990 Filing for Corporate Grantmakers

Electronic Filing: While the requirements regarding electronic filing of Forms 990 and 990-PF have not changed, the electronic filing requirement for some organizations is still relatively new. For that reason, you may want to revisit the mandatory electronic filing rules to determine whether your foundation is required to file electronically this year. For additional information on e-filing regulations for nonprofits, visit the e-file for Charities and Non-Profits page of the IRS website.

New Form 990 since the 2008 Tax Year: For corporate foundations organized as public charities, the IRS redesigned the Form 990 to be used beginning with the 2008 tax year. In other words, this form was applicable beginning with the 2008 tax year. According to the IRS, the redesign was based on the principals of “enhancing transparency, promoting tax compliance, and minimizing the burden on the filing organization.”

The redesigned form consists of one core form and 16 schedules. The number of schedules an organization will be required to fill out will depend on its activities. For example, a new schedule for reporting of grants to organizations and individuals outside of the United States may be applicable to some corporate foundations. Another schedule for hospitals, however, would not.

Public charities might find it helpful to review the form now to make sure required information is being collected throughout the year. The redesigned form and additional information can be found on the IRS website. Note that the final instructions for the redesigned Form 990 have not yet been issued.

No similar redesign project is underway for Form 990-PF.

Form 990-N: Beginning in 2008, small public charities that were not required previously to file returns may have to file an annual electronic notice, Form 990-N, also referred to as the “e-Postcard.” The requirement applies to the following small organizations:

1. public charities with gross receipts normally $25,000 or less for tax years ending after December 31, 2007 and before December 31, 2010
2. public charities with gross receipts normally $50,000 or less for tax years beginning after December 31, 2010

The IRS noted that organizations that fail to file this form for three consecutive years will lose their tax-exempt status. Most corporate foundations file either Form 990 or Form 990-PF so it is unlikely that corporate foundations will be affected by this requirement. However, it may be helpful to know that some of your small grantees have this obligation. Organizations whose grantees are required to file a 990-N may use the IRS’ online search tool, Select Check, to verify if the 990-N has been filed and to view the filing. Information on the Form 990-N is available on the IRS website.

Last updated September 2012.

Disclaimer

The information provided in this resource is based on our continuing analysis of the Pension Protection Act. Every effort has been made to ensure the accuracy of this information. Due to the complexity of the PPA and the fact that many of these provisions introduce issues that are new to the Internal Revenue Code, this information is subject to change. Please check back here and on the IRS website (www.irs.gov) for updates. This information is not a substitute for expert legal, tax, or other professional advice and we strongly encourage grantmakers and donors to work with their counsel to determine the impact of the PPA and related guidance on their particular situations. This information may not be relied upon for the purposes of avoiding any penalties that may be imposed under the Internal Revenue Code.