Nonprofit Need-to-Knows: Annual Tax Filing

Filing tax forms is most likely not why you started your nonprofit organization. Because this process can be taxing (pun intended) for individuals and especially for nonprofits, I decided to share some information that hopefully makes it easier on your organization.

In general, nonprofit organizations, have an annual tax reporting requirement, although there are exceptions. So, unless your organization is exempt from annual filing requirements, your organization will be expected to file an annual form with the IRS. This can be Form 990, Form 990EZ or Form 990-N. See the table below to find out which form is right for your organization.

The annual filing is due every year by the 15th day of the 5th month after the close of your tax year. For year-end filers, that is May 15th. The IRS needs to receive and accept your organization’s annual form before the deadline and failing to file a required return by the due date may result in a monetary penalty. If an organization fails to file its annual form (990, 990-EZ or 990-PF) on time for three years in a row, the IRS will automatically revoke its tax-exempt status. If your tax-exempt status is revoked, you’ll receive a letter from the IRS and the revoked status will be listed on the IRS’ Tax Exempt Organizations Search page. The only way to get it back is to reapply and pass a test for retroactive determination.

In addition to filing an annual return with the IRS, most Minnesota charitable organizations must also submit an annual report on their operations and activities to the Charities Division of the Minnesota Attorney General’s Office. If your organization files a Form 990, it must be attached to the annual report. Organizations that file a 990-EZ, 990-N or 990-PF must fill out the annual report’s financial statement. The organization’s annual report must be postmarked by the 15th day of the seventh month after its fiscal year-end, and if the filing is late your organization will be subject to a fine. So, take care to annually file your tax return by the due date.

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