Use IRS Package 1023 for that purpose. Nonprofit organizations may be required to file an annual information return using IRS Form 990 or Form 990 EZ, depending on the organization's financial situation for the year. Click here for IRS Form 990. Click here for the instructions for Form 990, Schedule A. A nonprofit organization needs to keep good books and minutes of meetings for required reports, such as the IRS information returns and grant reports. A CPA can help set up the organization's books so that they are easier to keep accurately and also less expensive to audit.
Many foundations require audits as a condition of grants.
It is appropriate to budget sufficient funds for bookkeeping, audits and also to purchase liability insurance for the organization and its directors and officers. At the end of the five year period, additional information is submitted to the IRS to obtain a final ruling. Click here for some more information about advance rulings. Additional nonprofit organization resources are provided below. GuideStar's searchable database of more than 640,000 nonprofit organizations in the United States.