Most taxpayers file one of the various 1040 forms in order to report their income and taxes. There are groups who are tax-exempt but must still file tax returns to the IRS to prove that they are working within the parameters of their tax status. These tax-exempt organizations must file IRS Form 990. These forms are available for public scrutiny as well, which is why the IRS warns filers not to use Social Security numbers on the forms. Instead, filers should use an employee identification number (EIN) provided by the IRS. According to the law, nothing can be added or hidden from these returns before they are presented publicly.
There are different classes of tax-exempt organizations who must file either IRS Form 990 or another type of this same form. In order to file this tax return, the filing entity must have more than $200,000 in what are called gross receipts. In essence, that is all the income and money received from a source before costs and expenses are subtracted. The other requirement is that the organization must have greater than $500,000 in total assets in order to file with this form. This includes bank accounts, properties and equipment. Those tax-exempt filers showing lesser amounts are able to file a Form 990-EZ.
Religious orders, some government organizations and groups with total gross receipts normally under $50,000 do not have to file IRS Form 990, but they may be expected to report to the IRS with a Form 990-N or other form. There are many particulars as to which entities must file with which form. It is vital to seek the advice of a tax professional in order to file properly. Failing to file or filing improperly can result in penalties and fees. Failure to file for three years can result in the revocation of an organization’s tax-exempt status. A qualified tax expert can help to make filing easier as well as answer questions about these and other tax forms.