Form 990 Filing Deadline Approaching

The Internal Revenue Service today reminded tax-exempt organizations that many have a filing deadline for Form 990-series information returns in mid-May.

Form 990-series information returns and notices are due on the 15th day of the fifth month after an organization’s tax-year ends. Many organizations use the calendar year as their tax year, making May 15 the deadline to file for 2016.

By law, organizations that fail to file annual reports for three consecutive years will see their federal tax exemptions automatically revoked as of the due date of the third year they are required to file. The Pension Protection Act of 2006 mandates that most tax-exempt organizations file annual Form 990-series information returns or notices with the IRS. The law, which went into effect at the beginning of 2007, also imposed a new annual filing requirement for small organizations. Churches and church-related organizations are not required to file annual reports.

Losing tax-exempt status can affect the ability to offer 403(b) plans. In 2014 and 2015, the IRS Employee Plans Compliance Unit conducted a project related to 403(b) plan sponsorship eligibility for organizations that lost their 501(c)(3) exempt status due to the automatic revocation for not filing a required return for three consecutive years. Some entities were unaware that their 501(c) status affected their eligibility to sponsor a 403(b) plan.

The IRS also urges tax-exempt organizations to file forms electronically to reduce the risk of inadvertently including Social Security numbers or other unnecessary personal information. Electronic filing also provides acknowledgement that the IRS has received the return and reduces normal processing time, making compliance with reporting and disclosure requirements easier.

The IRS offers an online search tool, Exempt Organizations Select Check, to help users more easily find key information about the federal tax status and filings of certain tax-exempt organizations, including whether organizations have had their federal tax exemptions automatically revoked. Organizations that have had their exemptions automatically revoked and wish to have that status reinstated must file an application and pay the appropriate user fee.