Tuesday, August 19, 2008

IRS Releases Final Instructions for Form 990

The IRS just released final instructions for the heavily-revised Form 990 that nonprofits will start using next year. The final instructions are available on the IRS web site here.

The final instructions contain numerous changes to the draft instructions that were released in April. The changes are detailed in this document.

The revised Form 990 is a major overhaul of the reporting form for nonprofit organizations. In effect, the IRS has turned the 990 into more of an SEC-like disclosure document than a "tax form" and the new form will provide a wealth of new information to the IRS and the public about the operations of nonprofit organizations. The issuance of the final instructions completes the re-design process, although the IRS will continue to study certain aspects of 990 reporting with the possibility of adopting additional changes in the future. The redesign effort was monumental, and my own opinion is that the IRS did a heck of a good job even though I might quibble with some of the choices made (particularly with respect to nonprofit hospital reporting). It will be interesting to see how the new 990 affects not only what gets reported in the media about nonprofits, but also how the new reporting will affect the internal operations of nonprofits.



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I'm happy to see more detailed reporting requirements. While they will take some time to adjust to for those organizations that are acustomed to the old form, hopefully it will provide more oversight of compliance for all charities, specifically those who have not been reporting.


Posted by: Melanie | Aug 20, 2008 4:50:21 AM

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