Charities 2005[791]

Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 by Paul Arnsberger N onprofit charitable organizations exempt from income tax under Internal Revenue Code (IRC) section 501(c)(3) filed over 286,000 information returns for Tax Year 2005, an increase of 4 percent from 2004. These organizations held over $2.2 trillion in assets, an increase of 9 percent from the previous year. They reported nearly $1.3 trillion in revenue, 68 percent of which came from program services (Figure A). The statistics in this article exclude private foundations and most organizations with receipts totaling less than $25,000, as well as most churches and certain other types of religious organizations. Labor and agricultural organizations exempt under IRC section 501(c)(5) filed 19,837 Forms 990 and 990-EZ for 2005.1 Assets reported by these organizations totaled $29.7 billion. Of the $20.7 billion in revenue reported by labor and agricultural organizations, the majority ($13.5 billion) came from membership dues and assessments. The statistics for charities and other tax-exempt organizations reported in this article are based on data compiled from Form 990, Return of Organization Exempt from Income Tax, and Form 990-EZ, the short form version of this information return. The latter form may be completed by smaller organizations, those with end-of-year assets of less than $250,000 and gross receipts of $25,000 to $100,000. Only condensed income statements and balance sheets are required from filers of the short form, which accounted for 21 percent of the returns filed by organizations exempt under Code sections 501(c)(3) and (5) for Tax Year 2005.2 Figure A Nonprofit Charitable Organizations, Selected Financial Data, Tax Years 2004-2005 [All figures are estimates based on samples—money amounts are in millions of dollars] Item 2004 (1) Number of returns Form 990 Form 990-EZ Total assets Total liabilities Net assets Total revenue Program service revenue Contributions, gifts, and grants Investment income [1] Other Total expenses 276,199 218,851 57,348 2,058,610 782,510 1,276,100 1,152,989 801,199 248,570 27,830 75,391 1,058,489 2005 (2) 286,615 226,246 60,369 2,241,887 830,635 1,411,252 1,252,889 852,638 276,292 35,999 87,960 1,137,908 Percentage change (3) 3.8 3.4 5.3 8.9 6.2 10.6 8.7 6.4 11.2 29.4 16.7 7.5 [1] Includes "interest on savings and temporary cash investments," "dividends and interest from securities," and "other investment income (loss)" from Form 990 and "investment income (loss)" from Form 990-EZ. NOTES: Data are from both Forms 990 and 990-EZ for nonprofit charitable organizations that are tax-exempt under Internal Revenue Code section 501(c)(3) and exclude private foundations and most organizations with receipts less than $25,000, as well as most churches, and certain other types of religious organizations. Detail may not add to totals because of rounding. Charitable Organizations Tax-Exempt Under Internal Revenue Code Section 501(c)(3) In order to qualify for tax-exempt status, an organization must show that its purpose serves the public Paul Arnsberger is an economist with the Special Studies Special Projects Section. This article was prepared under the direction of Barry Johnson, Special Studies Branch Chief. good, as opposed to a private interest. The activities of nonprofit organizations are limited in that they must further one or more of the purposes for which they were granted tax-exempt status. Organizations that are exempt under IRC section 501(c)(3) are those whose purposes are religious, charitable, scientific, literary, or educational. In practice, these categories cover a broad range of activities. Examples of the varied exempt purposes of these charitable organizations include nonprofit hospitals, educational institutions, youth organizations, community fundraising campaigns, public charities, local housing organizations, historical societies, and environmental preservation groups. These organizations 270 1 Beginning with the Tax Year 2004 study, the annual SOI Bulletin article on charities and other tax-exempt organizations has featured data on nonprofit charitable organizations exempt under IRC section 501c(3), as well as one other category of organizations defi ned under IRC section 501(c). For 2005, IRC section 501(c)(5) labor and agricultural organizations are presented. SOI continues to collect annual data on organizations exempt under IRC sections 501(c)(4) and 501(c)(6) through (9). Data from these organizations can be found in Tables 2, 3, and 4 at the end of this article. Additional tax-exempt organizations are described under IRC sections 501(c)(1), (2), and (10) through (27). Because they tend to constitute a small proportion of fi nancial activity for the nonprofit sector, SOI does not collect data for these organizations. 2 Unless otherwise indicated, data presented in this article were reported by both Form 990 and 990-EZ fi lers. The tables at the end of the article separate data by type of form. Detailed data for Form 990 filers are provided in Tables 1, 2, and 3, while Form 990-EZ data are found in Table 4. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 may not allow net earnings to inure to the benefit of a shareholder or individual. Activity attempting to influence legislation cannot be a substantial part of an organization’s activities, and the organization may not intervene in a political campaign on behalf of, or in opposition to, any candidate.3 Generally, a donor’s contribution to one of these organizations is taxdeductible. Of the 807,421 active nonprofit charitable organizations recognized by the Internal Revenue Service (IRS) under Code section 501(c)(3), 286,615 filed Form 990 or 990-EZ returns for accounting periods that began in Calendar Year 2005.4 Those not required to file included churches and certain other religious organizations, as well as organizations with annual gross receipts totaling less than $25,000.5 Nonprofit private foundations, which are also taxexempt under Code section 501(c)(3), are required to file separately on Form 990-PF, Return of Private Foundation.6 Financial Characteristics of Nonprofit Charitable Organizations Although 65 percent of the returns filed by section 501(c)(3) organizations for 2004 were filed by small organizations, those with assets of less than $500,000, these organizations held less than 1 percent of the total assets and reported just 4 percent of total revenue (Figure B). In comparison, large organizations, those with assets of $10 million or more, represented just 6 percent of the returns filed, but accounted for 90 percent of the total asset holdings and over 83 percent of the total revenue reported. The nonprofit charitable organizations in this study reported total revenue of nearly $1.3 trillion for 2005. Program service revenue, totaling $852.6 billion, was the major source of revenue for these organizations. This revenue comprises the fees collected by organizations in support of their tax-exempt purposes and includes tuition and fees at educational institutions, hospital patient charges (including Medi- Figure B Nonprofit Charitable Organizations, by Asset Size, Tax Year 2005 [All figures are estimates based on samples—money amounts are in millions of dollars] Returns Asset size Number (1) Total Under $100,000 [1] $100,000 under $500,000 $500,000 under $1,000,000 $1,000,000 under $10,000,000 $10,000,000 under $50,000,000 $50,000,000 or more 286,615 116,475 68,993 27,011 56,717 11,852 5,567 Percentage of total (2) 100.0 40.6 24.1 9.4 19.8 4.1 1.9 Amount (3) 2,241,887 3,912 16,795 19,030 184,239 253,241 1,764,669 Total assets Percentage of total (4) 100.0 0.2 0.7 0.8 8.2 11.3 78.7 Total revenue Amount (5) 1,252,889 14,026 23,993 16,414 154,082 169,425 874,950 Percentage of total (6) 100.0 1.1 1.9 1.3 12.3 13.5 69.8 [1] Includes returns with zero assets or assets not reported. NOTES: Data are from Forms 990 and 990-EZ for nonprofit charitable organizations tax-exempt under Internal Revenue Code section 501(c)(3) and exclude private foundations and most organizations with receipts less than $25,000, as well as most churches and certain types of religious organizations. Detail may not add to totals because of rounding. 3 For more information on the requirements for tax exemption under 501(c)(3) and other Code sections, see Internal Revenue Service Publication 557, Tax-Exempt Status for Your Organization. 4 Data presented in this article are from Tax Year 2005 Forms 990 and 990-EZ fi led in Calendar Years 2006 and 2007. The total number of nonprofit charitable organizations, including those not required to file Form 990 or Form 990-EZ, was obtained from the IRS Exempt Organizations Business Master File (December 2005) and does not include private foundations filing Form 990-PF, Return of Private Foundation. 5 The $25,000 fi ling threshold is an average of an organization’s gross receipts over the previous 3 years. 6 For information on private foundations, see Ludlum, Melissa, “Domestic Private Foundations and Charitable Trusts: Charitable Distributions and Investment Assets, Tax Year 2004,” Statistics of Income Bulletin, Fall 2007, Volume 27, Number 2. 271 Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Figure C Sources of Nonprofit Charitable Organization Revenue, by Asset Size, Tax Year 2005 100% 80% 60% 40% 20% 0% Under $100,000 [1] $100,000 under $500,000 $500,000 under $1,000,000 under $1,000,000 $10,000,000 Asset size Source of revenue Contributions, gifts, and grants Program service revenue Membership dues Other $10,000,000 under $50,000,000 $50,000,000 or more [1] Includes returns with zero assets or assets not reported. NOTES: Data are from Forms 990 and 990-EZ for nonprofit charitable organizations that are tax-exempt under Internal Revenue Code section 501(c)(3) and exclude private foundations and most organizations with receipts less than $25,000, as well as most churches and certain other types of religious organizations. care and Medicaid payments), and admission fees collected by museums, community performing arts groups, and YMCA/YWCA. Figure C illustrates the types of revenue reported by organizations of different sizes. Large organizations received over 72 percent of their total revenue from program service revenue, while small organizations received over half of their revenue from contributions, gifts, and grants. On Form 990 (but not on Form 990-EZ), expenses for nonprofit charitable organizations are grouped into four major categories: program services, fundraising, management and general, and payments to affiliates. Program service expenses are those associated with activities that further an organization’s exempt purpose; fundraising expenses are those incurred in soliciting contributions, gifts, and grants; and management and general expenses include those administrative and overhead costs that are not spe272 cifically related to program services or fundraising activities. The three categories described above are broken down by such specific functional expense items as grants and allocations, salaries and wages, professional fees, and supplies. (See Table 2 at the end of this article.) The fourth major category, payments to affiliates, which includes distributions to organizations closely related to the reporting organizations, such as dues paid by local chapters to State and national agencies, are not broken down into specific functional expenses. Program service expenses accounted for the vast majority (86 percent) of total expenses reported by filers of Form 990; management and general expenses totaled 12 percent; and fundraising expenses and payments to affiliates, combined, accounted for less than 2 percent. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Figure D Compensation of Nonprofit Charitable Organization Officers, Directors, Trustees, Key Employees, and Other Employees, Reported on Form 990, by Asset Size, Tax Year 2005 [All figures are estimates based on samples—money amounts are in millions of dollars] Officers, directors, trustees, and key employees Contributions and other benefits [1] (4) Other employees Asset size Number of Form 990 returns Total expenses Compensation (1) Total Under $100,000 [3] $100,000 under $500,000 $500,000 under $1,000,000 $1,000,000 under $10,000,000 $10,000,000 under $50,000,000 $50,000,000 or more (2) (3) Compensation (5) Contributions and other benefits [2] (6) 226,246 63,069 62,030 27,011 56,717 11,852 5,567 1,135,349 11,789 22,274 15,423 145,623 156,894 783,346 15,301 1,051 1,491 1,029 4,187 2,738 4,805 1,917 65 85 89 389 363 927 380,539 2,596 6,671 4,868 53,662 53,896 258,846 71,777 236 820 626 8,282 9,482 52,332 [1] Includes "contributions to employee benefit plans and deferred compensation plans" and "expense account and other allowances" reported on Part V of Form 990. [2] Includes "pension plan contributions" and "other employee benefits" reported on Part II of Form 990. [3] Includes returns with zero assets or assets not reported. NOTES: Data are from Form 990 for nonprofit charitable organizations that are tax-exempt under Internal Revenue Code section 501(c)(3) and exclude private foundations and most organizations with receipts less than $25,000, as well as most churches and certain other types of religious organizations. Detail may not add to totals because of rounding. Compensation Figure D shows compensation data reported by nonprofit charitable organizations on Form 990. Salaries, wages, and benefits are presented for executives, such as officers, directors, trustees, and key employees, as well as other employees. (Data from Form 990-EZ are not included in this section because that return does not distinguish between types of compensation nor types of employee.) For Tax Year 2005, nonprofit charities reported $470.0 billion in compensation and benefits on Form 990. The majority of this, 81 percent, was in the form of other employee salaries and wages. Salaries of executives officers, directors, trustees, and key employees totalled $15.3 billion. In addition to salaries and wages, Form 990 filers reported $73.7 billion in benefits paid to their employees and executives. Examples of these benefits include contributions to pension, health, and insurance welfare plans; payments to deferred compensation and severance plans; fringe benefits; and expense account reimbursements. Compensation and benefits represented a significant portion of the total expenses reported by nonprofit charitable organizations on Form 990, over 41 percent. When viewed by size of organization and type of employee, certain patterns emerge. 7 For small organizations, those reporting assets less than $500,000, other employee salaries, wages, and benefits represent slightly more than 30 percent of total expenses for Tax Year 2005; large organizations with assets of at least $50 million reported 40 percent of their expenses in the form of employee salaries, wages, and benefits. For executives, this compensation pattern is reversed. Salaries and benefits paid to executives, such as officers, directors, trustees, and key employees, accounted for nearly 8 percent of total expenses at small organizations, but less than 1 percent at large organizations. Nonprofit Charitable Organizations Classified by NTEE Codes The National Taxonomy of Exempt Entities (NTEE) is a classification system developed by the National Center for Charitable Statistics, which classifies organizations by institutional purpose and major programs and activities.7 It recognizes 26 major groups, which can be aggregated into 10 program categories, as shown in Figure E. The organizations were classified for statistical purposes by the IRS Statistics of Income Division on the basis of information provided in the “Statement of Program Service Accomplishments” section of Forms 990 and 990-EZ. 273 For information on the National Taxonomy of Exempt Entities classification system, see the National Center for Charitable Statistics Web site: www.ncc.urban.org. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Figure E Selected Items for Nonprofit Charitable Organizations Classified by NTEE Category, Tax Year 2005 [All figures are estimates based on samples—money amounts are in millions of dollars] Revenue NTEE major category [1] Number of returns Total assets Net assets Contributions, gifts, and grants (5) 276,292 15,860 69,934 7,723 52,146 70,069 16,700 37,460 6,193 207 Program service revenue (6) 852,638 6,962 126,802 2,667 607,470 86,278 1,647 17,818 1,430 1,564 Total expenses Excess of revenue over expenses (8) 114,981 5,397 41,605 2,003 38,185 10,050 1,838 14,241 1,242 421 Total (4) 1,252,889 29,187 243,061 12,355 698,535 171,451 19,226 67,360 9,045 2,670 (1) Total Arts, culture, and humanities Education Environment, animals Health Human services International, foreign affairs Mutual, membership benefit Public, societal benefit Religion related 286,615 28,972 52,530 12,422 35,669 108,283 4,167 25,722 18,182 667 (2) 2,241,887 89,167 744,531 33,494 860,780 251,228 17,587 208,372 21,512 15,216 (3) 1,411,252 72,625 548,623 27,510 463,266 123,486 12,810 138,191 17,470 7,272 (7) 1,137,908 23,790 201,456 10,352 660,350 161,401 17,388 53,119 7,803 2,249 [1] The National Taxonomy of Exempt Entities (NTEE) is a classification system that uses 26 major field areas that are aggregated into the categories shown above. It was developed by the National Center for Charitable Statistics. NOTES: Data are from Forms 990 and 990-EZ for nonprofit charitable organizations that are tax-exempt under Internal Revenue Code section 501(c)(3) and exclude private foundations and most organizations with receipts less than $25,000, as well as most churches and certain other types of religious organizations. Detail may not add to totals because of rounding. Health-related organizations comprised the largest NTEE category in terms of financial activity, with 38 percent of all assets and 56 percent of all revenue reported by charitable organizations for 2005. Examples of organizations in the health category are hospitals; nursing facilities; health support services, such as blood banks and emergency services; health care financing activities; substance abuse treatment services; organizations active in the prevention or treatment of diseases; and medical research. Program service revenue was the dominant source of income for health organizations, accounting for 87 percent of total revenue. The education program category, which includes colleges and universities, elementary and secondary schools, correspondence schools, libraries, and educational testing services, ranked a close second in terms of assets, with $744.5 billion. At $243.1 billion, total revenue reported by these organizations was considerably less than those in the health category. The largest NTEE category in terms of returns filed comprised human service organizations, which accounted for 38 percent of all Forms 990 and 990EZ filed for 2005. This category comprises organizations in several classifications performing a broad range of services focused on specific needs within the community: housing and shelter programs; job 8 training and placement services; public safety, disaster preparedness, and relief services; recreation and sports programs; crime prevention and legal services; and multipurpose organizations which provide a broad range of social or human services to individuals and families. Program service revenue ($86.3 billion) and contributions, gifts, and grants received ($70.1 billion) together represented 91 percent of the total revenue reported by these organizations. Labor and Agricultural Organizations TaxExempt under IRC Section 501(c)(5) Internal Revenue Code section 501(c)(5) grants tax exemption to both labor and agricultural organizations.8 The IRS defines a labor organization as “an association of workers who have combined to protect and promote the interests of the members by bargaining collectively with their employers to secure better working conditions.”9 Examples of labor organizations include labor unions, job training funds, professional societies, and certain member-funded pension plans. Per IRS regulations, the activities of agricultural organizations “involve raising livestock, forestry, cultivating land, raising and harvesting crops or aquatic resources, cultivating useful or ornamental plants, and similar pursuits.”10 Farm bureaus and 274 Though the text of IRC Section 501(c)(5) specifically cites ‘labor, agricultural, and horticultural organizations,” horticulture is considered a subset of agriculture. Therefore, throughout this article, the organizations will be referred to as “labor and agricultural.” 9 Internal Revenue Service Publication 557, “Tax-Exempt Status for Your Organization,” page 47. 10 Ibid. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 granges, agricultural fairs, and animal husbandry programs are examples of agricultural organizations. To be granted exempt status under section 501(c)(5), an organization must meet two requirements. Its goal must be to better the conditions of workers, improve the grades of their products, and develop a higher degree of efficiency in their respective occupations. Additionally, its net earnings may not inure to the benefit of any member of the organization. This second requirement applies to nonprofit charities, as well as to all other organizations exempt under IRC section 501(c). Unlike nonprofit charitable organizations, labor and agricultural organizations may legally particpate in some political activity on behalf of, or in opposition to, candidates for public office. They may also engage in an unlimited amount of lobbying, provided that the lobbying is related to the organization’s exempt purpose. In most cases, a donor’s contribution to one of these organizations is not tax-deductible. However, it may be deductible as a trade or business expense, if it is ordinary and necessary in the conduct of the taxpayer’s trade or business. Highlights of Labor and Agricutural Organization Financial Data Labor and agricultural organizations exempt under IRC section 501(c)(5) filed 19,837 Forms 990 and 990-EZ for Tax Year 2005. This figure represents just a fraction of the total number of active 501(c)(5) organizations recognized by the IRS. Organizations with total gross receipts below the filing threshold and noncompliant organizations comprise the differ- Figure F Sources of Revenue for Labor and Agricultural Organizations, by Asset Size, Tax Year 2005 100% 80% 60% 40% 20% 0% Under $100,000 [1] $100,000 under $500,000 $500,000 under $1,000,000 under $1,000,000 $10,000,000 Asset size $10,000,000 under $50,000,000 or more $50,000,000 Source of revenue Contributions, gifts, and grants Program service revenue Membership dues Other [1] Includes returns with zero assets or assets not reported. NOTES: Data are from Forms 990 and 990-EZ for organizations that are tax-exempt under Internal Revenue Code section 501(c)(5) and exclude most organizations with receipts less than $25,000. 275 Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Figure G Selected Items for Labor and Agricultural Organizations, by Type of Organization, Tax Year 2005 [All figures are estimates based on samples—money amounts are in millions of dollars] Type of organization Number of returns (1) 19,837 14,260 2,054 620 437 429 329 777 250 681 Total assets (2) 29,679 20,529 2,124 523 1,002 445 255 331 3,035 1,434 Total revenue (3) 20,682 16,675 595 672 366 209 241 223 937 764 efit plans ranked a distant second in terms of assets, with $3.0 billion, despite a relatively small number of filers.11 Section 501(c)(5) agricultural-related programs and organizations together filed over 3,500 information returns and reported over $1.4 billion in total revenue for Tax Year 2005. Total Labor unions Farm bureaus and granges Professional societies and associations Agricultural programs Job training funds Fairs Animal husbandry Retirement and benefit plans Other 501(c)(5) organizations Summary For 2005, nonprofit charitable organizations (excluding private foundations) tax-exempt under section 501(c)(3) reported $2.2 trillion in total assets and $1.3 trillion in revenue. The number of returns filed by these organizations was 286,615, including both Form 990 and the shorter Form 990-EZ. Program service revenue, the fees received for the charitable programs conducted by tax-exempt organizations, was $852.6 billion for Tax Year 2005. It represented more than two-thirds of the total revenue reported by charitable organizations. A second source of revenue, contributions, gifts, and grants, which totaled $276.3 billion, accounted for more than one-half of the total revenue of organizations with asset holdings of less than $1 million dollars, but a much smaller share of the total revenue of the larger organizations. Using the National Taxonomy of Exempt Entities codes (which classify organizations by institutional purpose and major programs and activities), health care was the predominant major category, accounting for 38 percent of assets and 56 percent of total revenue reported by nonprofit charitable organizations. Labor and agricultural organizations exempt under IRC section 501(c)(5) filed 19,837 information returns with the IRS, on which they reported $29.7 billion in assets and $20.7 billion in revenue. Labor unions represented the bulk of section 501(c)(5) filers, reporting $16.8 billion in revenue on 14,260 Forms 990 and 990-EZ. NOTES: Data are from both Forms 990 and 990-EZ for organizations that are tax-exempt under Internal Revenue Code section 501(c)(5) and exclude most organizations with receipts less than $25,000. Detail may not add to totals because of rounding. ence. Labor and agricultural organizations that filed information returns reported total assets of $29.7 billion and total revenue of $20.7 billion for Tax Year 2005. Figure F shows the sources of revenue for 501(c)(5) labor and agricultural organizations by size of total assets. When compared to Figure C, the equivalent chart for 501(c)(3) charitable organizations, similarities and differences between the two types of organizations emerge. Figure F shows that labor and agricultural organizations, regardless of their size, rely heavily on membership dues as a source of revenue. In contrast, less than 1 percent of nonprofit charitable organizations’ overall revenue came from membership dues. For both types of organizations, program service revenue represented a larger portion of total revenue as the size of the organization increased. For the largest 501(c)(3) organizations (those with over $50 million assets), program service income accounted for three-fourths of total revenue. For labor and agricultural organizations of the same size, it represented a third of total revenue. Figure G shows data for IRC section 501(c)(5) labor and agricultural organizations classified by type. By all measures, labor unions dominate the universe of 501(c)(5) organizations, with 72 percent of the returns filed, nearly 70 percent of total assets, and 81 percent of revenue reported. Retirement and ben276 Data Sources and Limitations The statistics in this article are based on a sample of the Tax Year 2005 Forms 990, Return of Organization Exempt From Income Tax, and Forms 990-EZ, Short Form Return of Organization Exempt From Income Tax. Organizations were required to file the 2005 form when their accounting periods ended any time between December 31, 2005, and November 30, 2006. The sample did not include private founda- 11 Most tax-exempt retirement and benefit plans are described by IRC section 501(c)(9). However, some plans are covered by section 501(c)(5) as long as they are established, maintained, and funded by the dues of the organization’s members and do not accept employer contributions. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Figure H Coefficient of Variation for Selected Items, by Selected Internal Revenue Code Section, Tax Year 2005 Percentages Type and size of organization Number of returns (1) All 501(c)(3) organizations [1] Large organizations [2] Medium organizations [3] Small organizations [4] All 501(c)(4) organizations All 501(c)(5) organizations Large organizations [5] Medium organizations [3] Small organizations [4] All 501(c)(6) organizations All 501(c)(7) organizations All 501(c)(8) organizations All 501(c)(9) organizations 0.08 0.79 1.21 1.58 4.35 5.14 0.00 3.20 5.71 3.92 5.07 9.00 7.33 Total assets (2) 0.06 0.11 0.57 2.66 0.46 1.42 0.00 4.00 11.90 0.88 2.03 0.28 0.26 Total revenue (3) 0.42 0.36 2.03 5.07 0.73 2.63 0.00 5.59 15.00 2.13 2.82 3.85 3.34 [1] Excludes private foundations, most chuches, and certain other types of religious organizations. [2] Large 501(c)(3) organizations are those with assets greater than or equal to $10 million. [3] Medium organizations are those with assets greater than or equal to $100,000 but less than $10 million. [4] Small organizations are those with assets less than $100,000. [5] Large 501(c)(5) organizations, those with assets greater than or equal to $10 million, were sampled at a rate of 100 percent and, therefore, have no sample variation. NOTE: Includes data from Forms 990 and 990-EZ and excludes most organizations with receipts less than $25,000. tions, which were required to file Form 990-PF. Most churches and certain other types of religious organizations were also excluded from the sample because they were not required to file Form 990 or Form 990-EZ. The sample included only those returns with average receipts of more than $25,000, the filing threshold. The sample design was split into two parts: the first sampling frame contained all returns filed by organizations exempt under section 501(c)(3); the second sampling frame comprised a pool of all returns filed by organizations exempt under sections 501(c)(4) through (9). Organizations tax-exempt under other Code sections were excluded from the sample frames. The data presented were obtained from returns as originally filed with the Internal Revenue Service. They were subjected to comprehensive testing and correction procedures in order to improve statistical reliability and validity. However, in most cases, changes made to the original return as a result of either administrative processing or taxpayer amendment were not incorporated into the database. The two samples were classified into strata based on the size of end-of-year total assets, with each stratum sampled at a different rate. For section 501(c)(3) organizations, a sample of 15,862 returns was selected from a population of 290,094. Sampling rates ranged from 1.24 percent for organizations reporting total assets less than $500,000 to 100 percent for organizations with total assets of $50,000,000 or more. The second sample contained 6,890 records selected from the population of 112,128 returns filed by organizations exempt under sections 501(c)(4) through (9). Sampling rates ranged from 1.11 percent for organizations reporting total assets less than $150,000 to 100 percent for organizations with assets of $10,000,000 or more. The filing populations for these organizations included some returns of terminated organizations, returns of inactive organizations, duplicate returns, and returns of organizations filed with tax periods prior to 2005. However, these returns were excluded from the final sample and the estimated population counts. Because the data are based on samples, they are subject to sampling error. In order to use these statistics properly, the magnitude of the sampling error, measured by the coefficient of variation (CV), should be taken into account. Figure H shows CVs for selected financial data. A discussion of methods for evaluating nonsampling error can be found in SOI Sampling Methodology and Data Limitations in the back of this issue. 277 Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Table 1. Form 990 Returns of 501(c)(3) Organizations: Balance Sheet and Income Statement Items, by Asset Size, Tax Year 2005 [All figures are estimates based on samples—money amounts are in thousands of dollars] Asset size Item Total Under $100,000 $100,000 under $500,000 under [1] $500,000 $1,000,000 (2) 63,069 2,548,300 1,215,745 581,994 128,377 17,236 51,007 9,976 8,494 45,888 32,862 42,062 48,905 14,444 303,349 47,960 1,310,389 334,891 13,885 70,448 104,225 0 173,232 613,708 1,237,910 11,614,081 6,537,723 4,616,193 365,867 1,555,663 3,711,903 460,705 16,155 4,217 18,750 31,259 * 12,509 8,647 17,566 * 5,010 * 50,006 * 44,995 12,555 31,367 18,812 493,283 1,756,391 1,263,107 97,281 220,320 123,039 247,849 11,789,217 9,899,591 1,472,597 333,770 83,257 -175,137 (3) 62,030 15,676,513 3,348,718 4,058,632 823,791 203,925 258,589 28,792 150,196 161,873 135,450 1,435,980 667,515 452,555 3,665,049 285,448 4,139,659 1,065,690 89,323 358,532 103,124 0 1,825,874 697,116 11,536,854 23,593,036 12,076,436 6,538,409 675,221 4,862,806 9,065,963 783,527 103,774 65,657 99,516 131,746 32,230 35,057 26,363 17,299 433,738 416,439 9,065 48,829 39,764 740,024 2,141,304 1,401,280 322,117 653,818 331,701 274,598 22,274,050 18,689,536 3,118,536 451,151 14,826 1,318,985 (4) 27,011 19,030,165 2,450,247 4,142,008 890,341 233,840 351,389 * 30,492 371,564 203,617 142,192 2,534,947 785,608 706,308 5,789,835 397,776 4,101,713 879,016 131,124 324,912 12,954 0 2,006,953 746,754 14,928,452 16,413,752 7,335,215 4,100,213 180,173 3,054,829 7,216,916 514,029 138,566 95,826 88,626 150,556 61,930 21,004 54,386 39,081 771,818 732,737 15,305 314,362 299,057 328,778 1,120,788 792,010 348,555 750,498 401,944 271,847 15,422,574 12,776,053 2,323,674 294,486 28,361 991,178 $1,000,000 under $10,000,000 (5) 56,717 184,239,094 10,997,098 21,867,602 10,036,506 4,276,760 3,681,265 91,449 4,412,052 1,552,104 1,750,383 33,147,438 6,718,642 9,195,655 68,448,910 8,063,231 68,580,529 13,847,921 * 1,526,007 4,527,471 * 441,681 4,008,483 35,511,484 8,717,481 115,658,565 154,081,806 66,043,520 27,159,776 2,969,269 35,914,475 76,804,825 1,991,385 956,612 1,152,441 484,130 921,566 437,436 266,112 1,654,485 1,019,562 12,627,628 11,608,066 634,923 1,737,162 1,102,238 1,178,992 2,349,419 1,170,427 1,497,499 3,871,575 2,374,076 2,051,804 145,622,969 123,919,580 18,241,732 2,849,174 612,483 8,458,838 $10,000,000 under $50,000,000 (6) 11,852 253,240,918 9,018,263 21,929,075 13,802,120 7,697,596 3,140,535 33,603 5,487,514 1,758,098 2,453,925 65,144,661 7,095,715 16,447,716 83,791,741 15,440,356 95,230,819 18,144,917 1,555,372 8,546,714 44,044 19,563,953 32,008,150 15,367,668 158,010,099 169,425,201 49,741,632 27,332,624 2,260,662 20,148,346 106,476,654 2,201,923 1,047,563 2,099,659 417,044 842,815 425,771 409,398 3,012,493 2,064,982 27,804,964 25,739,982 947,511 3,450,078 2,502,567 355,131 1,015,039 659,909 1,432,897 3,462,755 2,029,857 2,230,807 156,894,318 133,712,905 19,781,958 2,434,575 964,880 12,530,883 $50,000,000 or more (7) 5,567 1,764,669,319 22,225,582 95,075,227 88,692,768 29,857,201 5,411,037 240,808 69,400,059 8,743,807 16,806,074 677,919,430 17,665,400 201,806,014 420,819,513 110,006,399 657,071,557 115,073,457 8,143,981 29,104,219 227,134 262,071,101 100,677,281 141,774,385 1,107,597,763 874,949,657 133,088,498 70,601,159 15,173,216 47,314,123 648,766,700 2,360,540 4,743,397 18,462,530 1,527,903 3,505,745 1,977,842 6,341,287 42,964,252 38,693,241 574,550,700 535,857,459 4,271,011 8,462,523 4,191,512 329,732 994,254 664,522 1,889,467 4,400,203 2,510,737 14,475,351 783,345,507 678,136,261 94,344,735 6,708,250 4,156,261 91,604,150 (1) Number of returns Total assets Cash Savings and temporary cash investments Accounts receivable (net) Pledges receivable (net) Grants receivable Receivables due from officers, etc. Other notes and loans receivable Inventories for sale or use Prepaid expenses and deferred charges Investments in securities Investments in land, buildings, and equipment Other investments Land, buildings, and equipment for charitable purposes Other assets Total liabilities Accounts payable Grants payable Support and revenue designated for future periods Loans from officers, etc. Tax-exempt bond liabilities Mortgages and other notes payable Other liabilities Net assets Total revenue Total contributions, gifts, and grants received Contributions received from direct public support Contributions received from indirect public support Government grants Program service revenue Membership dues and assessments Interest on savings and temporary cash investments Dividends and interest from securities Net rental income (loss) Gross rents Rental expenses Other investment income (loss) Total gain (loss) from sales of assets Gain (loss), sales of securities Gross amount from sales Cost or other basis and sales expense Gain (loss), sales of other assets Gross amount from sales Cost or other basis and sales expense Net income (loss), special events and activities Gross revenue Direct expenses Gross profit (loss), sales of inventories Gross sales minus returns and allowances Cost of goods sold Other revenue (loss) Total expenses [2] Program services Management and general Fundraising Payments to affiliates Excess of revenue over expenses (net) 226,246 2,239,404,309 49,255,652 147,654,538 114,373,902 42,286,559 12,893,822 435,121 79,829,878 12,465,388 21,320,886 780,224,518 32,981,784 228,622,691 582,818,397 134,241,170 830,434,665 149,345,891 11,459,693 42,932,297 933,162 285,643,537 172,202,974 167,917,112 1,408,969,643 1,250,077,533 274,823,023 140,348,374 21,624,408 112,850,241 852,042,962 8,312,109 7,006,067 21,880,330 2,635,969 5,583,687 2,947,718 7,081,506 47,729,545 41,839,175 616,238,853 574,399,679 5,890,371 14,044,320 8,153,949 3,425,940 9,377,196 5,951,255 5,587,817 13,359,170 7,771,354 19,552,256 1,135,348,635 977,133,926 139,283,231 13,071,406 5,860,069 114,728,897 278 * Estimate should be used with caution because of the small number of sample returns on which it is based. [1] Includes returns with zero assets or assets not reported. [2] The differences between "total expenses" shown in this table and "total functional expenditures" shown in Table 2 are due to payments to affiliates, which are not considered functional expenditures. NOTES: Data exclude private foundations, most organizations with receipts less than $25,000, most churches, and certain other types of religious organizations. Detail may not add to totals because of rounding. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Table 2. Form 990 Returns of 501(c)(3)-(9) Organizations: Total Functional Expenditures, by Code Section, Tax Year 2005 [All figures are estimates based on samples—money amounts are in thousands of dollars] Internal Revenue Code section Item 501(c)(3) [1] (1) Total functional expenditures [2] Grants and allocations Specific assistance to individuals Benefits paid to or for members Compensation of officers, directors, or trustees Other salaries and wages Pension plan contributions Other employee benefits Payroll taxes Professional fundraising fees Accounting fees Legal fees Supplies Telephone Postage and shipping Occupancy Equipment rental and maintenance Printing and publications Travel Conferences, conventions, and meetings Interest Depreciation and depletion Other expenses 1,129,488,565 74,876,196 10,696,633 6,401,191 17,358,409 380,539,069 18,109,687 53,667,710 26,747,584 675,197 1,869,623 2,717,339 95,860,894 4,482,127 3,960,413 35,403,600 15,338,290 6,665,667 9,753,642 4,357,312 18,804,272 45,913,185 295,290,499 501(c)(4) (2) 70,781,946 1,764,871 1,160,267 21,875,976 455,581 6,009,143 800,036 1,162,726 268,534 99,455 106,768 196,166 384,033 128,881 438,644 904,639 292,580 475,672 214,737 195,937 2,430,858 1,118,829 30,297,612 501(c)(5) (3) 17,250,804 538,917 42,782 1,719,190 1,427,920 3,497,355 734,598 933,455 424,379 64,982 93,693 422,873 157,157 139,534 117,862 518,290 123,261 245,876 451,476 354,520 107,903 352,047 4,782,731 501(c)(6) (4) 31,494,439 689,667 85,797 997,561 1,966,061 5,936,575 534,327 1,047,558 526,676 31,253 142,295 545,258 246,507 216,553 327,497 972,626 292,030 966,760 791,134 2,178,977 127,040 560,055 12,312,231 501(c)(7) (5) 10,769,345 61,297 * 659 11,260 156,830 3,661,031 62,440 378,562 447,875 6,143 57,618 28,533 363,562 50,166 41,000 1,320,398 325,855 87,481 38,418 43,351 244,024 1,003,093 2,379,745 501(c)(8) (6) 11,488,610 559,641 151,396 7,940,193 91,723 566,336 105,429 367,538 89,062 * 9,570 23,999 25,284 66,209 25,336 18,798 203,580 32,623 46,057 26,875 41,884 16,576 116,870 963,622 501(c)(9) (7) 128,869,234 984,432 855,414 109,740,035 592,680 635,347 95,640 1,596,405 78,410 * 968 102,472 141,702 31,510 18,513 60,181 106,766 30,767 37,939 12,661 22,284 15,709 64,484 13,644,915 * Estimate should be used with caution because of the small number of sample returns on which it is based. [1] Excludes private foundations, most churches, and certain other types of religious organizations. [2] The differences between "total functional expenditures" shown in this table and "total expenses" shown in Tables 1 and 3 are due to payments to affiliates, which are not considered functional expenditures. NOTES: Data exclude most organizations with receipts less than $25,000. Detail may not add to totals because of rounding. 279 Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Table 3. Form 990 Returns of 501(c)(3)-(9) Organizations: Balance Sheet and Income Statement Items, by Code Section, Tax Year 2005 [All figures are estimates based on samples—money amounts are in thousands of dollars] Internal Revenue Code section Item 501(c)(3) [1] (1) Number of returns Total assets Cash Savings and temporary cash investments Accounts receivable (net) Pledges receivable (net) Grants receivable Receivables due from officers, etc. Other notes and loans receivable Inventories for sale or use Prepaid expenses and deferred charges Investments in securities Investments in land, buildings, and equipment Other investments Land, buildings, and equipment for charitable purposes Other assets Total liabilities Accounts payable Grants payable Support and revenue designated for future periods Loans from officers, etc. Tax-exempt bond liabilities Mortgages and other notes payable Other liabilities Net assets Total revenue Total contributions, gifts, and grants received Contributions received from direct public support Contributions received from indirect public support Government grants Program service revenue Membership dues and assessments Interest on savings and temporary cash investments Dividends and interest from securities Net rental income (loss) Gross rents Rental expenses Other investment income (loss) Total gain (loss) from sales of assets Gain (loss), sales of securities Gross amount from sales Cost or other basis and sales expense Gain (loss), sales of other assets Gross amount from sales Cost or other basis and sales expense Net income (loss), special events and activities Gross revenue Direct expenses Gross profit (loss), sales of inventories Gross sales minus returns and allowances Cost of goods sold Other revenue (loss) Total expenses [2] Program services Management and general Fundraising Payments to affiliates Excess of revenue over expenses (net) 226,246 2,239,404,309 49,255,652 147,654,538 114,373,902 42,286,559 12,893,822 435,121 79,829,878 12,465,388 21,320,886 780,224,518 32,981,784 228,622,691 582,818,397 134,241,170 830,434,665 149,345,891 11,459,693 42,932,297 933,162 285,643,537 172,202,974 167,917,112 1,408,969,643 1,250,077,533 274,823,023 140,348,374 21,624,408 112,850,241 852,042,962 8,312,109 7,006,067 21,880,330 2,635,969 5,583,687 2,947,718 7,081,506 47,729,545 41,839,175 616,238,853 574,399,679 5,890,371 14,044,320 8,153,949 3,425,940 9,377,196 5,951,255 5,587,817 13,359,170 7,771,354 19,552,256 1,135,348,635 977,133,926 139,283,231 13,071,406 5,860,069 114,728,897 501(c)(4) (2) 16,914 92,167,195 2,837,109 8,552,447 5,687,977 118,564 202,360 * 36,765 27,576,662 1,236,912 1,640,080 20,952,025 2,602,290 4,519,890 11,203,609 5,000,506 49,723,209 9,999,915 478,734 2,394,718 * 6,091 7,314,285 23,092,092 6,437,374 42,443,986 73,862,875 4,686,804 1,676,403 235,675 2,774,726 61,030,857 2,687,993 505,113 616,649 216,154 342,158 126,004 706,873 1,088,781 673,095 15,204,226 14,531,131 415,687 1,110,674 694,987 311,800 1,120,614 808,813 185,692 556,930 371,238 1,826,157 70,928,940 63,263,844 7,107,133 410,969 146,993 2,933,935 501(c)(5) (3) 13,718 29,273,249 1,927,804 5,520,278 1,232,189 * 6,199 * 17,891 1,487 310,640 106,730 271,382 11,986,295 483,981 1,598,473 5,035,943 773,957 6,932,898 2,685,904 * 41,988 252,378 * 3,209 * 27,250 2,064,672 1,857,498 22,340,352 20,358,194 715,212 311,561 116,887 286,764 4,172,452 13,245,368 258,176 370,961 86,923 198,267 111,344 53,106 322,918 271,264 8,282,599 8,011,335 51,654 102,475 50,821 19,472 82,733 63,260 13,911 53,546 39,636 1,099,696 19,371,039 [3] [3] [3] 2,120,235 987,155 501(c)(6) (4) 22,851 54,405,050 3,251,598 9,629,395 3,421,454 172,851 97,983 16,072 1,156,083 187,634 900,154 23,677,456 563,932 4,760,358 4,341,761 2,228,320 29,802,212 6,131,948 141,349 4,234,153 * 612 * 54,330 2,709,648 16,530,171 24,602,838 34,604,688 2,658,799 981,389 121,611 1,555,799 14,361,734 13,175,458 472,682 817,511 44,619 164,131 119,513 58,249 348,214 204,720 24,461,202 24,256,482 143,494 229,514 86,019 211,008 678,084 467,076 213,401 358,922 145,521 2,243,013 31,638,751 [3] [3] [3] 144,309 2,965,938 501(c)(7) (5) 13,564 21,811,434 1,013,232 1,696,785 1,165,059 13,263 * 757 9,623 157,361 246,185 222,278 537,186 1,372,043 225,787 14,779,510 372,365 7,313,600 1,018,789 * 4,631 758,264 * 10,586 * 202 4,724,522 796,606 14,497,834 11,128,233 121,662 101,504 4,816 * 15,342 1,948,831 6,593,311 62,255 18,114 53,089 113,277 60,188 3,881 72,044 23,515 283,269 259,754 48,529 96,229 47,700 70,197 259,020 188,823 1,809,373 3,628,827 1,819,454 375,476 10,794,788 [3] [3] [3] 25,442 333,445 501(c)(8) (6) 5,514 83,507,893 569,730 3,819,626 107,053 * 1,270 * 330 * 594 458,032 38,853 472,218 55,740,691 341,747 19,731,522 1,403,512 822,715 73,307,775 255,428 * 55,530 62,281 0 * 17,509 274,340 72,642,688 10,200,118 12,294,813 386,405 87,330 259,416 * 39,660 8,184,866 348,942 72,907 2,445,025 32,651 53,034 20,384 20,938 213,822 171,105 1,253,792 1,082,688 42,717 69,258 26,541 361,081 703,410 342,329 152,332 383,117 230,785 75,844 11,505,962 [3] [3] [3] 17,352 788,851 501(c)(9) (7) 6,419 156,245,135 2,697,300 19,113,727 11,561,744 * 314 244,623 *7 284,358 7,098 222,884 104,994,290 145,604 9,920,412 389,294 6,663,479 30,707,343 16,850,539 41,960 353,753 * 64 0 193,646 13,267,381 125,537,792 131,990,285 0 0 0 0 118,234,020 2,935,233 772,285 2,894,669 2,017 12,073 10,056 1,320,855 4,649,702 4,631,805 135,695,818 131,064,014 17,897 242,396 224,499 * 2,751 * 19,480 * 16,729 -* 31 * 11,452 * 11,483 1,178,785 128,941,063 [3] [3] [3] 71,829 3,049,223 * Estimate should be used with caution because of the small number of sample returns on which it is based. [1] Excludes private foundations, most churches, and certain other types of religious organizations. 280 [2] The differences between "total expenses" shown in this table and "total functional expenditures" shown in Table 2 are due to payments to affiliates, which are not considered functional expenditures. [3] Not required to be reported. NOTES: Data exclude most organizations with receipts less than $25,000. Detail may not add to totals because of rounding. Charities, Labor and Agricultural, and Other Tax-Exempt Organizations, 2005 Statistics of Income Bulletin | Fall 2008 Table 4. Form 990-EZ Returns of 501(c)(3)-(9) Organizations: Selected tems, by Code Section, Tax Year 2005 [All figures are estimates based on samples—money amounts are in thousands of dollars] Internal Revenue Code section Item 501(c)(3) [1] (1) Number of returns Total assets Cash, savings, and investments Land and buildings (net) Other assets Total liabilities Net assets Total revenue Contributions, gifts, and grants Program service revenue Dues and assessments Investment income (loss) Gain (loss) from sales of assets Gross amount from sales Cost or other basis and sales expense Net income (loss), special events and activities Gross revenue Direct expenses Gross profit (loss), sales of inventories Gross sales minus returns and allowances Cost of goods sold Other revenue (loss) Total expenses Grants paid Benefits paid to or for members Salaries and compensation Professional fees Occupancy, rent, and utilities Printing, publications, and postage Other expenses Excess of revenue over expenses (net) 60,369 2,482,194 1,815,861 394,920 271,413 199,892 2,282,302 2,811,953 1,469,440 595,383 245,911 30,808 11,290 45,734 34,444 281,128 686,393 405,263 62,745 174,305 111,559 115,246 2,559,505 367,834 40,782 410,405 237,427 272,587 97,971 1,132,491 252,448 501(c)(4) (2) 9,918 475,325 341,780 112,721 20,823 42,355 432,970 392,007 99,417 68,966 113,824 11,323 * 494 * 4,628 * 4,134 79,626 191,274 111,648 3,634 14,020 10,386 14,721 379,321 87,483 27,930 16,145 28,497 28,757 12,529 177,978 12,685 501(c)(5) (3) 6,119 406,100 367,400 * 29,232 9,469 42,233 363,867 323,359 28,786 21,035 241,068 5,286 * 1,201 * 2,528 * 1,326 9,131 25,713 16,582 * 401 * 1,438 * 1,037 16,449 308,514 53,481 13,296 67,103 17,915 20,683 12,637 123,399 14,846 501(c)(6) (4) 7,694 325,671 310,112 * 10,032 5,527 23,329 302,342 358,133 44,384 104,094 170,984 4,796 0 0 0 9,277 50,247 40,970 * 924 * 2,402 * 1,478 23,673 355,569 17,719 16,064 46,389 66,137 11,241 21,344 176,675 2,563 501(c)(7) (5) 7,063 397,641 204,569 154,511 38,561 43,437 354,204 297,196 28,280 65,910 157,431 10,013 * 69 * 14,020 * 13,951 12,968 47,671 34,702 8,708 26,337 17,629 13,816 280,423 9,968 7,355 27,108 20,088 82,901 14,620 118,383 16,774 501(c)(8) (6) 1,366 92,216 68,286 * 22,926 * 1,003 * 2,034 90,182 65,105 8,892 * 11,670 11,608 1,065 0 0 0 * 13,977 * 25,122 * 11,145 * 564 * 1,368 * 804 * 17,328 59,335 13,705 * 3,889 * 2,083 * 315 11,732 1,453 26,157 5,770 501(c)(9)* (7) 169 7,505 7,505 0 0 0 7,505 6,822 0 4,157 2,609 55 0 0 0 0 0 0 0 0 0 0 5,661 0 2,214 211 10 80 16 3,130 1,161 * Estimate(s) should be used with caution because of the small number of sample returns on which they are based. [1] Excludes private foundations, most churches, and certain other types of religious organizations. NOTES: Organizations with end-of-year total assets under $250,000 and gross receipts under $100,000 could elect to file Forms 990-EZ rather than Forms 990. Data exclude most organizations with receipts less than $25,000. Detail may not add to totals because of rounding. 281