More 990 Resources

The last post listed an IRS webinar for the new 990 and I put up a to-do list a while back. You think I would be done touting new 990 resources but you would be wrong! In the spirit of making sure there are enough resources noted out there to satisfy as many people as possible I give you one more. A big hat tip to Nancy at Non-profit accounting help for pointing out this resource from avenue2possibilities. It includes samples of many of the policies the new form 990 will be asking about and a workbook and checklist to go through to help make sure you are ready. So now all you have to do is put the policies in place!

And if they ever create a New 990 Comic Book you will hear about it here first thing, promise.

Retirement Account Changes

Does your nonprofit have a 403(b) retirement plan for its employees? If it does have you heard about all the changes taking effect for 403(b) plans? Do you know what you need to do to get ready for them?

As if getting ready for a new form 990 wasn't enough we also have to make sure our 403(b) plans are in order. The National Council of Nonprofit Associations is holding two webinars about the changes that will be presented by Bob Architect, Senior Tax Law Specialist at the IRS.

The first, a general presentation regarding the changes and how they will affect your organization, is Tuesday, October 28 at 3:00 - 4:15 pm Eastern. The second one, a comprehensive presentation regarding the changes for individuals who handle employee benefits, is Wednesday, November 12 at 3:30 - 4:45 pm Eastern. CAN Members get $10.00 off the $35.00 registration fee.

2008 Mileage Rates

Heads up for 2008, the changes have been announced:

Beginning Jan. 1, 2008, the standard mileage rates for the use of a car (including vans, pickups or panel trucks) will be:

• 50.5 cents per mile for business miles driven;
• 19 cents per mile driven for medical or moving purposes; and
• 14 cents per mile driven in service of charitable organizations.

More info on the whys and hows can be found here.

Upcoming IRS Events in CA

Two events are coming up. Info on both are here.

The first is a one day event in Sacramento and there are three dates in December, the 18th through the 20th. "This introductory workshop is designed for administrators or volunteers who are responsible for an organization's tax compliance."

The second is in Los Angeles and is the Western Conference on Tax Exempt Organizations, a big two day event for "attorneys, accountants, and executives of tax-exempt organizations, co-sponsored by Loyola Law School and IRS Exempt Organizations; early bird registration rate available until October 15."

What would you ask the IRS?

On August 9th there will be a call hosted by the National Council of Nonprofit Associations to bring together statewide nonprofit agencies and their constituents with a representative from the IRS to discuss the new draft form 990.

NCNA has called for questions in advance that they can give to the IRS in advance so we can make the most of our time on the call. If you would like to pose a question about the form please email it to astrand @ CAnonprofits.org by 1:30 pm on Friday August 3rd. Sorry this is such a tight turn around but NCNA wants some time to organize the questions before submitting them.

If you are going to be on the call or not, please do feel free to pose your questions. The conversation will be recorded and I will post questions raised and answers given.

Here is a question posed by some of us working on advisory committees: Should the threshold for filing the 990 be raised? Currently you need to file if you have $25,000.00 in gross receipts. You can file a simplified 990EZ if gross receipts during the year are less than $100,000 and its total assets at the end of the year are less than $250,000. Proposals include:

• Eliminate the 990EZ (there is no proposal to change this form by the way, just the 990), raise the filing level to $50,000.00 and have organizations that don’t hit that mark file the new 990N
• $50,000 or less - new 990N, $50,000-$100,000 – Form 990EZ, $100,000 and over – New Form 990
• Keeping things as they are

What do you think?

August 9th Call with IRS

A national organization that CAN is a member of, the National Council of Nonprofit Associations, is hosting a call with the IRS abut the new form 990. CAN members can participate on this call in two ways:

1. Join in on the call! It is only $10.00 (to cover the costs of the call) and will be an invaluable opportunity to express your questions, concerns and / or praise for the redesigned form.
   
   
2. Post your questions below about the form so that I can submit them to the IRS rep and ask them on the call for you. Please post any questions in the comments section below and I'll make sure they get the attention they deserve.

Thanks!

More on the New 990

Well some of the first criticisms of the new IRS form 990 are up. I'm interested to know what you think about what the president of Charity Navigator has to say.

I have some initial thoughts on the core form. I like the summary section of part 1. It lays out the more important aspects of the form in a fairly straight forward way, what the casual reader of a 990 really will want to see. We do still need a way to educate readers on what the information means, maybe a new Peter Swords book?

Overall the form feels easier to understand and grasp. The Parts have an ordered feel to their layout, every part is a complete section. The form is longer by page count but it goes faster.

Some questions that came up during the first go through:

• Part I number 8b, what is it trying to show? What is a “good” metric? I don’t think that benchmark needs to be on the form.
• Part I number 9, if there is no other explanation a person who doesn’t understand how a NP operates numbers here may make them think the NP is doing something wrong. I don’t see a reason for listing 9 on the summary page, don’t see what it serves in the big picture.
• Part I number 15, if this is a larger number it could at first glance be a bit misleading.
• Part IV number 1f, “gifts grants,” what does that mean? Typo?
• Part V number 23, great! I like the added criteria, forces people to not be lazy.

I’ll list more as I come across them upon more in depth reading.

Draft Redesigned Form 990

It is finally out. The idea is to use this form for the 2008 tax year, so one would be filling this out in 2009.

You can check out all the information here, you will be able to download a copy of the new form, read about the changes and send in comments. All the forms and info is in PDF format.

[EDIT] I have assembled the most pertinent forms into one file to download, the IRS site lists all 20 plus informational sheets, forms and schedules as individual downloads. New stuff and info about the new stuff is all put together here. Its about two megabytes, about a minute and a half to download with a good connection.

This is a big redo, and YOU have the opportunity to comment on it! I'll post my thought about the new form soon.

Alan

990-T Disclosure Rules

I have mentioned this before but it looks like there is new guidence out there for how it will work.

The Internal Revenue Service recently issued interim guidance (Notice 2007-45) regarding the public disclosure of Form 990-T by tax-exempt organizations. The new disclosure requirements were initially set forth in the Pension Protection Act of 2006; Notice 2007-45 now provides the following additional specifics:

• The new Form 990-T public disclosure rules apply to all Forms 990-T filed after August 17, 2006
• The public disclosure rules for Form 990-T are the same as they are for Form 990
• Any religious or governmental entities not currently required to file a Form 990, but who file a Form 990-T, are required to publicly disclose their Form 990-T
• The Internal Revenue Service will not be making copies of the Form 990-T available to Guidestar
• The tax-exempt organization is not required to put a copy of the Form 990-T on their web site
• Tax-exempt organizations preparing a Form 990-T solely for purposes of claiming the telephone excise tax refund are not required to make such Form 990-T available for public inspection

Thanks Brian for the heads up!

New Electronic Filing Requirement for Small Organizations

e-Postcard (Form 990-N)
Beginning in 2008, small tax-exempt organizations that previously were not required to file returns may be required to file an annual electronic notice. With the enactment of the Pension Protection Act of 2006 (PPA), these small tax-exempt organizations will now be required to file electronically Form 990-N, also known as the e-Postcard, with the IRS annually for tax periods beginning after December 2006.

WebCPA | Regulatory spotlight shines on NFPs

WebCPA | Regulatory spotlight shines on NFPs

Thanks to a board member for sending me this link. The article is another good round up of what is going on out there.

New Tax Law Changes: The Pension Protection Act of 2006 (H.R. 4)

Here is the latest information from CAN's Public Policy Update, which you can subscribe to here if you are so inclined, From our Public Policy Director Ken Larsen. There are some big changes that will affect our reporting.

The Pension Protection Act of 2006 (H.R. 4) contains numerous changes to the federal laws affecting tax-exempt organizations. To help nonprofits and donors to be in compliance, the IRS has posted guidances on its web site (http://www.irs.gov/charities/article/0,,id=161145,00.html).

Key provisions of the legislation include the following:

• Section 501(c)(3) organizations that file unrelated business income tax returns (Forms 990-T) must now make them available for public inspection.
• Private foundation and excess benefit penalty excise taxes are doubled.
• Beginning in 2008, exempt organizations with gross receipts under $25,000 must file an annual notice with the IRS.
• Controlling organizations must report income from and loans to controlled organizations as well as transfers between controlled and controlling organizations. This provision is effective for returns due (without regard to extensions) after the date of enactment.
• Donor advised funds, supporting organizations, and credit counseling organizations are subject to new requirements.
• Supporting organizations that want to change their public charity classification should follow the procedures outlined in Announcement 2006-93.
  
• Notice 2006-109 provides interim guidance on issues affecting supporting organizations and sponsoring organizations of donor advised funds.
• Individual Retirement Account (IRA) owners age 70 ½ or older are permitted to directly transfer tax-free, up to $100,000 per year to an eligible charity. Notice 2007-7 clarifies several issues related to this provision.
• Charitable contribution deductions for food, book, and certain conservation property are increased.
• Charitable contribution deductions for monetary donations, certain easements, taxidermy property, clothing and household goods, and certain other items are limited.
• Notice 2006-96 provides guidance regarding appraisal requirements for non-cash charitable contributions, including transitional guidance relating to the definitions of qualified appraisals and qualified appraiser.
• Notice 2006-110 provides guidance on new recordkeeping requirements for charitable contributions made through payroll deductions.
• The IRS highlighted changes that may affect charitable giving in News Release IR-2006-92.