NOTE: This headliner is current through the publication date. Since changes may have occurred, no guarantees are made concerning the technical accuracy after the publication date.
Headliner Volume 251
November 13, 2008
Tax-exempt organizations and tax preparers who tuned in to the Internal Revenue Service’s Nov. 4 Tax Talk Today webcast learned the who, what, when, where, and how of preparing for the new Form 990.
Form 990 is the information return many tax-exempt organizations file with the IRS annually. The IRS has redesigned the form to reflect significant changes in the tax law and non-profit sector over the 30 years since the last major changes to it.
Drafts of the form, schedules and instructions are on the Tax Information for Charities & Other Non-Profits page. The final version is expected to be available on this page in December.
Form 990 was redesigned with three main principles in mind:
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Promote compliance
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Enhance transparency
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Minimize burden
The IRS received extensive public comment and consulted with external groups to develop a form and instructions to help minimize burden on filing organizations. The IRS increased maximum filing amounts for Form 990-EZ during a three-year transition period to allow many smaller tax-exempt organizations to file the short form. Organizations eligible to file Form 990-EZ during this period were encouraged to do so to give them more time to learn the new form.
An 11-page core form and 16 schedules replace the old nine-page form with its two schedules and various attachments. Main elements include a one-page summary of basic financial information, and new or revised content, such as governance, foreign activities and executive compensation reporting.
A comprehensive set of detailed instructions has more built-in tools, such as a checklist of required schedules, a sequencing list showing the order in which the core form and schedules should be completed, a glossary, a compensation matrix, and various examples and appendices.
The November 4 show alerted tax-exempt organizations to the new form and encouraged them to start planning now for the 2008 tax year filings due in 2009. The new form’s focus on activities, programs, and governance require the involvement of not only CFOs and accountants, but also the organizations’ directors, executives and program managers.
In light of the form’s more detailed reporting requirements, organizations will want to re-assess their internal reporting procedures. It is imperative for organizations and preparers of forms to start educating themselves about the new parts and key requirements. The instructions are a good place to start.
All of this information and much more are available in the show’s transcript on the Tax Talk Today Web site.
Moderated by Les Witmer, the November program’s panelists were: Eve Rose Borenstein, exempt organizations tax attorney, Borenstein and McVeigh Law Offices (BAM!); Stephen Clarke, tax law specialist, Rulings and Agreements, Exempt Organizations, Internal Revenue Service; Julie L. Floch, CPA, Eisner, director of Not-For-Profit Services; and Ronald J. Schultz, senior technical advisor to the commissioner, Tax Exempt and Government Entities Division, Internal Revenue Service.
Tax Talk Today is a webcast aimed at educating tax and payroll professionals on the most current and complex tax issues. Tax professionals are encouraged to watch and submit questions.
To access the free webcast, viewers can register online. Tax professionals who need continuing education credits are eligible to receive one CPE credit by viewing the Nov. 4 webcast and purchasing the credit.
The Tax Talk Today show on Jan. 13 will be a special 100-minute webcast, Getting Ready for Filing Season – 2009 (Individual and Business). Two continuing education credits will be offered for this extended program.
Learn More Online:
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