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Good day, ladies and gentlemen, and welcome to the IRS webcast on file error-free forms, form 990 series return. At this time it is my pleasure to turn the floor over to your host.

Welcome to this presentation, file error-free forms 990. We have a few announcements before we get started. The information contained in this presentation is current as of the day it was presented and shouldn't be considered official guidance. No identification with actual persons, living or deceased, places, buildings and products is intended or should be inferred.

This program is being recorded and will be maintained under federal recordkeeping laws. Now let's get started. Every year, most tax-exempt organizations must file a return in the Form 990-series to satisfy their IRS filing requirement. The return, open to public inspection, also shows how the organization continues to qualify for tax-exempt status. But sometimes organizations submit returns that aren't complete or not correct for their type of organization.

When that happens, the IRS rejects the return and sends it back to the organization for correction and refiling. Until the IRS accepts the return, the organization's filing requirement remains unmet. This could result in penalties or other consequences. In the next few minutes, I'll provide tips on how to ensure your organization is filing a correct, complete Form 990-series return. You may wonder, especially if you are a new organization, how to know your annual filing requirement. It's simple. After reviewing and approving your application for exemption, we sent a letter recognizing your organization as tax exempt. We call this your determination letter, and it's the first place to look for information about your filing requirement. The top right section of this sample letter to a new 501(c)(3)

organization shows several informational items. One is whether your organization is required to file a Form 990, 990 EZ, or 990 N. If this box is marked yes, you have an annual filing requirement. Not all organizations have an annual filing requirement. If your organization doesn't, this section will be marked "no," but note, if the determination letter has a date before 2007, information about the filing requirement might not reflect the current law. If your organization has a filing requirement, you must figure out which of those form 990 returns your organization is eligible to file. If you file one you're not eligible to use, it won't meet your filing requirement. We'll send the form back and ask you to submit the right one. First, let's consider private foundations. Every private foundation satisfies its filing requirement with Form 990-PF. This is true regardless of whether it has revenues and regardless of its activities. Second, all other exempt organizations with a filing requirement can satisfy their filing requirement by submitting a complete Form 990. Form 990 is the longest and most complex of the three forms I mentioned earlier, so if you're eligible to file one of the other two, you might consider doing so. You are eligible to file Form 990-EZ if for the year you are filing your gross receipts are less than $2,000 and your total assets at the end of the year are less than $500,000. Form 990-EZ is shorter and simpler than Form 990, but if your organization exceeds either of those thresholds, you must file Form 990.

Form 990-N, which we also call the e-postcard is just an annual gross receipts test. Your organization's annual gross receipts must normally be $50,000 or less to file Form 990-N. Form 990-N is formally known as a notice, rather than a return, but it still satisfies your filing requirement if your organization is eligible to file it.

And note, a supporting organization can't file a Form 990-N. A supporting organization is a type of a charity that carries out its exempt purposes by supporting other exempt organizations, usually other public charities, and it must file a Form 990 or a 990-EZ. By the way, gross receipts are defined as the total amounts an organization received from all resources during its annual tax year, without subtracting any costs or expenses. And be careful not to incorrectly deduct amounts when determining your gross receipts. For example, if you brought in $50,000 from a special fundraiser but incurred $10,000 in expenses in putting the fundraiser on, you would still count the entire $50,000 as part of your gross receipts, not just the $40,000 net revenue from the event. For details on how to figure your organization's gross receipts, see appendix B of the instructions for Form 990. So you've taken a look at your organization's determination letter and figured out which Form 990 series return you can file.

What are some other items you need to watch out for to help make sure you're filing a complete return that the IRS will accept? If you're filing a paper return, make sure the return is properly signed. It must be signed by the current president, vice president, treasurer, assistant treasurer, chief accounting officer, or other corporate officer, such as a tax officer, who is authorized to sign as of the date the return is filed. If you pay a tax practitioner to prepare your return, the practitioner will sign it as well, but that doesn't substitute for the signature of one of the officers I just listed. Another big reason the IRS rejects and sends back returns is missing schedules. All 501(c)(3) organizations that file either a Form 990 or 990-EZ must submit a schedule A, public charity status and public support to report its public charity status and show its public support. If you're a small 501(c)(3) organization filing a Form 990-N, you don't have to file a schedule A.

Another common missing item is schedule B, schedule of contributors. The general rule for schedule B states that an organization filing Form 990, 990-EZ, or 990-PF that received during the year contributions totaling $5,000 or more in money or property from any one contributor must file schedule B. However, three special rules augment the general rule, so take a look at the instructions to determine whether your organization needs to file schedule B.

501(c)(3) organizations must provide the names and addresses of contributors on schedule B. However, those names and addresses aren't required to be made available for public inspection, except for private foundations. Section 527, political organizations, must also make all schedule B information available for public inspection. Other organizations required to file schedule B should omit the names and addresses of their contributors. However, other information requested for schedule B should be provided. If you file Form 990, you'll also need to file schedule O, supplemental information. All Form 990 filers must provide additional information on schedule O for two Form 990 entries, part 6, lines 11A and 19. You may use schedule O to explain other items as well, but you're required to use it for at least these two entries. If you file Form 990 without a schedule O, your return is considered incomplete. Form 990-EZ filers may use schedule O to provide additional information if they wish, but it is not required. Form 990 part 5, statements regarding other IRS filings and tax compliance can help you make sure you have completed all of the schedules needed for your organization. If you answer a question in part 5 �yes�, also complete the schedule the question refers to. Parts 5 and 6 of Form 990-EZ also have prompts to remind you to file certain schedules. If you're filing a Form 990 or 990-EZ, make an entry, including zero when appropriate, on all lines requiring an amount or other information to be reported. Don't leave any applicable lines blank, unless expressly instructed to skip that line. If answering a line is predicated on a "yes" answer to the preceding line, and if the organization's answer to the preceding line was "no," then leave the "if yes" line blank. I have already mentioned that if an organization's return is incomplete or the wrong return for the organization, the IRS will send it back with a form letter. The filer must follow the instructions to provide the missing or incomplete information, include a reasonable cause explanation of why the filer didn't initially submit all of the required information with the return. We may charge a penalty if we don't receive both the missing or incomplete information and a reasonable cause explanation. Sign the return. Attach a copy of the letter we sent you. Send the corrected return, the reasonable cause statement, and the copy of the letter within ten days of the date of the letter to the address on the top right of the letter. The date we receive a complete and accurate return is the date we consider the return filed. One last tip: Consider filing your organization's return electronically, even if electronic filing isn't required. Paper Form 990 returns have an average error rate of more than 25%. Built-in accuracy checks in electronic return preparation software catch most errors before the return is submitted. To learn more about electronic filing options for your organization, review to see the list of e-filing service providers. has a wealth of information about filing requirements for exempt organizations, including due dates for returns based on the tax year of the filing organization. Just go to and click the charities and nonprofits button near the top right of the home page. From there, you'll be able to easily navigate to lots of helpful links.

The IRS also has a toll-free service, 877-829-5500, again, 877-829-5500 for exempt organizations. Thanks for listening, and happy filing.