Never Miss This Form Again!

By Raul Rivera

Every year thousands of nonprofit organizations, including ministries, are required to file an annual information return to the IRS via Form 990.

The IRS uses this form to help ensure tax-exempt organizations are continuously complying with the tax law in order to remain tax-exempt. 

Form 990 specifically requires financial information from your ministry to help the IRS determine whether you are continually meeting its financial support requirements, not operating for private benefits of individuals within the ministry, and remaining organized for charitable purposes that allow your ministry to maintain its tax-exempt status.

With that being said, failure to file Form 990 can result in hefty penalties and unfavorable consequences.

For instance, if your ministry fails to file its Form 990 for three consecutive years, the result will be the loss of your ministry’s tax-exempt status.

Since the repercussions of failing to file your ministry’s Form 990 can be so dire, I want to provide you with some tips on how you can make sure your ministry never misses another Form 990 filing.

But first, I want to clear the air in regard to churches and the Form 990 filing requirement.

Are churches required to file Form 990?

At our conferences, pastors often ask if their churches are supposed to file a Form 990 tax return.

The short answer in NO. (If you are a pastor or church leader, click here to read about the forms that are applicable to churches.)

Section 6033(a)(3)(A)(i) exempts churches, their integrated auxiliaries, and conventions of churches from filing Form 990. 

The Freedom From Religion Foundation filed a lawsuit claiming that the tax code gave churches preferential treatment, thus constituting “discrimination on the basis of religion in violation of the Establishment Clause.” 

However, because of a previous Supreme Court ruling, the case was dismissed.

For now, while all other nonprofit organizations must file a Form 990 annually, churches do NOT have to file an annual Form 990 with the IRS.

(Recommended reading: “Does a Church Need to be 501(c)(3) Approved?”)

4 steps you can take to file your ministry’s Form 990 on time

You do not have to be taken by surprise when it comes to filing Form 990. If filing Form 990 is new to your ministry, or if you have done it for years, there are some steps that you can implement in order to ensure a timely filing of your ministry’s Form 990. 

Let us take a look at the steps below.

Step 1: Determine if your organization is required to file Form 990

Remember, churches do NOT have to file 990 tax returns.

All other 501(c)(3) organizations, and other tax-exempt entities, however, are required to file whether they are religious or not.

Private foundations are always required to file a Form 990 specifically for private foundations no matter how much they receive in donations. 

Step 2: Create a calendar reminder

Create an annual calendar reminder to notify your staff of the Form 990 filing due date.

Be sure to add this to your organization’s corporate business calendar to ensure that it is not overlooked in the midst of other corporate activities. 

If you are a church and you operate a ministry that is its own entity (i.e., a community development corporation), then it will also do you well to add a reminder to the church’s corporate calendar.

Step 3: Determine what type of Form 990 you are responsible for filing

There are several variations of the Form 990 annual informational return. They are listed below.

• 990-N (the e-Postcard): A 990-N is an electronic notice. Organizations with gross receipts of normally $50,000 or less will file this electronic notice. 
• Form 990-EZ: Form 990-EZ is also referred to as the short form. Organizations with gross receipts of normally more than $50,000 but less than $200,000, and whose assets are valued at less than $500,000, are required to file this form. 
• Form 990: Form 990 is also known as the long form. Organizations whose gross receipts are on average $200,000 or greater, or whose assets are valued at $500,000 or greater, are required to file Form 990. 
• Form 990-PF: All private foundations are required to file Form 990-PF. 
• Form 990-T: All nonprofits, including churches, must file a 990-T if they have unrelated business income (UBI). UBI is income generated from conducting an activity unrelated to the organization’s tax-exempt purpose. 

Step 4: File your Form 990 by the appropriate deadline

All 990 filers are required to submit their returns by the 15th day of the 5th month of their fiscal year. For instance, if your fiscal year coincides with the calendar year ending on December 31st, then you are required to file Form 990 by May 15th of the next year. 

However, if your fiscal year happens to end on June 30th, then you are required to file Form 990 by November 15th of the same year. 

Never miss another Form 990 filing

The administrative tasks of running and operating your ministry’s nonprofit may, at times, feel overwhelming. However, it does not have to be that way.

With the assistance of our highly trained staff, we can help to ensure that you are filing the correct Form 990 for your organization in a timely manner.

For more information, please give our office a call today at 877-494-4655! We are honored to assist you!

Recommended blogs for you:

• “Does the Tax Reform Affect Ministers Taxes?”
• “3 Ways Ministers Can Make the Most of Their Taxes”
• “IRS Denies a $65 Million Charitable Tax Deduction”

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