Tag Archives: 990

IRS Expands Automatic Extension for Form 990

calendarFor as long as I can remember, nonprofits have been able to obtain a 3-month automatic extension for Form 990 filings simply by filing IRS Form 8868 before the initial due date.  The Form 990 filing due date is four months and fifteen days after the organization’s fiscal year-end (e.g., May 15 for calendar fiscal years, and November 15 for fiscal years ending June 30).  For an additional three-month extension, nonprofits have had to make a second filing – this time to ask permission for such additional extension and to demonstrate “reasonable cause”.  Further, since the penalties for late Form 990 filings can be quite onerous (measured on a per-day late basis), it was generally best to get the Form 990 filed by the initial due date or no later than the available automatic 3-month extension.

Under new rules to take effect starting with tax years that begin after December 31, 2015, the original extension will now be for 6 months automatically. Calendar year filers for 2016 who file a timely extension will automatically have until November 15 , 2016 to complete their 990.

This will be a welcome relief to many groups – and probably to the IRS as well.

How to Get Your ACA Tax Credit When You’re a Tax-exempt Organization

Zemanta Related Posts ThumbnailUnder the Affordable Care Act (ACA), a small employer can claim a portion of insurance premiums paid as a tax credit. But what do you do if you are a tax-exempt organization? Don’t worry! You can still claim the credit if your organization is eligible. Eligible tax-exempt organizations can claim up to 35% of premiums paid. The credit is available for eligible employers for two consecutive tax years.

An eligible tax-exempt organization would file a Form 990-T and fill in line 44F, Credit for Small Employer Health Insurance Premiums, and attach a Form 8941, Credit for Small Employer Health Insurance Premiums.

The tax-exempt organization can file a Form 990-T in order to request the credit even if there is no unrelated business income to report. Just follow the instructions located here and look for details for Line 44F.

According to the IRS, “to be eligible for the credit, an eligible small employer generally must pay premiums on behalf of employees enrolled in a qualified health plan offered through a Small Business Health Options Program (SHOP) Marketplace.”

To be eligible, you must meet three requirements:

  1. You paid premiums for employee health insurance coverage under a qualifying arrangement. This would generally be one that requires you to pay a uniform percentage of not less than 50% (with some exceptions for different tiers of coverage or list billing arrangements).
  2. You had fewer than 25 full-time employees for the year.
  3. You paid *average* annual wages per employee of less than $51,000.

The IRS has worksheets to help calculate this in the instructions for Form 8941.

For more information on business matters affecting nonprofit organizations, contact Aronson’s Nonprofit & Association Industry Services Group or Carol Barnard at 301.231.6200.

IRS Issues Draft Form 990 and Instructions for 2013

IRS sealA draft form and instructions for the 2013 Federal Form 990 have been issued by the IRS.  There are very minimal changes from the previous year’s form and instructions.   There is some clarification in the instructions for reporting short period returns and accounting method changes that are very helpful.   A link to the draft form and instructions is here:


Basic Nonprofit Accounting and Operations Boot Camp!

Join Maryland Nonprofits and Aronson LLC Partner Rob Eby on February 21st for an informative seminar that will answer many of the most commonly asked questions regarding nonprofit accounting and operations:

  • What are some indicators of fraud? 
  • Why is the 990 so important? 
  • How come these nonprofit statements look so different from for-profit statements I’m used to reading? 
  • Is my nonprofit required to have an A-133 audit? 
  • How do I implement internal controls with limited resources? 
  • What are contributions, exchange transactions and agency transactions, and how are they recorded as revenue? 
  • Is there anyone who can help decipher nonprofit accounting, reporting and best practices? 

This interactive discussion will address each of these questions and many more.  Click HERE to register today and reserve your spot!


MWAA: Local Board Policies Questioned During Public Upheaval

It must be tough to be a member of the board of directors for the Metropolitan Washington Airports Authority (MWAA) lately.  There are numerous headlines blasting insider deals and lax travel policies.  A former board member has gotten the boot after headlines ballyhooing how she obtained a full-time job with a salary of $180,000 a year to be an “advisor” with full benefits.  The airports authority is adopting stricter travel policies and spending policies in the wake of such embarrassing details as a $9,000 plus ticket for one board member to travel to Prague.  A stricter ethics policy is also being discussed by the board.   Link to the  NBC article:  http://www.nbcwashington.com/blogs/first-read-dmv/Airport-Authority-Setting-New-Rules-168596246.html

The Federal Form 990 informational return filed by most nonprofit organizations, which is open to public inspection, covers every area mentioned above.  Transactions with interested parties, conflict of interest polices, compensation of former board members are all revealed in the public return filed annually by nonprofit organizations.  Good governance suggests the entire board should review a Form 990 before it is filed with the IRS, and during such a process issues such as these come to light for the first time for many board members.   If the MWAA were a nonprofit organization required to file a Form 990, these shady deals and lax policies may have come to light for the board members much sooner, and possibly without all the headlines.

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