Enter salary, fees, bonuses, and severance payments received by each listed employee. Include current year payments of amounts reported or reportable as deferred compensation in any prior year.

Include in column (d) all forms of deferred compensation and future severance payments (whether or not funded, whether or not vested, and whether or not the deferred compensation plan is a qualified plan under section 401(a)). Include in this column payments to welfare benefit plans on behalf of the employee. Such plans provide benefits such as medical, dental, life insurance, severance pay, disability, etc. Reasonable estimates may be used if precise cost figures are not readily available.

Unless the amounts are reported in column (c), report as deferred compensation in column (d), salaries and other compensation earned during the period covered by the return, but not yet paid by the date the organization files its return.

Enter in column (e) both taxable and nontaxable fringe benefits (other than de minimis fringe benefits described in section 132(e)). Include expense allowances or reimbursements that the recipients must report as income on their separate income tax returns. Examples include:

See Pub. 525, Taxable and Nontaxable Income, for more information.

Line 1.   If you checked “Yes” on this line, you must complete Part VI-A or VI-B and provide the required additional information; otherwise, the return may be considered incomplete.

  Enter the total expenses paid or incurred in connection with the lobbying activities described on line 1. The amount of expenses you enter should equal the amounts on line 38, Part VI-A, or line i, Part VI-B. If columns (a) and (b) of line 38 are both completed, enter both amounts separately.

Line 2.   See Part IV, Definitions, for the meaning of the term “family member.”

Lines 2a through 2e   apply to both sides of a listed transaction. Reporting is required, for example, whether the exempt organization is a payer or payee, buyer or seller, lender or borrower.

Line 2d. Compensation or Repayment.   If the only compensation or repayment relates to amounts the organization reported in Part V of Form 990, or Part IV of Form 990-EZ, check “Yes” and write “See Part V, Form 990,” or “See Part IV of Form 990-EZ,” on the dotted line to the left of the entry space.

Line 3a. Scholarships, etc.   The term “qualify” in line 3a means that organizations or individuals will use the funds the organization provides for charitable purposes described in sections 170(c)(1) and 170(c)(2).

  The term “qualify” also means that individual recipients belong to a charitable class and the payments are to aid them. Examples include:

Line 3b. Section 403(b) Annuity Plan.   Indicate whether you have a section 403(b) annuity plan available for your employees.

Line 4.   Check “Yes” to Line 4 if the organization maintained separate accounts for any participating donor during the tax year even though the donor did not make a contribution for that year or the donor has not exercised his or her right to make a suggestion on the charitable use of funds in the account or its distribution for charity.

  Community foundations may maintain separate accounts for participating donors within the meaning of this question.

The following terms are used in more than one item in Part IV. The definitions given below generally apply.

Lines 15, 16, 17, 26, and 27.   See
Part IV, Definitions. See also Regulations section 1.509(a)-3 for the:

Line 17. Gross Receipts From Activities Related to Organization's Charitable, etc., Purpose.   Include income generated by the organization's exempt function activities (charitable, educational, etc.) and by its nontaxable fundraising events (excluding any contributions received, which are reported on line 15).

  Examples include income from:

Line 26b. Contributions in Excess of the 2% Limitation.   Prepare a list for your files to show the name of and amount contributed by each person (other than a governmental unit or publicly supported organization) whose total gifts for 1999 through 2002 exceeded the amount shown in line 26a. (Do not file this list with your return.) Enter the total of all these excess amounts on line 26b. An example of such a list for line 26b is given below.

Line 27a. Contributions, Membership Fees, and Gross Receipts From Disqualified Persons.   For amounts included in lines 15, 16, and 17 that were received from a “disqualified person,” prepare a list for your records to show the name of, and total amounts received in each year from each “disqualified person.” (Do not file this list with your return.) Enter the sum of such amounts for each year. An example of such a list for line 27a is given below.

Line 27b. Gross Receipts From Other Than Disqualified Persons.   For any amount included in line 17 that was received from each person (other than “disqualified persons”) prepare a list for your records to show the name of, and amount received for each year, that was more than the larger of: After computing the difference between the amount received and the larger amount described in 1 or 2, enter the sum of these differences (the excess amounts) for each year. An example of such a list for line 27b is given below for the year 2002 entry line. Prepare similar lists to determine excess amounts for the other entry lines of 27b. (Do not file these lists with your return.)

Line 28. Unusual Grants.   Unusual grants generally are substantial contributions and bequests from disinterested persons and are—

  A grant that meets these terms may be treated as an unusual grant (that is disregarded entirely in the public support computation) even if the organization receives the funds over a period of years. In the list of unusual grants, show only what the organization received during the year.

  Do not treat gross investment income items as unusual grants. Instead, include all investment income in support.

  See Rev. Rul. 76-440, 1976-2 C.B. 58 and Regulations sections 1.170A-9(e)(6)(ii) and 1.509(a)-3(c)(3) and (4) for details about unusual grants.

  For an organization described in lines 10, 11, or 12 that received any unusual grants during 1999 through 2002, prepare a list for your records to show, for each year, the name of the contributor, the date and amount of the grant, and a brief description of the grant. (Do not file this list with your return.) Do not include these grants in line 15. An example for such a list for line 28 is given below.

4.01 Organizational requirements.   A school must include a statement in its charter, bylaws, or other governing instrument, or in a resolution of its governing body, that it has a racially nondiscriminatory policy as to students and therefore does not discriminate against applicants and students on the basis of race, color, and national or ethnic origin.

4.02 Statement of policy.   Every school must include a statement of its racially nondiscriminatory policy as to students in all its brochures and catalogues dealing with student admissions, programs, and scholarships. A statement substantially similar to the Notice described in paragraph (a) of subsection 1 of section 4.03, infra, will be acceptable for this purpose. Further, every school must include a reference to its racially nondiscriminatory policy in other written advertising that it uses as a means of informing prospective students of its programs. The following references will be acceptable:

  The (name) school admits students of any race, color, and national or ethnic origin.

4.03 Publicity.   The school must make its racially nondiscriminatory policy known to all segments of the general community served by the school.

  1. The school must use one of the following two methods to satisfy this requirement:

  (a) The school may publish a notice of its racially nondiscriminatory policy in a newspaper of general circulation that serves all racial segments of the community. This publication must be repeated at least once annually during the period of the school's solicitation for students or, in the absence of a solicitation program, during the school's registration period. Where more than one community is served by a school, the school may publish its notice in those newspapers that are reasonably likely to be read by all racial segments of the communities that it serves. The notice must appear in a section of the newspaper likely to be read by prospective students and their families and it must occupy at least three column inches. It must be captioned in at least 12 point boldface type as a notice of nondiscriminatory policy as to students, and its text must be printed in at least 8 point type. The following notice will be acceptable:

  (b) The school may use the broadcast media to publicize its racially nondiscriminatory policy if this use makes such nondiscriminatory policy known to all segments of the general community the school serves. If this method is chosen, the school must provide documentation that the means by which this policy was communicated to all segments of the general community was reasonably expected to be effective. In this case, appropriate documentation would include copies of the tapes or script used and records showing that there was an adequate number of announcements, that they were made during hours when the announcements were likely to be communicated to all segments of the general community, that they were of sufficient duration to convey the message clearly, and that they were broadcast on radio or television stations likely to be listened to by substantial numbers of members of all racial segments of the general community. Announcements must be made during the period of the school's solicitation for students or, in the absence of a solicitation program, during the school's registration period.

  Communication of a racially nondiscriminatory policy as to students by a school to leaders of racial groups as the sole means of publicity generally will not be considered effective to make the policy known to all segments of the community.

  2. The requirements of subsection 1 of this section will not apply when one of the following paragraphs applies:

  (a) If for the preceding 3 years the enrollment of a parochial or other church-related school consists of students at least 75% of whom are members of the sponsoring religious denomination or unit, the school may make known its racially nondiscriminatory policy in whatever newspapers or circulars the religious denomination or unit utilizes in the communities from which the students are drawn. These newspapers and circulars may be those distributed by a particular religious denomination or unit or by an association that represents a number of religious organizations of the same denomination. If, however, the school advertises in newspapers of general circulation in the community or communities from which its students are drawn and paragraphs (b) and (c) of this subsection are not applicable to it, then it must comply with paragraph (a) of subsection 1 of this section.

  (b) If a school customarily draws a substantial percentage of its students nationwide or worldwide or from a large geographic section or sections of the United States and follows a racially nondiscriminatory policy as to students, the publicity requirement may be satisfied by complying with section 4.02, supra. Such a school may demonstrate that it follows a racially nondiscriminatory policy within the meaning of the preceding sentence either by showing that it currently enrolls students of racial minority groups in meaningful numbers or, when minority students are not enrolled in meaningful numbers, that its promotional activities and recruiting efforts in each geographic area were reasonably designed to inform students of all racial segments in the general communities within the area of the availability of the school. The question whether a school satisfies the preceding sentence will be determined on the basis of the facts and circumstances of each case.

  (c) If a school customarily draws its students from local communities and follows a racially nondiscriminatory policy as to students, the publicity requirement may be satisfied by complying with section 4.02, supra. Such a school may demonstrate that it follows a racially nondiscriminatory policy within the meaning of the preceding sentence by showing that it currently enrolls students of racial minority groups in meaningful numbers. The question whether a school satisfies the preceding sentence will be determined on the basis of the facts and circumstances of each case. One of the facts and circumstances that the Service will consider is whether the school's promotional activities and recruiting efforts in each area were reasonably designed to inform students of all racial segments in the general communities within the area of the availability of the school. The Service recognizes that the failure by a school drawing its students from local communities to enroll racial minority group students may not necessarily indicate the absence of a racially nondiscriminatory policy as to students when there are relatively few or no such students in these communities. Actual enrollment is, however, a meaningful indication of a racially nondiscriminatory policy in a community in which a public school or schools became subject to a desegregation order of a federal court or otherwise expressly became obligated to implement a desegregation plan under the terms of any written contract or other commitment to which any Federal agency was a party.

  The Service encourages schools to satisfy the publicity requirement by the methods described in subsection 1 of this section, regardless of whether a school considers itself within subsection 2, because it believes these methods to be the most effective to make known a school's racially nondiscriminatory policy. In this regard it is each school's responsibility to determine whether paragraph (a), (b), or (c) of subsection 2 applies to it. On audit, a school must be prepared to demonstrate that the failure to publish its racially nondiscriminatory policy in accordance with subsection 1 of this section was justified by the application to it of paragraph (a), (b), or (c) of subsection 2. Further, a school must be prepared to demonstrate that it has publicly disavowed or repudiated any statements purported to have been made on its behalf (after November 6, 1975) that are contrary to its publicity of a racially nondiscriminatory policy as to students, to the extent that the school or its principal official were aware of such statements.

4.04 Facilities and programs.   A school must be able to show that all of its programs and facilities are operated in a racially nondiscriminatory manner.

4.05 Scholarship and loan programs.   As a general rule, all scholarship or other comparable benefits procurable for use at any given school must be offered on a racially nondiscriminatory basis. Their availability on this basis must be known throughout the general community being served by the school and should be referred to in the publicity required by this section in order for that school to be considered racially nondiscriminatory as to students. . . . [S]cholarships and loans that are made pursuant to financial assistance programs favoring members of one or more racial minority groups that are designed to promote a school's racially nondiscriminatory policy will not adversely affect the school's exempt status. Financial assistance programs favoring members of one or more racial groups that do not significantly derogate from the school's racially nondiscriminatory policy similarly will not adversely affect the school's exempt status.

4.06 Certification.   An individual authorized to take official action on behalf of a school that claims to be racially nondiscriminatory as to students is required to certify annually, under penalties of perjury, that to the best of his or her knowledge and belief the school has satisfied the applicable requirements of sections 4.01 through 4.05 of the Rev. Proc. This certification is line 35 in Part V.

4.07 Faculty and staff.   The existence of a racially discriminatory policy with respect to employment of faculty and administrative staff is indicative of a racially discriminatory policy as to students. Conversely, the absence of racial discrimination in employment of faculty and administrative staff is indicative of a racially nondiscriminatory policy as to students.

7.01 Specific records.    Except as provided in section 7.03, each exempt private school must maintain for a minimum period of three years, beginning with the year after the year of compilation or acquisition, the following records for the use of the Service on proper request:

7.02 Limitation.   

7.03 Exceptions.   The records described in section 7.01 need not be independently maintained for Internal Revenue Service use if:

7.04 Failure to maintain records.   Failure to maintain or to produce upon the proper request the required records and information will create a presumption that the organization has failed to comply with these guidelines.

Expenditure test.   Under the “expenditure test,” there are limits both upon the amount of the organization's grassroots lobbying expenditures and upon the total amount of its direct lobbying and grassroots lobbying expenditures. If the electing public charity does not meet this “expenditure test,” it will owe a section 4911 excise tax on its excess lobbying expenditures. Moreover, if over a 4-year averaging period the organization's average annual total lobbying or grassroots lobbying expenditures are more than 150% of its dollar limits, the organization will lose its exempt status.

Exempt purpose expenditures.   The amount an electing public charity may spend on lobbying (without incurring tax) is a scaled percentage of the organization's exempt purpose expenditures. In general, an expenditure is an exempt purpose expenditure if it is paid or incurred by an electing public charity to accomplish the organization's exempt purpose.

  In general, exempt purpose expenditures are:

  See also Regulations section 56.4911-4(c) for a discussion of excluded expenditures.

Lobbying expenditures.   The term “lobbying expenditures” means expenditures paid or incurred for the purpose of attempting to influence legislation:

  To determine if an organization has spent excessive amounts on lobbying, you must know which expenditures are lobbying expenditures and which are not lobbying expenditures. An electing public charity's lobbying expenditures for a year are the sum of its expenditures during that year for (1) direct lobbying communications (“direct lobbying expenditures”) plus (2) grassroots lobbying communications (“grassroots expenditures”).

Direct lobbying communications (“direct lobbying expenditures”).   A direct lobbying communication is any attempt to influence any legislation through communication with any:

  A communication with a legislator or government official will be treated as a direct lobbying communication, if, but only if, the communication:

Grassroots lobbying communications (“grassroots expenditures”).   A grassroots lobbying communication is any attempt to influence any legislation through an attempt to affect the opinions of the general public or any part of the general public.

  A communication is generally not a grassroots lobbying communication unless (in addition to referring to specific legislation and reflecting a view on that legislation) it encourages recipients to take action about the specific legislation.

  A communication encourages a recipient to take action when it:

(1) States that the recipient should contact legislators;

(2) States a legislator's address, phone number, etc.;

(3) Provides a petition, tear-off postcard, or similar material for the recipient to send to a legislator; or

(4) Specifically identifies one or more legislators who:

  A communication described in (4) above generally is grassroots lobbying only if, in addition to referring to and reflecting a view on specific legislation, it is a communication that cannot meet the “full and fair exposition” test as nonpartisan analysis, study, or research.

  

Communication with members.   For purposes of section 4911, expenditures for certain communications between an organization and its members are treated more leniently than are communications to nonmembers. Expenditures for a communication that refers to, and reflects a view on, specific legislation are not lobbying expenditures if the communication satisfies the following requirements:

  Expenditures for a communication directed only to members that refers to, and reflects a view on, specific legislation and that satisfies the requirements of paragraphs 1, 2, and 4, but does not satisfy the requirements of paragraph 3, are treated as expenditures for direct lobbying.

  Expenditures for a communication directed only to members that refers to, and reflects a view on, specific legislation and satisfies the requirements of paragraphs 1 and 2, but does not satisfy the requirements of paragraph 4, are treated as grassroots expenditures, whether or not the communication satisfies the requirements of paragraph 3.

  See Regulations section 56.4911-5 for details.

  There are special rules regarding certain paid mass media advertisements about highly publicized legislation; allocation of mixed purpose expenditures; certain transfers treated as lobbying expenditures and special rules regarding lobbying on referenda, ballot initiatives, and similar procedures (see Regulations sections 56.4911-2 and -3).

Legislation.   In general, the term “legislation” includes Acts, bills, resolutions, or similar items. “Specific legislation” includes both legislation that has already been introduced in a legislative body and a specific legislative proposal that the organization either supports or opposes.

Exceptions to the definitions of direct lobbying communication and/or grassroots lobbying communication.   In general, engaging in nonpartisan analysis, study, or research and making its results available to the general public or segment or members thereof, or to governmental bodies, officials, or employees is not considered either a direct lobbying communication or a grassroots lobbying communication. Nonpartisan analysis, study, or research may advocate a particular position or viewpoint as long as there is a sufficiently full and fair exposition of the pertinent facts to enable the public or an individual to form an independent opinion or conclusion.

  A communication that responds to a governmental body's or committee's written request for technical advice is not a direct lobbying communication.

  A communication is not a direct lobbying communication if the communication is an appearance before, or communication with, any legislative body whose action might affect the organization's existence, its powers and duties, its tax-exempt status, or the deductibility of contributions to the organization, as opposed to affecting merely the scope of the organization's future activities.

Affiliated groups.   Treat members of an affiliated group as a single organization to measure lobbying expenditures and permitted lobbying expenditures.

  Two organizations are affiliated if one is bound by the other organization's decisions on legislative issues (control) or if enough representatives of one belong to the other organization's governing board to cause or prevent action on legislative issues (interlocking directorate).

  If you are not sure whether your group is affiliated, you may ask the IRS for a ruling letter. There is a fee for this ruling. Send the request to:

  Members of an affiliated group measure both lobbying expenditures and permitted lobbying expenditures on the basis of the affiliated group's tax year. If all members of the affiliated group have the same tax year, that year is the tax year of the affiliated group.

  However, if the affiliated group's members have different tax years, the tax year of the affiliated group is the calendar year, unless all the members of the group elect otherwise. See Regulations section 56.4911-7(e)(3).

  If the electing organization belongs to an affiliated group, complete in Part VI-A, lines 36 through 44:

  If there are no excess lobbying expenditures on either line 43 or 44 of column (a), treat each electing member as having no excess lobbying expenditures.

  However, if there are excess lobbying expenditures on either line 43 or 44 of column (a), treat each electing member as having excess lobbying expenditures. In such case, each electing member must file Form 4720, Return of Certain Excise Taxes on Charities and Other Persons Under Chapters 41 and 42 of the Internal Revenue Code , and must pay the tax on its proportionate share of the affiliated group's excess lobbying expenditures.

  To find a member's proportionate share, see Regulations section 56.4911-8(d). Enter the proportionate share in column (b) on line 43 or line 44, or on both lines.

Line 51. Reporting of certain transfers and transactions.   Except as provided below, report on line 51 any transfer to or transaction with a noncharitable exempt organization even if the transfer or transaction constitutes the only connection with the noncharitable exempt organization.

Line 51a. Transfers.   Answer “Yes” to lines 51a(i) and 51a(ii) if the reporting organization made any direct or indirect transfers of any value to a noncharitable exempt organization.

  A “transfer” is any transaction or arrangement whereby one organization transfers something of value (cash, other assets, services, use of property, etc.) to another organization without receiving something of more than nominal value in return. Contributions, gifts, and grants are examples of transfers.

  If the only transfers between the two organizations were contributions and grants made by the noncharitable exempt organization to the reporting organization, answer “No.”

Line 51b. Other transactions.   Answer “Yes” for any transaction described in lines 51b(i) through (vi), regardless of its amount, if it is with a related or affiliated organization.

Exception.   If a transaction with an unrelated noncharitable exempt organization was for adequate consideration and the amount involved was $500 or less, it is not necessary to answer “Yes” for that transaction.

Line 51b(iii).   Answer “Yes” for transactions in which the reporting organization was either the lessor or the lessee.

Line 51b(iv).   Answer “Yes” if either organization reimbursed expenses incurred by the other.

Line 51b(v).   Answer “Yes” if either organization made loans to the other or if the reporting organization guaranteed the other's loans.

Line 51b(vi).   Answer “Yes” if either organization performed services or membership or fundraising solicitations for the other.

Line 51c.   Complete line 51c regardless of whether the noncharitable exempt organization is related to or closely affiliated with the reporting organization. For the purposes of this line, “facilities” includes office space and any other land, building, or structure whether owned or leased by, or provided free of charge to, the reporting organization or the noncharitable exempt organization.

Line 51d.   Use this schedule to describe the transfers and transactions for which you entered “Yes” on lines 51a through 51c above. You must describe each transfer or transaction for which you answered “Yes.” You may combine all of the cash transfers (line 51a(i)) to each organization into a single entry. Otherwise, make a separate entry for each transfer or transaction.

Line 52. Reporting of certain relationships.   Enter on line 52 each noncharitable exempt organization to or with which the reporting organization is related, or affiliated, as defined above. If the control factor or the historic and continuing relationship factor (or both) is present at any time during the year, you must identify the organization on line 52 even if neither factor is present at the end of the year.

  Do not enter unrelated noncharitable exempt organizations on line 52 even if you report transfers to or transactions with those organizations on line 51. For example, if you reported a one-time transfer to an unrelated noncharitable exempt organization on line 51a(ii), you should not list the organization on line 52.