In a major revision of IRS Form 990 — the tax exmpt annual reporting form required by all nonprofits — the IRS has released for public comment a discussion draft of a redesigned Form 990, Return of Organizations Exempt from Income Tax. The discussion draft constitutes a significant redesign of the form, which has been revised only on a piecemeal basis since 1979. The IRS anticipates using the form for the 2008 tax year (returns filed in 2009).
The redesign of Form 990 is based on three guiding principles: enhancing transparency, promoting tax compliance, and minimizing the burden on the filing organization.
- Enhancing transparency means providing the IRS and its stakeholders with a realistic picture of the organization and its operations, along with the basis for comparing the organization to similar organizations.
- Promoting compliance means the form must accurately reflect the organization’s operations and use of assets, so the IRS may efficiently assess the risk of noncompliance.
- Minimizing the burden on filing organizations means asking questions in a manner that makes it relatively easy to fill out the form, and that do not impose unwarranted additional recordkeeping or information gathering burdens to obtain and substantiate the reported information.
The public comment period is through September 30, 2007.
The complete draft can be found here.
