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Is Nonprofit Form 990 Required Drudgery or a Great Marketing Tool?

It can be both. The IRS requires nonprofits to file according to the chart below:

Status                                                                                       Form to File

Gross receipts normally ≤ $50,000                                                            990-N                     
Note: Organizations eligible to file e-Postcard may choose to file a full return

Gross receipts < $200,000, and                                                                  990-EZ
Total assets < $500,000                                                                              or 990

Gross receipts ≥ $200,000, or                                                                     990
Total assets ≥ $500,000

Private foundation - regardless of financial status                                       990-PF

Notice that nonprofits, except Private Foundations, can file the 990 Form in place of the simpler 990-N and 990-EZ forms. Why would anyone want to do that? 

The 990 Form has narrative sections to tell the story of a nonprofits mission, client/constituent support, and partnerships. Forms 990 are open to public inspection and read by potential donors and grantors to determine which nonprofits will receive funding. Use the narratives as a marketing tool. It is a place to showcase your mission, program service accomplishments (qualitative and quantitative), clients helped, and the value to the community.

Potential board members will also review the 990 to evaluate governance, policies, and compliance. As well as to ensure that the mission aligns with their own values. Use the narratives to attract board members who are the best fit for your organization.

So turn the drudgery into a marketing tool to attract donors and board members with colorful, descriptive narratives in the following 4 sections of Form 990:

1) Part I, Summary, 1 – briefly describe the organization's mission or most significant activities

2) Part III, Statement of Program Service Accomplishments, 1 – briefly describe the organization's mission

3) Part III, Statement of Program Service Accomplishments, 4 – describe the service accomplishments of the 3 largest program services – here you can share reasonable estimates, donated services, and attach photos.

4) Schedule O, Supplemental Information to Form 990 and 990-EZ (continuation of the narrative sections as well as explanations of answers in other sections).

For donors, grantors, and anyone else interested in reviewing a nonprofits' 990 Forms, they are easily accessible on GuidStar.org. The IRS will also provide a copy of 990's by going to https://www.irs.gov/charities-non-profits/exempt-organizations-public-disclosure-obtaining-copies-of-documents-from-irs

Form 990 is not just a tax return, use it to paint the perfect picture of your nonprofit.

Barbara Joyce, CPA