FYI: Going Paperless - Updates on IRS 1023 and 990 Filings
The Internal Revenue Service (IRS) is going paperless for many crucial document filings for tax-exempt organizations. That includes the Form 1023 Application for Recognition of Exemption that are filed for organizations to become (501)(c)(3) charitable organization and the annual reporting requirements of Form(s) 990. Here's what you need to know: Form 1023 Revisions and Required Electronic Submission Effective January 31, 2020, applications for recognition of exemption on Form 1023 must be submitted electronically to the IRS at www.pay.gov. The IRS is providing a 90-day grace period during which it will continue to accept paper versions of Form 1023 until April 30, 2020. The user fee for Form 1023 will remain $600 for 2020. 990's & E-Filing What is the IRS form 990? Form 990 is the IRS' primary tool for gathering information about tax-exempt organizations, educating organizations about tax law requirements and promoting compliance. Organizations also use the Form 990 to share information with the public about their programs. Additionally, most states rely on the Form 990 to perform charitable and other regulatory oversight and to satisfy state income tax filing requirements for organizations claiming exemption from state income tax. A tax-exempt organization must file an annual information return or notice with the IRS, unless an exception applies. Annual information returns include Form 990, Form 990-EZ and Form 990-PF. Form 990-N (e-Postcard) is also an annual notice. Form 990-EZ can be filed by organizations with gross receipts of less than $200,000 and total assets of less than $500,000 at the end of their tax year. Form 990 must be filed by organizations with gross receipts greater than $200,000 and total assets of more than $500,000 at the end of their tax year. Small tax-exempt organizations whose annual gross receipts are normally $50,000 or less can satisfy their annual reporting requirement by electronically submitting Form 990-N. The IRS is now requiring electronic filing by exempt organizations. Returns must be filed electronically by exempt organizations for tax years beginning on or after July 2, 2019. The IRS has stated however, a grace period of electronic filing transition relief. While the IRS encourages all organizations to file electronically, the agency will continue to accept Form 990-EZ returns filed on paper for any tax year beginning before July 2, 2020. If you are filing Form 990 for a tax year beginning on or after July 2, 2019, you must file the return electronically. There are very few exceptions to this new requirement. Required electronic filing for calendar year filers will apply for tax years beginning in 2020 and later. Form 990-PF is filed by private foundations regardless of financial status. 990 Due Dates It's tax season but when your education foundation's annual filing (Form 990 or 990-EZ) is due varies based on the end of your fiscal year. Your filing is due by the middle of the fifth month after the end of your fiscal year. For example, if your fiscal year ended on December 31st, your 990 filing is due by May 15, 2020. The IRS has provided a helpful table for filing deadlines and you can check it out here. If your organization needs assistance with the creation of the 1023 Application or filing of your 990, please contact Foundation Innovation about our services at firstname.lastname@example.org or (512) 535-2046.