Return of Organization Exempt From Income Tax and
Short Form Return of Organization Exempt From Income Tax

D. Forms and Publications To File or Use

Personal computer. You can access the IRS Web Site 24 hours a day, 7 days a week at www.irs.gov to:

• Download forms, instructions, and publications.
• See answers to frequently asked tax questions.
• Search publications on-line by topic or keyword.
• Send us comments or request help via e-mail.
• Sign up to receive local and national tax news by e-mail.

You can also reach us using file transfer protocol at ftp.irs.gov.

CD-ROM. Order Pub. 1796, IRS Federal Tax Products on CD-ROM, and get:

• Current year forms, instructions, and publications.
• Prior year forms, instructions, and publications.
• Frequently requested forms that may be filled in electronically, printed out for submission, and saved for recordkeeping.
• The Internal Revenue Bulletin.

Buy the CD-ROM on the Internet at www.irs.gov/cdorders from the National Technical Information Service (NTIS) for $21 (no handling fee), or call 1-877-CDFORMS (1-877-233-6767) toll free to buy the CD-ROM for $21 (plus a $5 handling fee).

By phone and in person. You can order forms and publications 24 hours a day, 7 days a week, by calling 1-800-TAX-FORM (1-800-829-3676). You can also get most forms and publications at your local IRS office.

Schedule A (Form 990 or 990-EZ). Organization Exempt Under Section 501(c)(3) (Except Private Foundation), 501(e), 501(f), 501(k), 501(n), or Section 4947(a)(1) Nonexempt Charitable Trust. The Schedule A (Form 990 or 990-EZ) is filed with Form 990, or Form 990-EZ, for a section 501(c)(3) organization that is not a private foundation (and including an organization described in section 501(e), 501(f), 501(k), or 501(n)). It is also filed with Form 990, or Form 990-EZ, for a section 4947(a)(1) nonexempt charitable trust that is not treated as a private foundation. An organization is not required to file Schedule A (Form 990 or 990-EZ) if its gross receipts are normally $25,000 or less. See the gross receipts discussion in General Instruction B.

Schedule B (Form 990, 990-EZ, or 990-PF). Schedule of Contributors. Schedule B (Form 990, 990-EZ, or 990-PF) is used by all organizations required to file Form 990, 990-EZ, or 990-PF, to provide the contributor information required for line 1 of those forms.

Forms W-2 and W-3. Wage and Tax Statement and Transmittal of Wage and Tax Statements.

Form W-9. Request for Taxpayer Identification Number and Certification.

Form 940. Employer's Annual Federal Unemployment (FUTA) Tax Return.

Form 941. Employer's Quarterly Federal Tax Return. Used to report social security, Medicare, and income taxes withheld by an employer and social security and Medicare taxes paid by an employer.

Form 943. Employer's Annual Tax Return for Agricultural Employees.

Trust Fund Recovery Penalty. If certain excise, income, social security, and Medicare taxes that must be collected or withheld are not collected or withheld, or these taxes are not paid to the IRS, a Trust Fund Recovery Penalty may apply. The Trust Fund Recovery Penalty may be imposed on all persons (including volunteers) who the IRS determines were responsible for collecting, accounting for, and paying over these taxes, and who acted willfully in not doing so.

This penalty does not apply to volunteer, unpaid members of any board of trustees or directors of a tax-exempt organization, if these members are solely serving in an honorary capacity, do not participate in the day-to-day or financial activities of the organization, and do not have actual knowledge of the failure to collect, account for, and pay over these taxes. However, the preceding sentence does not apply if it results in no person being liable for the penalty.

The penalty is equal to the unpaid trust fund tax. See the instructions for Pub. 15 (Circular E), Employer's Tax Guide, for more details, including the definition of responsible persons.

Form 990-T. Exempt Organization Business Income Tax Return. Filed separately for organizations with gross income of $1,000 or more from business unrelated to the organization's exempt purpose. The Form 990-T is also filed to pay the section 6033(e)(2) proxy tax. For Form 990, see line 85 and its instructions; for Form 990-EZ, see line 35 and its instructions.

Form 990-W. Estimated Tax on Unrelated Business Taxable Income for Tax-Exempt Organizations.

Form 1040. U.S. Individual Income Tax Return.

Form 1041. U.S. Income Tax Return for Estates and Trusts. Required of section 4947(a)(1) nonexempt charitable trusts that 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, it can file Form 990, or Form 990-EZ, and does not have to file Form 1041 to meet its section 6012 filing requirement. If this condition is met, complete Form 990, or Form 990-EZ, and do not file Form 1041.

A section 4947(a)(1) nonexempt charitable trust that normally has gross receipts of not more than $25,000 (see the gross receipts discussion in General Instruction B) and has no taxable income under Subtitle A must complete line 92 and the signature block on page 6 of the Form 990. On the Form 990-EZ, complete line 43 and the signature block on page 2 of the return. In addition, complete only the following items in the heading of Form 990 or Form 990-EZ:

Form 1096. Annual Summary and Transmittal of U.S. Information Returns.

Form 1098 series. Information returns to report student loan interest and tuition and related expenses received.

Form 1099 series. Information returns to report acquisitions or abandonments of secured property, proceeds from broker and barter exchange transactions, cancellation of debt, dividends and distributions, certain government and state qualified tuition program payments, taxable distributions from cooperatives, interest payments, payments of long-term care and accelerated death benefits, miscellaneous income payments, distributions from a medical savings account, original issue discount, distributions from pensions, annuities, retirement or profit-sharing plans, IRAs, insurance contracts, etc., and proceeds from real estate transactions. Also, use certain of these returns to report amounts that were received as a nominee on behalf of another person.

Form 1120-POL. U.S. Income Tax Return for Certain Political Organizations.

Form 1128. Application To Adopt, Change, or Retain a Tax Year.

Form 3115. Application for Change in Accounting Method.

Form 4506-A. Request for Public Inspection or Copy of Exempt or Political Organization IRS Form.

Form 4562. Depreciation and Amortization.

Form 4720. Return of Certain Excise Taxes on Charities and Other Persons Under Chapters 41 and 42 of the Internal Revenue Code.

Form 5500. Annual Return/Report of Employee Benefit Plan. Employers who maintain pension, profit-sharing, or other funded deferred compensation plans are generally required to file the Form 5500. This requirement applies whether or not the plan is qualified under the Internal Revenue Code and whether or not a deduction is claimed for the current tax year.

Form 5768. Election/Revocation of Election by an Eligible Section 501(c)(3) Organization To Make Expenditures To Influence Legislation.

Form 8282. Donee Information Return. Required of the donee of charitable deduction property who sells, exchanges, or otherwise disposes of the property within 2 years after receiving the property.

The form is also required of any successor donee who disposes of charitable deduction property within 2 years after the date that the donor gave the property to the original donee. It does not matter who gave the property to the successor donee. It may have been the original donee or another successor donee.

Form 8283. Noncash Charitable Contributions.

Form 8300. Report of Cash Payments Over $10,000 Received 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 or more related transactions) in the course of a trade or business (as defined in section 162).

However, if the organization receives a charitable cash contribution in excess of $10,000, it is not subject to the reporting requirement since the funds were not received in the course of a trade or business.

Form 8822. Change of Address. Used to notify the IRS of a change in mailing address that occurs after the return is filed.

Form 8868. Application for Extension of Time To File an Exempt Organization Return.

Form 8870. Information Return for Transfers Associated With Certain Personal Benefit Contracts. Used to identify those personal benefit contracts for which funds were transferred to the organization, directly or indirectly, as well as the transferors for, and beneficiaries of, those contracts.

Form 8871. Political Organization Notice of Section 527 Status.

Form 8872. Political Organization Report of Contributions and Expenditures.

Publication 463. Travel, Entertainment, Gift, and Car Expenses.

Publication 525. Taxable and Nontaxable Income.

Publication 526. Charitable Contributions.

Publication 538. Accounting Periods and Methods.

Publication 598. Tax on Unrelated Business Income of Exempt Organizations.

Publication 910. Guide to Free Tax Services.

Publication 946. How To Depreciate Property.

Publication 1771. Charitable Contributions - Substantiation and Disclosure Requirements.

E. Use of Form 990, or Form 990-EZ, To Satisfy State Reporting Requirements

Some states and local government units will accept a copy of Form 990, or Form 990-EZ, Schedule A (Form 990 or 990-EZ), and Schedule B (Form 990, 990-EZ, or 990-PF) in place of all or part of their own financial report forms. The substitution applies primarily to section 501(c)(3) organizations, but some of the other types of section 501(c) organizations are also affected.

If you use Form 990, or Form 990-EZ, to satisfy state or local filing requirements, such as those under state charitable solicitation acts, note the following -

Determine state filing requirements

You should consult the appropriate officials of all states and other jurisdictions in which the organization does business to determine their specific filing requirements. Doing business in a jurisdiction may include any of the following: (a) soliciting contributions or grants by mail or otherwise from individuals, businesses, or other charitable organizations; (b) conducting programs; (c) having employees within that jurisdiction; (d) maintaining a checking account; or (e) owning or renting property there.

Monetary tests may differ

Some or all of the dollar limitations applicable to Form 990, or Form 990-EZ, when filed with the IRS may not apply when using Form 990, or Form 990-EZ, in place of state or local report forms. Examples of the IRS dollar limitations that do not meet some state requirements are the $25,000 gross receipts minimum that creates an obligation to file with the IRS (see the gross receipts discussion in General Instruction B) and the $50,000 minimum for listing professional fees in Part II of Schedule A (Form 990 or 990-EZ).

Additional information may be required

State or local filing requirements may require you to attach to Form 990, or Form 990-EZ, one or more of the following: (a) additional financial statements, such as a complete analysis of functional expenses or a statement of changes in net assets; (b) notes to financial statements; (c) additional financial schedules; (d) a report on the financial statements by an independent accountant; and (e) answers to additional questions and other information. Each jurisdiction may require the additional material to be presented on forms they provide. The additional information does not have to be submitted with the Form 990, or Form 990-EZ, filed with the IRS.

Even if the Form 990, or Form 990-EZ, the organization files 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 filing requirement if required information is not provided, including any of the additional information discussed above, or if the state determines that the form was not completed by following the applicable Form 990, or Form 990-EZ, instructions or supplemental state instructions. If so, the organization may be asked to provide the missing information or to submit an amended return.

Use of audit guides may be required

To ensure that all organizations report similar transactions uniformly, many states require that contributions, gifts, grants, etc., and functional expenses be reported according to the AICPA industry audit guide, Not-For-Profit Organizations (New York, NY, AICPA, 2001), supplemented by Standards of Accounting and Financial Reporting for Voluntary Health and Welfare Organizations (Washington, DC, National Health Council, Inc., 1998, 4th edition).

Donated services and facilities

Even though reporting donated services and facilities as items of revenue and expense is called for in certain circumstances by the two publications named above, many states and the IRS do not permit the inclusion of those amounts in Parts I and II of Form 990 or Part I of Form 990-EZ. The optional reporting of donated services and facilities is discussed in the instructions for Part III for both Form 990 and Form 990-EZ.

Amended returns

If the organization submits supplemental information or files an amended Form 990, or Form 990-EZ, with the IRS, it must also send a copy of the information or amended return to any state with which it filed a copy of Form 990, or Form 990-EZ, originally to meet that state's filing requirement.

If a state requires the organization to file an amended Form 990, or Form 990-EZ, to correct conflicts with Form 990, or Form 990-EZ, instructions, it must also file an amended return with the IRS.

Method of accounting

Most states require that all amounts be reported based on the accrual method of accounting. See also General Instruction G.

Time for filing may differ

The deadline for filing Form 990, or Form 990-EZ, with the IRS differs from the time for filing reports with some states.

Public inspection

The Form 990, or Form 990-EZ, information made available for public inspection by the IRS may differ from that made available by the states. See the discussion for the required schedule of contributors (Schedule B (Form 990, 990-EZ, or 990-PF) in General Instruction L.

F. Other Forms as Partial Substitutes for Form 990 or Form 990-EZ

Except as provided below, the Internal Revenue Service will not accept any form as a substitute for one or more parts of Form 990 or Form 990-EZ.

Labor organizations (section 501(c)(5))

A labor organization that files Form LM-2, Labor Organization Annual Report, or the shorter Form LM-3, Labor Organization Annual Report, with the U.S. Department of Labor (DOL) can attach a copy of the completed DOL form to Form 990, or Form 990-EZ, to provide some of the information required by Form 990 or Form 990-EZ. This substitution is not permitted if the organization files a DOL report that consolidates its financial statements with those of one or more separate subsidiary organizations.

Employee benefit plans (section 501(c)(9), (17), or (18))

An employee benefit plan may be able to substitute Form 5500 for part of Form 990 or Form 990-EZ. The substitution can be made if the organization filing Form 990, or Form 990-EZ, and the plan filing Form 5500, meet all the following tests:

1. The Form 990, or Form 990-EZ, filer is organized under section 501(c)(9), (17), or (18);
2. The Form 990, or Form 990-EZ, filer and Form 5500 filer are identical for financial reporting purposes and have identical receipts, disbursements, assets, liabilities, and equity accounts;
3. The employee benefit plan does not include more than one section 501(c) organization, and the section 501(c) organization is not a part of more than one employee benefit plan;
4. The organization's accounting year and the employee plan year are the same. If they are not, you may want to change the organization's accounting year, as explained in General Instruction G, so it will coincide with the plan year.

Allowable substitution areas

Whether an organization files Form 990, or Form 990-EZ, for a labor organization or for an employee benefit plan, the areas of Form 990, or Form 990-EZ, for which other forms can be substituted are the same. These areas are:

Form 990

• Lines 13 through 15 of Part I (but complete lines 16 through 21);
• Part II; and
• Part IV (but complete lines 59, 66, and 74, columns (A) and (B)).

Form 990-EZ

• Lines 10 through 16 of Part I (but complete lines 17 through 21).
• Part II (but complete lines 25 through 27, columns (A) and (B)).

If an organization substitutes Form LM-2 or LM-3 for any of the Form 990, or Form 990-EZ, Parts or line items mentioned above, it must attach a reconciliation sheet to show the relationship between the amounts on the DOL forms and the amounts on Form 990 or Form 990-EZ. This is particularly true of the relationship of disbursements shown on the DOL forms and the total expenses on line 17, Part I, of both Form 990 and Form 990-EZ. The organization must make this reconciliation because the cash disbursements section of the DOL forms includes nonexpense items. If the organization substitutes Form LM-2, be sure to complete its separate schedule of expenses.

G. Accounting Periods and Methods

Note: For further information, see Pub. 538.

Accounting periods

Calendar year. Use the 2001 Form 990, or Form 990-EZ, to report on the 2001 calendar year accounting period. A calendar year accounting period begins on January 1 and ends on December 31.

Fiscal year. If the organization has established a fiscal year accounting period, use the 2001 Form 990, or Form 990-EZ, to report on the organization's fiscal year that began in 2001 and ended 12 months later. A fiscal year accounting period should normally coincide with the natural operating cycle of the organization. Be certain to indicate in the heading of Form 990, or Form 990-EZ, the date the organization's fiscal year began in 2001 and the date the fiscal year ended in the year 2002.

Short period. Use the 2001 Form 990, or Form 990-EZ, to report on a short accounting period (less than 12 months) that began in 2001 and ended November 30, 2002, or earlier.

Because the Form 990, or Form 990-EZ, for the year 2002 may not be distributed until the year 2003, use the prior year form, the 2001 Form 990, or Form 990-EZ, to report on a short accounting period that begins in the year 2002 and ends November 30, 2002, or earlier. Strike the 2001 year on the form and show the year 2002.

If the organization changes its accounting period, it must file a return on Form 990, or Form 990-EZ, for the short period resulting from the change. Write Change of Accounting Period at the top of this short-period return.

If the organization changed its accounting period within the 10-calendar-year period that includes the beginning of the short period, and it had a Form 990, or Form 990-EZ, filing requirement at any time during that 10-year period, it must also attach a Form 1128 to the short-period return. See Rev. Proc. 85-58, 1985-2 C.B. 740.

Group return. When affiliated organizations authorize their central organization to file a group return for them, the accounting period of the affiliated organizations and the central organization must be the same. See General Instruction R.

Accounting methods

Unless instructed otherwise, the organization should generally use the same accounting method on the return to figure revenue and expenses as it regularly uses to keep its books and records. To be acceptable for Form 990, or Form 990-EZ, reporting purposes, however, the method of accounting used must clearly reflect income.

Generally, the organization must file Form 3115 to change its accounting method. Notice 96-30, 1996-1 C.B. 378, provides relief from filing Form 3115 to section 501(c) organizations that change their methods of accounting to comply with the provisions of SFAS 116, Accounting for Contributions Received and Contributions Made. In SFAS 116, the Financial Accounting Standards Board revised certain generally accepted accounting principles relating to contributions received and contributions awarded by not-for-profit organizations.

A not-for-profit organization that changes its method of accounting for Federal income tax purposes to conform to the method provided in SFAS 116 should report any adjustment required by section 481(a) on line 20 of Form 990, or Form 990-EZ, as a net asset adjustment made during the year the change is made. The adjustment should be identified as the effect of changing to the method provided in SFAS 116. The beginning of year statement of financial position (balance sheet) should not be restated to reflect any prior period adjustments.

State reporting. If the organization prepares Form 990, or Form 990-EZ, for state reporting purposes, it may file an identical return with the IRS even though the return does not agree with the books of account, unless the way one or more items are reported on the state return conflicts with the instructions for preparing Form 990, or Form 990-EZ, for filing with the IRS.

Example 1. The organization maintains its books on the cash receipts and disbursements method of accounting but prepares a state return based on the accrual method. It could use that return for reporting to the IRS.

Example 2. A state reporting requirement requires the organization to report certain revenue, expense, or balance sheet items differently from the way it normally accounts for them on its books. A Form 990, or Form 990-EZ, prepared for that state is acceptable for the IRS reporting purposes if the state reporting requirement does not conflict with the Form 990, or Form 990-EZ, instructions.

An organization should keep a reconciliation of any differences between its books of account and the Form 990, or Form 990-EZ, that is filed.

Most states that accept Form 990, or Form 990-EZ, in place of their own forms require that all amounts be reported based on the accrual method of accounting. For further information, see General Instruction E.

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