If the payment resulting from the are assessed. This 200% tax may be abated if the excess return of the property is less than the correction amount, the benefit transaction subsequently is corrected during a 90-day disqualified person must make an additional cash payment to correction period. the organization equal to the difference. Tax on organization managers. An excise tax equal to 10% Excess payment. If the payment resulting from the return of the excess benefit may be imposed on the participation of an of the property exceeds the correction amount described above, organization manager in an excess benefit transaction between the organization may make a cash payment to the disqualified an applicable tax exempt organization and a disqualified person equal to the difference. person. This tax, which may not exceed $20,000 with respect to

any single transaction, is only imposed if the 25% tax is Churches and Section 4958

imposed on the disqualified person, the organization manager The regulations make it clear that the IRS will apply the knowingly participated in the transaction, and the manager’s procedures of section 7611 when initiating and conducting any participation was willful and not due to reasonable cause. There inquiry or examination into whether an excess benefit is also joint and several liability for this tax. An organization transaction has occurred between a church and a disqualified manager may be liable for both the tax on disqualified persons person. and on organization managers in appropriate circumstances.

An organization manager is any officer, director, or trustee of Revenue Sharing Transactions

an applicable tax-exempt organization, or any individual having Proposed intermediate sanction regulations were issued in powers or responsibilities similar to officers, directors, or 1998. The proposed regulations had special provisions covering trustees of the organization, regardless of title. An organization “any transaction in which the amount of any economic benefit manager is not considered to have participated in an excess provided to or for the use of a disqualified person is determined benefit transaction where the manager has opposed the in whole or in part by the revenues of one or more activities of transaction in a manner consistent with the fulfillment of the the organization. . .” — so-called revenue-sharing transactions. manager’s responsibilities to the organization. For example, a Rather than setting forth additional rules on revenue-sharing director who votes against giving an excess benefit would transactions, the final regulations reserve this section. ordinarily not be subject to this tax. Consequently, until the Service issues new regulations for this

A person participates in a transaction knowingly if the person reserved section on revenue-sharing transactions, these

has actual knowledge of sufficient facts so that, based solely transactions will be evaluated under the general rules (for

upon such facts, the transaction would be an excess benefit example, the fair market value standards) that apply to all

transaction. Knowing does not mean having reason to know. contractual arrangements between applicable tax-exempt

The organization manager ordinarily will not be considered organizations and their disqualified persons.

knowing if, after full disclosure of the factual situation to an Revocation of Exemption and Section 4958 appropriate professional, the organization manager relied on

the professional’s reasoned written opinion on matters within Section 4958 does not affect the substantive standards for tax

exemption under section 501(c)(3) or section 501(c)(4), the professional’s expertise or if the manager relied on the fact

that the requirements for the rebuttable presumption of including the requirements that the organization be organized

and operated exclusively for exempt purposes, and that no part reasonableness have been satisfied. Participation by an

organization manager is willful if it is voluntary, conscious, and of its net earnings inure to the benefit of any private shareholder

or individual. The legislative history indicates that in most intentional. An organization manager’s participation is due to

reasonable cause if the manager has exercised responsibility instances, the imposition of this intermediate sanction will be in

on behalf of the organization with ordinary business care and lieu of revocation. The IRS has indicated that the following

prudence. factors will be considered (among other facts and

circumstances) in determining whether to revoke an applicable Correcting an Excess Benefit Transaction tax-exempt organization’s exemption status where an excess

A disqualified person corrects an excess benefit transaction by benefit transaction has occurred:

undoing the excess benefit to the extent possible, and by taking • The size and scope of the organization’s regular and ongoing

any additional measures necessary to place the organization in activities that further exempt purposes before and after the

a financial position not worse than that in which it would be if excess benefit transaction or transactions occurred;

the disqualified person were dealing under the highest fiduciary • The size and scope of the excess benefit transaction or

standards. The organization is not required to rescind the transactions (collectively, if more than one) in relation to the

underlying agreement; however, the parties may need to modify size and scope of the organization’s regular and ongoing

an ongoing contract with respect to future payments. activities that further exempt purposes;

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• Whether the organization has been involved in multiple Schedule O (Form 990). Supplemental Information to Form

excess benefit transactions with one or more persons; 990.

• Whether the organization has implemented safeguards that Schedule R (Form 990). Related Organizations and Unrelated are reasonably calculated to prevent excess benefit Partnerships. transactions; and Forms W-2 and W-3. Wage and Tax Statement; and • Whether the excess benefit transaction has been corrected, Transmittal of Wage and Tax Statements. or the organization has made good faith efforts to seek

correction from the disqualified person(s) who benefited from Form W-9. Request for Taxpayer Identification Number and

Certification. the excess benefit transaction.

Form 940. Employer’s Annual Federal Unemployment (FUTA)

Appendix F: Forms and Publications To Tax Return.

File or Use Form 941. Employer’s QUARTERLY Federal Tax Return.

Used to report social security, Medicare, and income taxes Internet. You can access the IRS website 24 hours a day, 7 withheld by an employer and social security and Medicare taxes days a week, at www.irs.gov to: paid by an employer. • Download forms, instructions, and publications. Form 943. Employer’s Annual Tax Return for Agricultural • Order IRS products online. Employees. • Research your tax questions online. Trust Fund Recovery Penalty. If certain excise, income, • Search publications online by topic or keyword. social security, and Medicare taxes that must be collected or • View Internal Revenue Bulletins (IRBs) published in the last withheld are not collected or withheld, or these taxes are not few years. paid to the IRS, a Trust Fund Recovery Penalty may apply. The • Sign up to receive local and national tax news by email. Trust Fund Recovery Penalty may be imposed on all persons DVD for tax products. You can order Pub. 1796, IRS Tax (including volunteers) who the IRS determines were responsible Products DVD, and obtain: for collecting, accounting for, and paying over these taxes, and • Current-year forms, instructions, and publications. who acted willfully in not doing so. • Prior-year forms, instructions, and publications. This penalty does not apply to volunteer unpaid members of • Bonus: Historical Tax Products DVD-Ships with the final any board of trustees or directors of a tax-exempt organization, release.

• Tax Map: An electronic research tool and finding aid. if these members are solely serving in an honorary capacity, do

• Tax law frequently asked questions (FAQs). not participate in the day-to-day or financial activities of the

• Tax Topics from the IRS telephone response system. organization, and do not have actual knowledge of the failure to

• Fill-in, print, and save features for most tax forms. collect, account for, and pay over these taxes. However, the

• Internal Revenue Bulletins. preceding sentence does not apply if it results in no person

being liable for the penalty. • Toll-free and email technical support.

• The DVD which is released twice during the year. The penalty is equal to the unpaid trust fund tax. See Pub.

1. The first release will ship the beginning of January 2009. 15 (Circular E), Employer’s Tax Guide, for more details,

2. The final release will ship the beginning of March 2009. including the definition of responsible persons.

Purchase the DVD from National Technical Information Form 990-T. Exempt Organization Business Income Tax

Service (NTIS) at www.irs.gov/cdorders Return. Filed separately for organizations with gross income of for $30 (no handling $1,000 or more from business unrelated to the organization’s fee) or call 1-877-233-6767 toll free to buy the DVD for $30

(plus a $6 handling fee). exempt purpose. The Form 990-T is also filed to pay the section

6033(e)(2) proxy tax. For Form 990, see Part V, line 3 and its By phone and in person. You can order forms and instructions; for Form 990-EZ, see Part V, line 35 and its publications by calling 1-800-TAX-FORM (1-800-829-3676). instructions. You can also get most forms and publications at your local IRS Form 990-W. Estimated Tax on Unrelated Business Taxable office.

Income for Tax-Exempt Organizations. Other Forms That May Be Required Form 1023. Application for Recognition of Exemption under

Schedule A (Form 990 or 990-EZ). Public Charity Status or Section 501(c)(3) of the Internal Revenue Code.

Public Support. Form 1024. Application for Recognition of Exemption under

Schedule B (Form 990, 990-EZ, or 990-PF). Schedule of Section 501(a).

Contributors. Form 1040. U.S. Individual Income Tax Return.

Schedule C (Form 990 or 990-EZ). Political Campaign and Form 1041. U.S. Income Tax Return for Estates and Trusts.

Lobbying Activities. Required of section 4947(a)(1) nonexempt charitable trusts that

Schedule D (Form 990). Supplemental Financial Statements. also file Form 990 or Form 990-EZ. However, if such a trust

does not have any taxable income under Subtitle A of the Code, Schedule E (Form 990 or 990-EZ). Schools. it can file Form 990, or Form 990-EZ, and does not have to file Schedule F (Form 990). Statement of Activities Outside the Form 1041 to meet its section 6012 filing requirement. If this United States. condition is met, complete Form 990, or Form 990-EZ, and do

Schedule G (Form 990 or 990-EZ). Supplemental Information not file Form 1041.

Regarding Fundraising or Gaming Activities. A section 4947(a)(1) nonexempt charitable trust that

Schedule H (Form 990). Hospitals. normally has gross receipts of not more than $25,000 (see the

Schedule I (Form 990). Grants and Other Assistance to gross receipts discussion in Appendix B) and has no taxable

Organizations, Governments and Individuals in the U.S. income under Subtitle A must complete Part V, line 12 and the

signature block on page 1 of the Form 990. On the Form Schedule J (Form 990). Compensation Information. 990-EZ, complete line 43 and the signature block on page 4 of Schedule K (Form 990). Supplemental Information on Tax the return. In addition, complete only the following items in the Exempt Bonds. heading of Form 990 or Form 990-EZ:

Schedule L (Form 990 or Form 990-EZ). Transactions with

Interested Persons. Item

Schedule M (Form 990). Non-Cash Contributions. A Tax year (fiscal year or short period, if applicable),

Schedule N (Form 990 or 990-EZ). Liquidation, Termination, B Applicable checkboxes,

Dissolution or Significant Disposition of Assets. C Name, DBA, and address,

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D Employer identification number (EIN), and $10,000, it is not subject to the reporting requirement since the

I Section 4947(a)(1) nonexempt charitable trust box. funds were not received in the course of a trade or business.

Form 8328 Carryforward Election of Unused Private Activity Form 1096. Annual Summary and Transmittal of U.S. Bond Volume Cap. Information Returns.

Form 8718. User Fee for Exempt Organization Determination Form 1098 series. Information returns to report mortgage Letter Request. interest, student loan interest, qualified tuition and related Form 8821. Tax Information Authorization. expenses received, and a contribution of a qualified vehicle that

has a claimed value of more than $500. Form 8822. Change of Address. Used to notify the IRS of a

change in mailing address that occurs after the return is filed. Form 1099 series. Information returns to report acquisitions or

abandonments of secured property, proceeds from broker and Form 8868. Application for Extension of Time to File an

barter exchange transactions, cancellation of debt, dividends Exempt Organization Return.

and distributions, certain government and state qualified tuition Form 8870. Information Return for Transfers Associated With

program payments, taxable distributions from cooperatives, Certain Personal Benefit Contracts. Used to identify those

interest payments, payments of long-term care and accelerated personal benefit contracts for which funds were transferred to

death benefits, miscellaneous income payments, distributions the organization, directly or indirectly, as well as the transferors from an HSA, Archer MSA or Medicare Advantage MSA, for, and beneficiaries of, those contracts.

original issue discount, distributions from pensions, annuities, Form 8871. Political Organization Notice of Section 527 retirement or profit-sharing plans, IRAs, insurance contracts, Status. etc., and proceeds from real estate transactions. Also, use Form 8872. Political Organization Report of Contributions and certain of these returns to report amounts that were received as Expenditures. a nominee on behalf of another person. Form 8886. Reportable Transaction Disclosure Statement. Form 1120-POL. U.S. Income Tax Return for Certain Political

Organizations. Form 8886-T. Disclosure by Tax-Exempt Entity Regarding

Prohibited Tax Shelter Transaction. Form 1128. Application To Adopt, Change, or Retain a Tax Form 8899. Notice of Income from Donated Intellectual Year. Property. Used to report net income from qualified intellectual Form 2848. Power of Attorney and Declaration of property to the IRS and the donor. Representative. Form 8921. Applicable Insurance Contracts Information Form 3115. Application for Change in Accounting Method. Return.

Form 4506. Request for Copy of Tax Return. Form SS-4. Application for Employer Identification Number.

Form 4506-A. Request for Public Inspection or Copy of Form TD F 90-22.1. Report of Foreign Bank and Financial Exempt or Political Organization IRS Form. Accounts.

Form 4562. Depreciation and Amortization. Helpful Publications Form 4720. Return of Certain Excise Taxes on Charities and

Other Persons Under Chapters 41 and 42 of the Internal Publication 15. Circular E, Employer’s Tax Guide.

Revenue Code. Publication 15-A. Employer’s Supplemental Tax Guide

(Fringe Benefits). Form 5500. Annual Return/Report of Employee Benefit Plan.

Employers who maintain pension, profit-sharing, or other Publication 463. Travel, Entertainment, Gift, and Car

funded deferred compensation plans are generally required to Expenses.

file the Form 5500. This requirement applies whether or not the Publication 525. Taxable and Nontaxable Income.

plan is qualified under the Internal Revenue Code and whether Publication 526. Charitable Contributions. or not a deduction is claimed for the current tax year. Publication 538. Accounting Periods and Methods. Form 5578. Annual Certification of Racial Nondiscrimination Publication 557. Tax-Exempt Status for Your Organization. for a Private School Exempt From Federal Income Tax. Publication 561. Determining the Value of Donated Property. Form 5768. Election/Revocation of Election by an Eligible

Section 501(c)(3) Organization To Make Expenditures To Publication 598. Tax on Unrelated Business Income of

Exempt Organizations. Influence Legislation.

Publication 892. Organization Appeal Procedures for Form 7004. Application for Automatic Extension of Time to Unagreed Issues. File Corporation Income Tax Return.

Publication 910. IRS Guide to Free Tax Services. Form 8038. Information Return for Tax-Exempt Private Activity

Bond Issues. Publication 946. How To Depreciate Property.

Form 8274. Certification by Churches and Qualified Publication 947. Practice Before the IRS and Power of

Church-Controlled Organizations Electing Exemption from Attorney

Employer Social Security and Medicare Taxes. Publication 1771. Charitable Contributions— Substantiation

Form 8282. Donee Information Return. Required of the donee and Disclosure Requirements.

of charitable deduction property who sells, exchanges, or Publication 1779. Employee Independent Contractor

otherwise disposes of donated property within 3 years after Brochure

receiving it. The form is also required of any successor donee Publication 1828. Tax Guide for Churches and Religious who disposes of charitable deduction property within 3 years Organizations. after the date that the donor gave the property to the original Publication 3079. Gaming Publication for Tax-Exempt donee. It does not matter who gave the property to the Organizations. successor donee. It may have been the original donee or Publication 3386. Tax Guide for Veterans Organizations. another successor donee.

Publication 3833. Disaster Relief, Providing Assistance Form 8283. Noncash Charitable Contributions. through Charitable Organizations. Form 8300. Report of Cash Payments Over $10,000 Received Publication 4220. Applying for 501(c)(3) Tax-Exempt Status. in a Trade or Business. Used to report cash amounts in excess

of $10,000 that were received in a single transaction (or in two Publication 4221-PC. Compliance Guide for 501(c)(3) Public

or more related transactions) in the course of a trade or Charities.

business (as defined in section 162). However, if the Publication 4221-PF. Compliance Guide for 501(c)(3) Private

organization receives a charitable cash contribution in excess of Foundations.

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Publication 4302. A Charity’s Guide to Vehicle Donations. Even if the Form 990 or 990-EZ that the organization files

Publication 4303. A Donor’s Guide to Vehicle Donations. with the IRS is accepted by the IRS as complete, a copy of the

same return filed with a state will not fully satisfy that state’s Publication 4630. Exempt Organizations Products and filing requirement if (1) required information is not provided, Services Navigator. including any of the additional information discussed above, or

Appendix G: Use of Form 990 or Form (2) the state determines that the form was not completed by

following the applicable Form 990 or 990-EZ instructions or

990-EZ To Satisfy State Reporting supplemental state instructions. In such case, the state may ask

the organization to provide the missing information or to submit Requirements an amended return.

Some states and local government units will accept a copy of

Form 990 or Form 990-EZ in place of all or part of their own Use Of Audit Guides May Be Required

financial report forms. The substitution applies primarily to To ensure that all organizations report similar transactions

section 501(c)(3) organizations, but some of the other types of uniformly, many states require that contributions, gifts, grants,

section 501(c) organizations are also affected. If the etc., and functional expenses be reported according to the

organization uses Form 990 or 990-EZ to satisfy state or local AICPA industry audit and accounting guide, Not-for-Profit

filing requirements, such as those under state charitable Organizations (New York, NY, AICPA, 2003), supplemented by

solicitation acts, note the following discussions. Standards of Accounting and Financial Reporting for Voluntary

Health and Welfare Organizations (Washington, DC, National Determine State Filing Requirements Health Council, Inc., 1998, 4th edition). The organization may consult the appropriate officials of all

states and other jurisdictions in which it does business to Donated Services And Facilities

determine their specific filing requirements. Doing business in a Even though reporting donated services and facilities as items jurisdiction may include any of the following: (a) soliciting of revenue and expense is called for in certain circumstances contributions or grants by mail or otherwise from individuals, by the two publications named above, many states and the IRS businesses, or other charitable organizations; (b) conducting do not permit the inclusion of those amounts in Parts VIII and IX programs; (c) having employees within that jurisdiction; (d) of Form 990 or Part I of Form 990-EZ. The optional reporting of maintaining a checking account; or (e) owning or renting donated services and facilities is discussed in the instructions

property there. for Part III for both Form 990 and Form 990-EZ.

Monetary Tests May Differ Amended Returns

Some or all of the dollar limitations applicable to Form 990 or If the organization submits supplemental information or files an 990-EZ when filed with the IRS may not apply when using Form amended Form 990 or 990-EZ with the IRS, it must also send a 990 or 990-EZ in place of state or local report forms. Examples copy of the information or amended return to any state with of the IRS dollar limitations that do not meet some state which it filed a copy of Form 990 or 990-EZ originally to meet requirements are the normally $25,000 gross receipts minimum that state’s filing requirement. If a state requires the that creates an obligation to file with the IRS and the $100,000 organization to file an amended Form 990 or 990-EZ to correct minimum for listing independent contractors in Form 990, Part conflicts with the Form 990 or 990-EZ instructions, the VII, Section B, or Form 990-EZ, Part VI, line 51. organization must also file an amended return with the IRS.

Additional Information May Be Required Method of Accounting

State or local filing requirements may require the organization Most states require that all amounts be reported based on the to attach to Form 990 or 990-EZ one or more of the following: accrual method of accounting. See also General Instruction D. (a) additional financial statements, such as a complete analysis

of functional expenses or a statement of changes in net assets; Time For Filing May Differ

(b) notes to financial statements; (c) additional financial The deadline for filing Form 990 or 990-EZ with the IRS differs schedules; (d) a report on the financial statements by an from the time for filing reports with some states. independent accountant; and (e) answers to additional

questions and other information. Each jurisdiction may require Public Inspection

the additional material to be presented on forms they provide. The Form 990 or 990-EZ information made available for public

The additional information does not have to be submitted with inspection by the IRS may differ from that made available by

the Form 990 or 990-EZ filed with the IRS. the states, such as Schedule B (Form 990, 990-EZ, or 990-PF).

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Privacy Act and Paperwork Reduction Act Notice We ask for the information on these forms to carry out the Internal Revenue

laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws

and to allow us to figure and collect the right amount of tax. Section 6109 requires return preparers to provide their identifying

numbers on the return.

You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the

form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their

contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are

confidential, as required by section 6103.

The time needed to complete and file this form and related schedules will vary depending on individual circumstances. The

estimated average times are:

Form Recordkeeping Learning about the law or Preparing Copying, assembling,

the form the and sending the form

form to the IRS

990-EZ 29 hr., 10 min. 11 hr., 33 min. 14 hr., 24 min. 32 min.

Schedule A (Form 990 or 990-EZ) 39 hr., 56 min. 6 hr., 51 min. 7 hr., 48 min. - - - - -

Schedule B (Form 990, 990-EZ, or 5 hr., 58 min. 1 hr., 35 min. 1 hr., 45 min. - - - - -

990-PF)

Schedule C (Form 990 or 990-EZ) 22 hr., 0 min. 42 min. 1 hr., 5 min. - - - - -

Schedule E (Form 990 or 990-EZ) 5 hr., 30 min. 53 min. 1 hr., 1 min. - - - - -

Schedule G (Form 990 or 990-EZ) 24 hr., 9 min. 24 min. 48 min. - - - - -

Schedule L (Form 990 or 990-EZ) 5 hr., 30 min. 1 hr., 5 min. 1 hr., 13 min. - - - - -

Schedule N (Form 990 or 990-EZ) 7 hr., 53 min. 42 min. 51 min. - - - - -

We welcome comments on forms. If you have comments concerning the accuracy of these time estimates or suggestions for

making these forms simpler, we would be happy to hear from you. You can write to the Internal Revenue Service, Tax Products

Coordinating Committee, SE:W:CAR:MP:T:T:SP, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224.

Do not send the form to this address. Instead, see When, Where, and How To File in General Instruction E.

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Index

A Compensation ..................... 14, 16, 21 Financial account . . . . . . . . . . . . . . . . . . . . . . . . . 19

Accountant ................................ 7 Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Fiscal year ................................ 4

Accounting: Reasonable ......................... 30, 31 Five highest compensated employees . . . . . 21

Method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 35 Reportable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Fixed payment . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Period .................................. 4 Conformed copy . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Foreign country ........................... 5

Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . 14 Contemporaneous . . . . . . . . . . . . . . . . . . . . . . . . 30 Foreign organization (See Organization)

Accounts receivable . . . . . . . . . . . . . . . . . . . . . . 14 Contracts: Forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Accrual (method) . . . . . . . . . . . . . . . . . . . . . . . . . 35 Initial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Form 1023, Application for Recognition of

Address .................................. 7 Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 12 Exemption Under Section 501(c)(3) of the

Change of . . . . . . . . . . . . . . . . . . . . . . . . . . . 7, 34 Contributors: Internal Revenue Code ................ 4

Website ................................ 8 Schedule of . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Form 1024, Application for Recognition of

Advance ruling period ...................... 4 Controlled entity . . . . . . . . . . . . . . . . . . . . . . . . 3, 20 Exemption Under Section 501(a) or for

AKA or a.k.a. (See Name and address) Controlling organization . . . . . . . . . . . . . . . . . 3, 20 Determination Under Section 120 ...... 4

Copies Form 1041, U.S. Income Tax Return for Amended return . . . . . . . . . . . . . . . . . . . . . . . . . . 35 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Estates and Trusts .................... 4 Description of amendments .............. 5 Form 1065, U.S. Return of Partnership Annual information return . . . . . . . . . . . . . . . 2, 28 D Income ............................... 4 Anti-abuse rule . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Defined contribution plan Form 1099-MISC, Miscellaneous Income, . . . . . . . . . . . . . . . . . . 16 Appendix: Depreciation Methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Appendix A Exempt Organizations Form 1120-POL, U.S. Income Tax Return for Reference Chart Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 . . . . . . . . . . . . . . . . . . . . . 23 Certain Political Organizations . . . . . . . . 18

Appendix B How to Determine Whether an Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Form 1128, Application To Adopt, Change, Organization’s Gross Receipts are Disqualified person . . . . . . . . . . . . . . . . . . . . . . . 29 or Retain a Tax Year .................. 4 Normally $25,000 (or $5,000) or Disregarded entities ....................... 6 Form 3115, Application for Change in Less . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Accounting Method .................... 5 Appendix C Special Gross Receipts Test for Dividends ............................. 11, 19 Form 4506, Request for Copy of Tax Determining Exempt Status of Section Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Return ................................ 5 501(c)(7) and 501(c)(15) Donations: Form 4506-A, Request for Public Inspection Organizations . . . . . . . . . . . . . . . . . . . . . . . . 25 Of services or Copy of Exempt or Political . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Appendix D Public Inspection of Of use of property . . . . . . . . . . . . . . . . . . . . . . 10 Organization IRS Form . . . . . . . . . . . . . . . 25

Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Form 4720, Return of Certain Excise Taxes Donor advised fund . . . . . . . . . . . . . . . . . . . . . . . 20 Appendix E Section 4958 Excess Benefit on Charities and Other Persons Under Donor advisor ....................... 20, 30 Transactions . . . . . . . . . . . . . . . . . . . . . . . . . 29 Chapters 41 and 42 of the Internal Sponsoring organization . . . . . . . . . . . . . . 3, 19 Appendix F Forms and Publications To File Revenue Code ................ 18, 19, 20 Supporting organization . . . . . . . . . . . . . . . . . 30 or Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Form 5500, Annual Certification of Racial Appendix G Use of Form 990 or 990-EZ To Dues and assessments .................... 9 Nondiscrimination for a Private School Satisfy State Reporting Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Exempt from Federal Income Tax ...... 4

Requirements . . . . . . . . . . . . . . . . . . . . . . . . 35 Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Form 8822, Change of Address .......... 7 Nondeductible . . . . . . . . . . . . . . . . . . . . . . . . . 17 Application for tax exemption . . . . . . . . . . . . . . 26 Form 8868, Application for Extension of

Application pending ........................ 4 Time To File an Exempt Organization

Assets: E Return ................................ 5

Net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Form 8870, Information Return for Transfers Economic benefit: Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Associated With Certain Personal Benefit Disregarded . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Interest on loans (foregone) . . . . . . . . . . . . . 30

Assistance to individuals Form 8886-T, Disclosure by Tax-Exempt . . . . . . . . . . . . . . . . . . 13 Liability insurance premiums . . . . . . . . . . . . 30

Attachments Entity Regarding Prohibited Tax Shelter . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1, 6 Nontaxable fringe . . . . . . . . . . . . . . . . . . . . . . 31 Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Attorney .................................. 7 Electronic filing ............................ 5 Form 941, Employer’s Quarterly Federal Tax Audit guides . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Element of common control . . . . . . . . . . . . . . . 21 Return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Email subscription ......................... 2 Form 990-BL, Information and Initial Excise

Employee benefits . . . . . . . . . . . . . . . . . . . . . . . . 13 Tax Return for Black Lung Benefit Trusts B Employer identification number (EIN) ....... 7 and Certain Related Persons .......... 4 Balance sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Excess benefit transaction ..... 19, 29, 30, 32 Form 990-N, Electronic Notice (e-Postcard) Bank account . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Excise tax for Tax-Exempt Organizations not ......................... 18, 19, 32 Bingo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Required To File Form 990 or Exempt purpose . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Black lung benefit trusts .................... 4 990-EZ ............................... 3 Expenses: Book value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Form 990-PF, Return of Private Foundation Direct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Books and records or Section 4947(a)(1) Nonexempt .................... 11, 19 Functional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Charitable Trust Treated as a Private Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Fundraising . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Foundation ........................... 4 Business activities . . . . . . . . . . . . . . . . . . . . . . . . 10 Program service . . . . . . . . . . . . . . . . . . . . . . . . 11 Form 990-T, Exempt Organization Business Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Income Tax Return ................ 17, 18 Extension of time to file .................... 5 Form W-2, Wage and Tax Statement . . . . 16 C Fringe benefits ........................ 30, 31 Calendar year . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 7 De minimis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Candidates for public office F ............ 18, 20 Working condition . . . . . . . . . . . . . . . . . . . . . . 16 Capital contributions Fair market value ...................... 30, 31 . . . . . . . . . . . . . . . . . . . . . . 18 Fund balances . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Capital gains Federal unemployment tax (FUTA) . . . . . . . . 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Fundraising . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 10 Cash Federated fundraising agencies . . . . . . . . . . . 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 FUTA (See Federal unemployment tax) Cash receipts and disbursements Fees: .......... 5 Copies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Certificates of deposit .................. 11, 14 Fundraising . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Changes in net assets ................. 14, 35 G Government . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Children: Gaming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Initiation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Photographs of missing .................. 2 Gifts ...................................... 9 Laboratory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Church . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 32 Membership . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Goods or services . . . . . . . . . . . . . . . . . . . . . . . . 13

Church-affiliated organization .............. 4 Professional . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Governing documents . . . . . . . . . . . . . . . . . . . . 16

Club facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Grants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9, 13

Commercial co-venture . . . . . . . . . . . . . . . . . . . 10 Final return ................................ 5 Gross receipts ......................... 18, 24

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Gross rental income . . . . . . . . . . . . . . . . . . . . . . 11 O Recordkeeping ............................ 6

Gross revenue (See Revenue) Occupancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Related Organization (See Organization)

Gross sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Religious order ............................ 3

Group exemption number (GEN) ........... 8 Offices: Rent Expenses (See Expenses)

Group return .............................. 4 Permanent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Reportable compensation (See

Regional or district .................. 26, 27 Compensation)

Organization: Revenue .................................. 9

H Affiliated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Heath benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 29 Gross .............................. 11, 12

Help ...................................... 2 Political . . . . . . . . . . . . . . . . . . . . . . . 4, 18, 20, 26 Program service . . . . . . . . . . . . . . . . . . . . . . . . 10

Helpful hints ............................... 2 Related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Revenue sharing transactions . . . . . . . . . . . . . 32

Helpful publications Religious . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 4 . . . . . . . . . . . . . . . . . . . . . . . 34 Revocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Supporting . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 30 Historic and continuing relationship . . . . . . . . 21 Rounding off .............................. 6 Organization managers . . . . . . . . . . . . . . . . . . . 32 Hours per week . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Royalties .......................... 10, 11, 13 Organizing document . . . . . . . . . . . . . . . . . . . . . 16

Other Assets (See Assets)

I S

Incomplete return .......................... 6 Salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 P Sale: Independent contractors ............... 14, 21

Instant bingo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Paid preparer . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Identifying number of . . . . . . . . . . . . . . . . . . . 22 Of inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Payments: Of merchandise . . . . . . . . . . . . . . . . . . . . . . . . 11 Integrated auxiliary ........................ 3 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . 30 Of securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Government ............................ 9 Sale of securities (See Sale) Mortgage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Independent contractors . . . . . . . . . . . . . . . . 14 Savings ............................... 11, 14 Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Nonfixed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Savings accounts (See Savings) Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 33 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Severance .......................... 16, 30 Schedule A (Form 990 or 990-EZ), Public Investment: To affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Charity Status and Public Support . . . . . . 8, Program-related ..................... 10, 11 Payroll taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 20 Rental income . . . . . . . . . . . . . . . . . . . . . . . . . 11 Penalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Schedule B (Form 990, 990-EZ, or 990-PF), Failure to file ............................ 6 Schedule of Contributors . . . . . . . . 2, 8, 35 Personal benefit contract . . . . . . . . . . . . . . . . . . 20 K Schedule C (Form 990 or 990-EZ), Political Phone Help ............................... 2 Campaign and Lobbying Activities . . . . 17, Key employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Political campaign activities . . . . . . . . . . . . . . . 20 20

Political expenditures . . . . . . . . . . . . . . . . . . . . . 18 Schedule E (Form 990 or 990-EZ),

L Political organization (See Organization) Schools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Postage Schedule G (Form 990 or 990-EZ), Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Supplemental Information Regarding Late filing ................................. 6 Printing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Fundraising or Gaming Activities . . . . . . 12 Liabilities, total . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Prior period adjustment .................... 5 Schedule L (Form 990 or 990-EZ), Liquidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Private delivery services ................... 5 Transactions With Interested

List of officers directors, trustees, and key Private foundation ......................... 4 Persons .......................... 18, 19

employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Professional fees (See Fees) Schedule N (Form 990 or 990-EZ),

List of required schedules and Program services . . . . . . . . . . . . . . . . . . . . . . . . . 10 Liquidation, Termination, Dissolution, or

attachments ............................. 6 Program-related investment (See Investment) Significant Disposition of Assets . . . . . 5, 7,

Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Proxy tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18

Lobbying: Public charity . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 19 School . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Direct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Public inspection . . . . . . . . . . . . 6, 25, 26, 27, 35 Securities ............................. 11, 14

Grassroots . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Publications: Securities account . . . . . . . . . . . . . . . . . . . . . . . . 19

Lobbying expenses . . . . . . . . . . . . . . . . . . . . . . . 17 Helpful . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Severance payments (See Payments)

Local or subordinate organizations . . . . . . . . . 26 Pub. 15, Circular E Employer’s Tax SFAS 116, Accounting for Contributions

Lotteries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Guide ............................ 15, 33 Received and Contributions Made . . . . . 5, 9,

Pub. 15-A, Employer’s Supplemental Tax 14

Guide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Shipping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

M Pub. 1771, Charitable Short accounting period or short year ....... 4

Maintenance expense . . . . . . . . . . . . . . . . . . . . 14 Contributions—Substantiation and Signature ................................. 6

Major disposition of assets . . . . . . . . . . . . . . . . 18 Disclosure Requirements .............. 9 Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Medicare taxes Pub. 1779, Independent Contractor or . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Block . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Membership benefits Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 . . . . . . . . . . . . . . . . . . . . . 11 Social security number . . . . . . . . . . . . . . . . . . . . 22 Pub. 463, Travel, Entertainment, Gift, and Membership dues and assessments (See Social security taxes . . . . . . . . . . . . . . . . . . . . . . 13 Car Expenses . . . . . . . . . . . . . . . . . . . . . . . . 10 Dues and assessments) Pub. 525, Taxable and Nontaxable Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Merger, Articles of ......................... 7 Income ........................... 16, 21 Special events . . . . . . . . . . . . . . . . . . . . . . . . . 9, 11

Miscellaneous expenses . . . . . . . . . . . . . . . . . . 14 Pub. 526, Charitable Contributions . . . . 9, 10 Specific Instructions ....................... 7

Miscellaneous income . . . . . . . . . . . . . . . . . . . . 16 Pub. 538, Accounting Periods and State filing requirements . . . . . . . . . . . . . . . . 5, 35

Mission society ............................ 4 Methods .............................. 4 State reporting requirements . . . . . . . . . . . . 5, 35

Money market funds . . . . . . . . . . . . . . . . . . . . . . 14 Pub. 557, Tax-Exempt Status for Your Statement of Program Service Mortgage interest (See Interest) Organization .......................... 6 Accomplishments . . . . . . . . . . . . . . . . . . . . . . 15 Pub. 598, Tax on Unrelated Business Substantial contraction . . . . . . . . . . . . . . . . . . . . 18 Income of Exempt Organizations . . . . . 12, Substantial contributor . . . . . . . . . . . . . . . . . . . . 30 N 17 Substantial influence . . . . . . . . . . . . . . . . . . . . . . 29 Name and address ........................ 7 Pub. 946, How To Depreciate

Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Substantiation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Name change ............................. 7

Pub. 947, Practice Before the IRS and Substitute forms . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Net assets (See Assets) Power of Attorney . . . . . . . . . . . . . . . . . . . . 22 Supporting organization (See Organization) Noncash contributions . . . . . . . . . . . . . . . . . . . . 10 Pull tabs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Sweepstakes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Nondiscrimination policy . . . . . . . . . . . . . . . . . . 19 Purpose of form ........................... 2 Nonexempt charitable trust . . . . . . . . . . . . . . . . 19

Nonfixed payments (See Payments) T

Notes receivable . . . . . . . . . . . . . . . . . . . . . . . . . 13 R Tax shelter transaction . . . . . . . . . . . . . . . . . . . . 19

Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Raffles ................................ 11, 12 Tax year .................................. 7

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Taxes ......................... 13, 14, 19, 32 U W

Telephone number ........................ 8 U.S. possession ........................... 3 Website (See Address)

Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7, 18 U.S. Treasury bills ..................... 11, 14 Who must file ............................. 3

Total assets (See Assets) Unrelated trade or business . . . . . . . . . . . . . . . 10

Transfers: Income ............................. 17, 26 ■

Personal benefit contracts . . . . . . . . . . . . . . 20 Income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

To exempt non-charitable related Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

organizations . . . . . . . . . . . . . . . . . . . . . . . . 20

Trust, section 4947(a)(1) . . . . . . . . . . . . . . . . 3, 19 V

Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Value:

Nominal or insubstantial ................. 9

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