New Year, New IRS Rules

With everything you had going on with your nonprofit during the back-to-back holiday seasons - not to mention other personal responsibilities - you might not have kept up with changes the IRS has implemented for nonprofits filing annual 990 forms.

No worries - we got you covered with the current filing requirements for tax-exempt organizations. We all know that filing late or submitting incomplete forms lead to thousands of dollars in IRS penalty fees - no group wants that. Here’s what you need to know about filing your annual tax return in 2017.

IRS Form 8868 Tax Extension
The 8868 extension form for exempt organizations has gotten reduced to a single form that grants an automatic 6-month extension of time. You can submit an extension request for the same applicable returns as before, which also means IRS Form 990-N (e-Postcard) is not eligible for an extension.

With no Part II of the 8868 form, there’s no longer a need for you to provide a reasonable explanation to gain the full 6-month extension. However, you are still limited to one extension per tax return for the filing year.

IRS Deadlines for Exempt Organizations
The changes with the 8868 extension form also bring slight changes to filing due dates. The filing deadlines aren’t necessarily different, but you should be aware that you only have two chances per year to file instead of the regular three.

For organizations operating on a calendar tax year, your filing due date is May 15. If you choose to file an extension, your extended deadline is Nov 15. There is no August deadline as there was with prior years, and if you fail to file before the November deadline, you’ll incur substantial penalties.

The filing due date for organizations running on a fiscal tax year is always the 15th day of the 5th month after your accounting period ends. If you opt for an extension at that time, you have until the end of six months to file your return - no other opportunities without late fees are available after the extended deadline.

E-file your 8868 extension form and 990 tax return quicker and easier than paper filing with ExpressTaxExempt.com. Our cloud-based application ensures that you submit a complete form, and if the IRS rejects your return, we identify the errors so you can correct them and re-transmit at no additional cost.

Contact our U.S. - based customer support team in Rock Hill, South Carolina for any questions or assistance with transmitting your return or extension form with the IRS. You can reach us at 704.839.2321, Monday through Friday from 9 a.m. to 6 p.m. EST or email us, day or night, with support@ExpressTaxExempt.com.

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Governing Body, Policies, and Disclosure Sections of Form 990

Federal tax law typically does not mandate particular management structures, operational policies, or administrative practices.

However, you are still required to report information regarding your organization's governing body and management, governance policies, and disclosure practices with IRS Form 990.

Not every policy or disclose practice may apply to your exempt organization - here are few guidelines about reporting the following sections with your 990 form:

Voting Members and Relationships
Enter the total count of your organization’s governing body members with the power to vote and the independent voting members. Indicate and describe any material differences of your governing body members if they do not have the same rights to vote.

If your organization’s current list of officers has a family or business relationship with other officers, you need to identify each person and describe their relationship.

Management Duties
Report if your organization appointed any management companies and describe all of the management duty details, if applicable. Management responsibilities include but are not limited to

• Hire, fire, or supervise personnel
• Plan executing budgets or financial operations
• Oversee exempt activities or unrelated trades or businesses

Important: The IRS doesn’t recommend reporting administrative services like payroll processing or investment management unless the filing organization conducts investment management services for others.

Significant Diversion
Report any significant changes in your organizing documents or bylaws for the filing year, if necessary. Indicate if your organization became aware during the year of a significant diversion of the organization’s assets. If so, be prepared to explain the nature of the diversion, dollar amounts and any property involved, corrective actions, and relevant circumstances - do not include the name of whoever diverted the assets.

Select whether your organization has members or stockholders and describe whether your group classifies as a stock corporation, a joint-stock company, partnership, a joint venture, or a limited liability company, if necessary.

Stockholders
If your tax-exempt organization has any members or stockholders, you need to describe the class or categories of each person, the decisions that require their approval, and the nature of their voting rights. You also are responsible for reporting any documentation of meetings and written actions of the governing body and committees with authority to act on its behalf.

Policies
Indicate if your organization controls any local chapters, branches, lodges or affiliates. Report any written policies or practices governing the activities of those subordinate groups to ensure their operations are consistent with the organization's tax-exempt purposes, if applicable.

Written Policy
Specify if your organization has a written conflict of interest policy, a written whistleblower policy, and a document retention and destruction policy. You should also have the information necessary to describe the process for determining the compensation of the officers and key employees.

Disclosures
List all the appropriate states which require a copy of your 990 form to fulfill state exempt organization or charitable solicitation reporting requirements. Indicate and explain whether or not your organization’s governing documents are available to the general public during the tax year.

Organization’s Books
Provide the details of the person who possesses the organization's books and records including their name, address, and phone number.

Our U.S. - based customer support can assist you with any technical issues regarding the governing body, policies, and disclosure sections so you can transmit an error-free 990 form. Contact us at 704.839.2321, Monday through Friday from 9 a.m. to 6 p.m. EST. Or you can submit a request with support@ExpressTaxExempt.com.

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