In late December the IRS issued an updated version of Form 990, the return that charities and other tax-exempt organizations are required to file annually, and provided transition relief so that small exempt organizations will have time to adjust to the new form.
“When we released the redesigned draft form this past June, we said we needed a Form 990 that reflects the way this growing sector operates in the 21st century,” said Steven T. Miller, Commissioner of the IRS’ Tax Exempt and Government Entities division. “The public comments we received in response to our draft form helped us develop a final form consistent with our guiding principles of transparency, compliance and burden minimization.”
The final form released December 20th, retains the redesigned draft’s format of a core form and a series of schedules. In response to public comments, the new core form allows an organization to describe its exempt accomplishments and mission up-front and provides more opportunities throughout the form for the organization to explain its activities.
Other major changes were made to the form’s summary page, governance section, and various schedules, including those relating to executive compensation, related organizations, foreign activities, hospitals, non-cash contributions and tax exempt bonds. A checklist of schedules was also added.
The new form will be used for the 2008 tax year (returns filed in 2009). The IRS plans to release the related instructions in early 2008.
See post #2 for the transition periods for small organizations.
Comments (1)
In 2002, an interdenominational outreach ministry was formed within a small, rural Baptist Church in Georgia. The outreach provided charitable services within the local community and surrounding area, and operated on funds generated through bake sales and charitable donations, etc. The funds were maintained in the local Baptist Church checking account. In 2007, the ministry requested a separate checking account, within the church, and under the authority of the church. The deacons denied the request and told the ministry that a separate checking account would be against the law. Do you know of any reason that a separate checking account within the church, yet under the authority of the church, would be illegal? The deacons then passed a ruling that unless a person was a member of their church, that person could no longer fully participate in the outreach program, thereby disenfranchising outreach members from other churches that had been associated since its founding in 2002. The outreach members then voted to separate themselves from the church in order to continue being open to membership by individuals from any church. The outreach requested that the deacons find some methodology to provide them with the funds that had been raised for their ministry and were being held in the church checking account. The outreach ministry also started the process of seeking IRS recognition as a 501c3. Since 2002, the gross annual receipts for the outreach have always been less than $5000, and it is anticipated that the needed level of funding will continue to be less than $5000 annually. The deacons denied the outreach request for funding, stating that it would be illegal for the church to provide any charitable funding gift or donation to the outreach. Do you know of any legal reason that the church could not make a donation to the outreach ministry? We are seeking an amicable solution to a disruptive situation, and will appreciate any guidance you might give. Thank you.
Posted by David Dyer | February 17, 2008 11:12 AM
Posted on February 17, 2008 11:12