New IRS Form 990 Pushes Non-Profits To Comply With State Rules

Beginning this year, a newly designed IRS annual return on Form 990 must be filed by non-profits. While churches and various church-affiliated organizations are exempt from filing the form, other religious organizations must do so. An article yesterday in On Philanthropy , as well as an earlier article in Nonprofit Business Advisor, point out that among the new questions on Form 990 is Section C, Line 17 asking for a list of all states in which a copy of the federal Form 990 is required to be filed. This effectively requires the non-profit to list all states where its compliance with state charity registration laws is necessary. Schedule G , Question 3, asks where the organization is registered or licensed to solicit funds. The articles say that in the past many charities have ignored state requirements, but the new federal Form 990 questions are likely to change that. Organizations will need to determine whether their activity-- particularly their online activity-- amounts to a solicitation in various states. They will also need to look closely at the widely differing exemptions from state to state.