Smaller Nonprofits and the IRS Form 990-N Filing Requirement

IRS rules require that nonprofits whose gross receipts are normally less than $50,000 per year file Form 990-N each year.

Do you run a nonprofit with gross income under $50,000 per year? If so, did you file IRS Form 990-N with the IRS by May 15 of this year? If not, your nonprofit may have lost its tax-exempt status, or be well on the way to doing so.

IRS rules require that nonprofits whose gross receipts are normally less than $50,000 per year file Form 990-N each year. The form is due by the 15th day of the fifth month after the end of your nonprofit’s tax year—that is, four and one-half months after the end of the tax year. If, like most small nonprofits, your nonprofit uses the calendar year as its tax year, your tax year ends on December 31 and the return is due on May 15. If your nonprofit uses a fiscal year—that is, a year other than the calendar year as its tax year—the four and one-half month rule still applies. For example, if a nonprofit’s tax year ends on June 30, its information return would be due on November 15 of that year.

If your nonprofit fails to file Form 990-N for three consecutive years, it will automatically lose its tax exempt status. This occurs on the filing due date of the third year. For example, if your 990-N is due on May 15 each year, and you fail to file by May 15th of 2011, 20012, and 2013, your nonprofit will automatically lose its tax-exempt status on May 15, 2014.

The IRS has created a List of Automatically Revoked Organizations and posted it on is website. It is updated monthly.

If your nonprofit loses its tax-exempt status, you'll have to apply for a federal tax exemption all over again. That means filing IRS Form 1023 again and paying the hefty filing fee that comes with it (not to mention the headache of all that unnecessary paperwork).

There really is no excuse for not filing Form 990-N. It is an incredibly simple form that is filed for free electronically. It should take you no more than ten or 15 minutes to complete. The only information you need provide is your nonprofit's legal name, address, website address (if any), EIN, name and address of a principal officer, and tax year. You will also be asked whether your nonprofit has terminated or gone out of business.

Form 990-N is filed online through a website operated by the Urban Institute, a large nonprofit that has helped the nonprofit community with IRS compliance issues for many years. You do not need any special software, just access to the Internet and an email address for your nonprofit. Simply log on to the Urban Institute's website at and you'll find complete instructions.

For more information on what laws your nonprofit needs to follow when it comes to taxes, see Nolo's book, Every Nonprofit's Tax Guide.

May 2013

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