Oh no, your 990-EZ deadline is fast approaching!
Thankfully, deadlines are nothing new for you if you’re a nonprofit financial officer. Meeting the demands of your overflowing calendar has become second nature to you.
And, as it turns out, meeting deadlines has a profoundly positive impact on your organization.
Yet there are times when human error creeps in. When we put all the pressure on ourselves and don’t have proven systems in place to help us form checks and balances, we’re bound to miss something sooner or later.
When we do, it can lead to lost income, damaged professional relationships, and can put us behind on other deadlines, compounding the problem.
Timely nonprofit tax filing is crucial to avoiding corrections and refiling, fines, and potential loss of tax-exempt status for your organization.
So, how do you avoid missed deadlines, especially when it comes to something as important as filing your 990-EZ tax forms?
Fret not. With the right tools, strategies, and people, success is not only possible—it’s inevitable.
That’s how your organization became successful in the first place, right?
Let’s get back to basics and get prepared for tax season. Don’t worry. Taxes are kind of our thing, and we’ve got your back.
Let’s make sure you Never Miss Another 990-EZ Deadline.
What Is the 990-EZ filing Deadline?
Chances are, you have this date marked on your calendar and circled and underlined 20 times with red ink.
But in case you don’t, here it is:
According to the IRS, your 990-EZ form “must be filed by the 15th day of the 5th month after the end of your organization’s accounting period.”’
Thus, for an organization going by the typical calendar year, you’d have to file by May 15th of the following year.
However, many nonprofits end their tax cycle in June, so the deadline in that case would be November 15th.
What Happens if You Miss the Filing Deadline (or Are Going to Miss It)?
It’s crucial to understand the penalties for not filing your 990-EZ on time, and how to plan ahead if you think you’re going to be late.
Note: Incomplete filings are treated the same as late filings by the IRS.
If your nonprofit grosses less than $1,000,000 per tax year, late filing without reasonable cause will land you with a penalty of $20 per day, up to a total of $10,000 in fines or 5 percent of your total gross receipts—whichever amounts to less.
If your nonprofit grosses $1,000,000 or more per tax year, the fine increases to $100 per day that you don’t file.
If your nonprofit doesn’t file its 990-EZ for 3 consecutive years, you’re likely to lose your tax-exempt status with the IRS. There is no appeal process for automatic revocation of tax-exempt status.
There are, however, ways to have your tax-exempt status retroactively reinstated if you have reasonable cause for missing these deadlines. But in the meantime, you may be required to file for taxes like any other organization—which can be a huge headache.
Plus there’s no guarantee you’ll regain tax-exempt status, depending on how the IRS assesses your reasoning for not filing.
Being pulled off the list of tax-exempt organizations can have a negative impact on your fundraising, since you’re no longer eligible to receive tax-exempt gifts from donors, among other financial consequences.
If you anticipate you’ll miss your filing deadline, rather than face these harsh penalties, it’s better to file for an automatic 6-month extension using Form 8868.
How Do You Stay on Schedule and File on Time?
Okay, so now you know when your form 990-EZ is due and what happens when you don’t file on time.
However, there are sound strategies to ensure you never miss another 990-EZ deadline.
Here are some ways to get ahead of the game and ensure filing success:
Look at the Form Ahead of Time
If your organization’s gross receipts or assets has pushed you into a new filing bracket, and you’re filling out the 990-EZ for the first time this year, it’s crucial to understand what information will be asked of you.
But even if you’ve filed the 990-EZ for multiple years in a row, it’s important to view the form well in advance of the filing deadline.
For the record: you file the 990-EZ if your organization has gross receipts under $200,000 and total net assets under $500,000.
Why? Because filing rules can change.
The main sections of the form include:
- Revenue, Expenses, and Changes in Net Assets or Fund Balances
- Balance Sheets
- Statement of Program Service Accomplishments
- List of Officers, Directors, Trustees, and Key Employees
- Other Information about finances and Schedule forms
- Info specific to Section 501(c)(3) Organizations
You may also have to file additional Schedule forms, depending on how the IRS categorizes your nonprofit.
Getting Everyone on the Same Page
Once you have gathered the necessary receipts and financial information to file your 990-EZ, it’s helpful to meet with key executives well in advance of the filing deadline to discuss and verify the information.
If you’re a single entity organization, you only have to file on behalf of your organization.
However, if you’re filing on behalf of a parent company, a nonprofit chapter, or various chapters, it’s important to understand your multi-chapter filing dynamic.
Have your tax-season game plan set and ready to go, with your whole team on board, and success is yours.
Using a Certified 990-EZ e-Filer
The more you take on, the harder things can be and the more room there is for error as a result.
Nonprofits inherently understand the benefits of delegating important tasks and sharing the work, and tax filing is no exception.
Using an IRS-certified e-Filing service like File 990 to file your 990-EZ forms can add a crucial a level of ease and consistency. All we need is a small amount of information about your organization, such as your EIN and some other basics, and we’ll get the ball rolling.
File 990 services include:
- secure annual e-filing for 990-EZ or 990-N (e-postcard) tax forms
- reminders when it’s time to file, so you never miss another deadline
- our enterprise suite option for organizations with multiple chapters or components, so each component files correctly and maintains its tax-exempt status
By combining prudent planning, teamwork, common sense, and letting File 990 carry some of the heavy lifting come tax season, you’ll never miss a 990-EZ deadline again.
If you have questions, get in touch with File 990 here.
Or get started e-filing your nonprofit tax forms with us today.