IRS Releases New Video Series to Help Exempt Organizations Understand Redesigned Form 990 Requirements

The Internal Revenue Service has launched a new case study and video series to help exempt organizations and their tax preparers better understand the newly revised Form 990 series which must be filed for the 2008 tax year. 

The revised Form 990, redesigned for the first time in nearly 30 years, requires significantly more disclosure and transparency by exempt organizations. Most organizations that are exempt from federal taxation under Code Section 501(c) are required to file Form 990. The additional information captured on the revised Form 990 will give the IRS and the public a better view of how exempt organizations operate including a more detailed look at expenditures and executive compensation.

To help illustrate key points and answer important questions about the new Form 990, the IRS' Exempt Organizations Division developed "The New Form 990: Getting Started," a case study about a hypothetical organization - Exempt Organization for Disaster Relief (EODR). The hypothetical case study includes a set of facts describing organizational and financial aspects of EODR, and a completed Form 990 based on those facts. A video series walks viewers through common Form 990 reporting issues. The series includes the following segments: 

• Overview  - This video is a good place to start for people who have questions about the redesigned Form 990. It reviews some of the key things to consider about the Form 990 and the various schedules that may need to be completed, particularly Schedule R. 
• Revenue and Expenses - This segment covers two of the financial statement portions: Part VIII, Statement of Revenue, and Part IX, Statement of Functional Expenses. It looks at how to fill out the required columns of information for revenue and expenses
• Balance Sheet, Supplemental Financial Statements, and Schedule D - In this video, the IRS reviews Part X of the Form 990, the Balance Sheet, and Part XI, which covers Financial Statements and Reporting. Some of the differences from the prior version of Form 990 are explained. This segment also focuses on parts of Schedule D, Supplemental Financial Statements.
• Program Services, Other IRS Filings and Tax Compliance - This video focuses on Part III, which allows an organization to “tell its story” and describe its program services, and Part V, which covers other IRS filings and areas of tax compliance. Part V will alert exempt organizations whether they have other filing obligations besides the Form 990 and will help exempt organizations determine whether they engage in activities that raise tax compliance concerns.
• Compensation - In this segment , the IRS focuses on Form 990 compensation reporting in Part VII. There is an explaination regarding who needs to be listed in Part VII and explaination of the three types of compensation to report. The segment also highlights Schedule J, the compensation continuation schedule.
• Governance - In this segment, the IRS describes how to complete Part VI of the redesigned Form 990, which requests information about the organization’s governing body, management, policies and procedures, and disclosure practices. The segment also focuses on Schedule L, which requests information on transactions with interested persons, such as directors, officers, key employees, and their family members.
• Summary, Schedules, Signatures - This segment covers Parts I, II and IV of the Form 990—Summary, Signature Block and Checklist of Required Schedules. It also provides an overview of several new schedules to the Form 990.