IRS Tax Forms  
Instructions for Form 990 & 990-EZ 2001 Tax Year

Return of Organization Exempt From Income Tax and
Short Form Return of Organization Exempt From Income Tax

Q. Erroneous Backup Withholding

Recipients of dividend or interest payments generally must certify their correct taxpayer identification number to the bank or other payer on Form W-9. If the payer does not get this information, it must withhold part of the payments as backup withholding. If the organization was subject to erroneous backup withholding because the payer did not realize it was an exempt organization and not subject to this withholding, it can claim credit on Form 990-T for the amount withheld. See the Instructions for Form 990-T. Claims for refund must be filed within 3 years after the date the original return was due; 3 years after the date the organization filed it; or 2 years after the date the tax was paid, whichever is later.


R. Group Return

If a parent organization wants to file a group return for two or more of its subsidiaries, it must use Form 990. The parent organization cannot use a Form 990-EZ for the group return.

A central, parent, or like organization can file a group return on Form 990 for two or more local organizations that are:

  1. Affiliated with the central organization at the time its annual accounting period ends,
  2. Subject to the central organization's general supervision or control,
  3. Exempt from tax under a group exemption letter that is still in effect, and
  4. Have the same accounting period as the central organization.

If the parent organization is required to file a return for itself, it must file a separate return and may not be included in the group return. See General Instruction B for a list of organizations not required to file.

Every year, each local organization must authorize the central organization in writing to include it in the group return and must declare, under penalty of perjury, that the authorization and the information it submits to be included in the group return are true and complete.

If the central organization prepares a group return for its affiliated organizations, check the Yes box in item H(a), in the heading of Form 990, and indicate the number of organizations for which the group return is filed in item H(b).

For item H(c), check Yes, to indicate that the group return includes all affiliated organizations covered by the group ruling. If you answer No to H(c), attach a list showing the name, address, and employer identification number (EIN) of each affiliated organization included in the group return. If either box in H(a) or H(d) is checked Yes, enter the four-digit group exemption number (GEN). Do not confuse the four-digit GEN number to be reported for item I with the nine-digit EIN number reported in item D of the form's heading.

The central organization should send the annual information required to maintain a group exemption letter to the:


Internal Revenue Service
Ogden Service Center
Ogden, UT 84201-0027.

An affiliated organization covered by a group ruling may file a separate return instead of being included in the group return. In such case, check the Yes box in item H(d), in the heading of Form 990, and enter the GEN number in item I.

Parts IV-A and IV-B of Form 990 do not have to be completed on group returns.


S. Organizations in Foreign Countries and U.S. Possessions

Refer to General Instruction B for the filing exemption for foreign organizations with $25,000 or less in gross receipts from U.S. sources.

Report amounts in U.S. dollars and state what conversion rate you use. Combine amounts from within and outside the United States and report the total for each item. All information must be written in English.


T. Public Interest Law Firms

A public interest law firm exempt under section 501(c)(3) or 501(c)(4) must attach a statement that lists the cases in litigation, or that have been litigated during the year. For each case, describe the matter in dispute and explain how the litigation will benefit the public generally. Also attach a report of all fees sought and recovered in each case. See Rev. Proc. 92-59, 1992-2 C.B. 411.


U. Political Organizations

A political organization subject to section 527 is a party, committee, association, fund, or other organization (whether or not incorporated) organized and operated primarily for the purpose of directly or indirectly accepting contributions or making expenditures, or both, for an exempt function.

The exempt function of a political organization is influencing or attempting to influence the selection, nomination, election or appointment of an individual to a federal, state, or local public office or office in a political organization. A political organization must be organized for the primary purpose of carrying on exempt function activities.

A political organization does not need to be formally chartered or established as a corporation, trust, or association. A separate bank account in which political campaign funds are deposited and disbursed only for political campaign expenses can qualify as a political organization.

On July 1, 2000, Pub. L. 106-230 was enacted, amending section 527 of the Code. The new law imposes three reporting and disclosure requirements on political organizations described in section 527: (1) an initial notice of status, (2) periodic reports of contributions and expenditures, and (3) annual returns. Rev. Rul. 2000-49, 2000-44 I.R.B. 430 provides questions and answers relating to the reporting and disclosure requirements for political organizations described in section 527.


V. Information Regarding Transfers Associated With Personal Benefit Contracts

Filers of Form 990 that engaged in activities involving personal benefit contracts must declare in Part X, Information Regarding Transfers Associated With Personal Benefit Contracts, whether or not they:

  1. Received any funds, directly or indirectly, to pay premiums on a personal benefit contract.
  2. Paid any premiums, directly or indirectly, on a personal benefit contract.

Note: Filers of Form 990-EZ must make this declaration in a statement attached to their form.

If premiums were paid on a personal benefit contract, the organization must report these payments on Form 8870 and pay an excise tax, equal to premiums paid, with Form 4720.

Section 170(f)(10)(F)(iii) requires a charitable organization to report annually its premium payments on a personal benefit contract with respect to a transferor and to identify the beneficiaries of those contracts. A transferor of funds to a charitable organization receives no charitable contribution deduction if the organization, directly or indirectly pays, or has previously paid, any premium on a personal benefit contract with respect to the transferor, or there is an understanding or expectation that any person will directly or indirectly pay any premium on a personal benefit contract with respect to the transferor (section 170(f)(10)(A)).

A personal benefit contract, generally, is any life insurance, annuity, or endowment contract that benefits, directly or indirectly, the transferor, a member of the transferor's family, or any other person designated by the transferor (other than an organization described in section 170(c)). A charitable organization is an organization described in section 170(c).

Section 170(f)(10)(F)(i) imposes on a charitable organization an excise tax equal to the premiums paid by the organization on any personal benefit contract, if the payment of premiums is in connection with a transfer for which a deduction is not allowed under section 170(f)(10)(A). For purposes of this excise tax, section 170(f)(10)(F)(ii) provides that premium payments made by any other person, pursuant to an understanding or expectation described in section 170(f)(10)(A), are treated as made by the charitable organization.

For more information on the reporting requirements of section 170(f)(10), see Notice 2000-24, 2000-17 I.R.B. 952 and Announcement 2000-82, 2000-42 I.R.B. 385.


W. Requirements for a Properly Completed Form 990 or Form 990-EZ

Public inspection. In general, all information the organization reports on or with its Form 990, or Form 990-EZ, including attachments, will be available for public inspection. Note, however, the public inspection rules for the Schedule B (Form 990, 990-EZ, or 990-PF), a required attachment for organizations that file Form 990 or Form 990-EZ. Make sure the forms and attachments are clear enough to photocopy legibly.

Signature. To make the return complete, an officer of the organization authorized to sign it must sign in the space provided. For a corporation, or association, this officer may be the president, vice president, treasurer, assistant treasurer, chief accounting officer, or other corporate, or association officer, such as a tax officer. A receiver, trustee, or assignee must sign any return he or she files for a corporation or association. For a trust, the authorized trustee(s) must sign.

TAXTIP:Generally, anyone who is paid to prepare the return must sign it in the Paid Preparer's Use Only area.


The paid preparer must:

  • Sign the return, by hand, in the space provided for the preparer's signature (signature stamps and labels are not acceptable).
  • Enter the preparer's social security number (SSN), preparer tax identification number (PTIN), or employer identification number (EIN), only if the Form 990, or Form 990-EZ, is for a section 4947(a)(1) nonexempt charitable trust that is not filing Form 1041.
  • Complete the required preparer information.
  • Give a copy of the return to the organization.

Leave the paid preparer's space blank if the return was prepared by a regular employee of the filing organization.

Recordkeeping. The organization's records should be kept for as long as they may be needed for the administration of any provision of the Internal Revenue Code. Usually, records that support an item of income, deduction, or credit must be kept for 3 years from the date the return is due or filed, whichever is later. Keep records that verify the organization's basis in property for as long as they are needed to figure the basis of the original or replacement property.

The organization should also keep copies of any returns it has filed. They help in preparing future returns and in making computations when filing an amended return.

Rounding off to whole dollars. You may show money items as whole-dollar amounts. Drop any amount less than 50 cents and increase any amount from 50 through 99 cents to the next higher dollar.

Completing all lines. Unless the organization is permitted to use certain DOL forms or Form 5500 as partial substitutes for Form 990, or Form 990-EZ (see General Instruction F), do not leave any applicable lines blank or attach any other forms or schedules instead of entering the required information on the appropriate line on Form 990 or Form 990-EZ.

Assembling Form 990 or Form 990-EZ. Before filing the Form 990, or Form 990-EZ, assemble the package of forms and attachments in the following order:

  • Form 990 or Form 990-EZ.
  • Schedule A (Form 990 or 990-EZ). The requirement to attach Schedule A (Form 990 or 990-EZ) applies to ALL section 501(c)(3) organizations and ALL section 4947(a)(1) nonexempt charitable trusts that file Form 990 or Form 990-EZ.
  • Schedule B (Form 990, 990-EZ, or 990-PF).
  • Attachments to Form 990 or Form 990-EZ.
  • Attachments to Schedule A (Form 990 or 990-EZ).
  • Attachments to Schedule B (Form 990, 990-EZ, or 990-PF).

Attachments. Use the schedules on the official form unless you need more space. If you use attachments, they must:

  1. Show the form number and tax year;
  2. Show the organization's name and EIN;
  3. Identify clearly the Part or line(s) to which the attachments relate;
  4. Include the information required by the form and use the same format as the form;
  5. Follow the same Part and line sequence as the form; and
  6. Be on the same size paper as the form.
 Check Box Checklist for a properly completed return.
Complete Schedule A (Form 990 or 990-EZ) if your organization is a section 501(c)(3), 501(e), (f), (k), (n) organization or a section 4947(a)(1) nonexempt charitable trust.
Complete Schedule A (Form 990 or 990-EZ), Part IV-A, Support Schedule, if you are required to check a box on line 10, 11, or 12 of Part IV-A of the Support Schedule.
File Form 990 instead of Form 990-EZ if your organization's gross receipts are more than $100,000 and total assets at the end of the year are more than $250,000.
Indicate the correct tax year in the heading of your form.
Have an officer of the organization sign the return.
Complete all Balance Sheet columns. (Part IV (and IV-A and IV-B) of Form 990; Part II of Form 990-EZ). Indicate N/A if a line, column, or Part does not apply. Indicate too, on the applicable line, if a schedule is attached. Do not substitute another balance sheet instead of completing the Part II Balance Sheet of Form 990-EZ.
Attach all required pages and schedules to the return. Include a list of subordinates if filing a group return.
Double-check the accuracy of your EIN, tax period, and group exemption number (GEN), if applicable.
Indicate the correct 501(c) subsection under which you are tax-exempt. If there has been a change, attach a copy of the latest determination letter. If the letter is unavailable, attach a description of your organization's primary exempt purpose.
Be aware that the Form 990, Form 990-EZ, the Schedule A (Form 990 or 990-EZ), and the attachments to be filed with these forms, are publicly disclosable. Note, however, the public inspection rules in the instructions for Schedule B (Form 990, 990-EZ, or 990-PF).
Section 501(c)(3) organizations required to complete lines 26, 27, or 28 of Schedule A (Form 990 or 990-EZ) must prepare lists for their own records to substantiate amounts on those lines. These lists are not to be filed with the return.
Do not check the Final Return box in the heading of the Form 990 or 990-EZ unless your organization has ceased operations.

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