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Non Profit Treasurer: Ask Yourself These Questions Before Filing Your 990

If you’re a non profit treasurer, filing your 990 tax forms is one of many tasks you perform. 

You’re charged with managing and maintaining your organization’s financial wellbeing—no minor job.

Although your tasks as treasurer are many, filing your 990 tax forms may be one of the most important things you do each year.

Filing:

  • maintains your tax-exempt status as an organization
  • helps you avoid late fines and other penalties
  • provides a financial record for you and key stakeholders in your non profit

If you don’t file, or file late, you face potential fines that can hurt your nonprofit’s financial security. At best, getting behind means you’ll have to file for an extension prior to the date your tax forms are due.

Your tax forms are due the 15th day of the 5th month after the last month that concludes your fiscal tax year.

If you don’t file for three consecutive years, you automatically lose tax-exempt status—and getting it back is time consuming and not a guarantee.  

You may also lose the confidence of donors, investors, volunteers, and other stakeholders.

To avoid these costly consequences, we believe the best approach is to build 990 tax filing preparation into your financial planning and operations.

If you’re a Non Profit Treasurer: Ask Yourself These Questions Before Filing Your 990.

Have I Kept Good Financial Records? Is Everything in Order?

Keeping records is step one of preparing for your tax filings. It’s important to keep accurate and up-to-date records, as board members, donors, and grant-makers will need to have ready access to those reports.

At times, these documents impact whether someone is willing to offer funding to your nonprofit and bestow trust and transparency to the public.

Here are a few important steps you can take to get things in order and prepare for your 990 filing:

  • Practice consistent and effective record-keeping habits.
  • Keep a thorough calendar of important dates and filing deadlines.
  • Conduct at minimum an annual audit. Go over it thoroughly with key board members.
  • Work ahead of the 990 tax form filing deadline. The extra burden is still less than filing late.
  • Create a backup plan for the board to file in case of an unforeseen illness or emergency.

Is My Team on Board?

As with any non profit endeavor, financial management success only happens if the whole team is on the same page and working together.

While the treasurer is ultimately responsible for keeping records, managing banking and other financial transactions, and filing 990 tax forms, it’s crucial that they keep other members informed, educated, and engaged.

 Here’s how to get your board prepared:

  • Spend time throughout the year educating board members on (among other topics) the state of your finances and important financial ratios, current trends in the nonprofit industry, and key concepts of 990 filing.
  • Meet with board members about major financial management tasks such as your annual audit.
  • Once your 990 is complete, run it by other board members and, if necessary, your finance committee for approval.

As your 990 is a crucial financial document that impacts your organization from top to bottom, maintains your tax-exempt status, and must be accurate and transparent, having your whole team informed and on board is a major key to your success.

Am I Ready to File My 990?

If you’ve kept good records and cleared the information with your board, you’re well on your way to a successful 990 filing.

The next steps are ensuring you are eligible to file, and filing the right form.

Am I Eligible to File a 990?

For most 501 c 3s and other mainstream charitable organizations, the answer is yes. You’ll know this because you filed and were approved for tax-exempt status using the 1023 form. You also took the steps to incorporate your non profit.

Have you ever been late for filing your 990 forms in the past or had your tax-exempt status revoked by the IRS? If so, did you go through the process to get reinstated? Are you sure you’re tax exempt?

You can check if you’re listed as tax exempt using the IRS Tax Exempt Organization Search.

You should also check the status and requirements for nonprofit filing in your state.

Am I Filing the Right Form?

The form you file will depend on your organization’s financial status and other factors. Here are some of the most common forms you’re likely to file.

Form 990: for eligible tax-exempt nonprofits with gross receipts greater than or equal to $200,000 or (2) total assets greater than or equal to $500,000 at the end of the tax year.

Form 990-EZ: for eligible tax-exempt nonprofits with gross receipts less than $200,000 and total assets at the end of the tax year less than $500,000.

Form 990-N (e-Postcard): for eligible tax-exempt nonprofits with annual gross receipts $50,000 or less.

Form 990-PF: for private foundations, either taxable or tax-exempt, as well as non-exempt charitable trusts treated as private foundations under U.S. tax code.

See a full breakdown of online 990 tax forms here.

For multi-chapter nonprofits, it’s also important to consider the filing requirements for each chapter or component, who’s required to file on their behalf, and what their filing deadlines are.

Have I Considered Hiring a 990 e-Filer?

Needless to say, there’s a lot to consider. What if some of that burden could be taken off your back? What if we told you that online nonprofit tax specialists could help?

That’s exactly the service that certified nonprofit tax e-Filer File 990 provides.

Having a trustworthy, easy, consistent electronic filing option can make a world of difference for your nonprofit’s financial officer come tax season.

Here’s how File 990’s services will help your nonprofit:

  • secure annual e-filing for 990-EZ and 990-N forms
  • automated reminders when it’s time to file
  • storage of data from previous years, to make filing easier
  • optional enterprise suite to track and remind your multiple components or chapters to file
  • a group filing option for 990-N forms.

Have questions about your 990 filing or want to learn more about our e-filing services? Call us at (859) 309-3641 or email info@file990.org.