1992 Instr[366]

Contents Page

Department of the Treasury Part III—Statement of Program

Service Accomplishments 13

Internal Revenue Service

Part IV—Balance Sheets 13

Part V—List of Officers, Directors,

Instructions for Form 990 Trustees, and Key Employees

Part VI—Other Information

15

16

Return of Organization Exempt From Income Tax Part VII—Analysis of Income-

Producing Activities 17

Under section 501(c) of the Internal Revenue Code (except black lung Part VIII—Relationship of Activities

benefit trust or private foundation) or section 4947(a)(1) charitable trust to the Accomplishment of

(Section references are to the Internal Revenue Code unless otherwise indicated. ) Exempt Purposes 18

Part IX—Information Regarding

Paperwork Reduction Act Notice.—We ask for the information on this form to carry out the Taxable Subsidiaries 18

Internal Revenue laws of the United States. You are required to give us the information. We Exclusion Codes 19

need it to ensure that you are complying with these laws.

A. Who Must File Form 990.—

The time needed to complete and file this form and related schedules will vary depending on

individual circumstances. The estimated average times are: 1. Filing tests.—If the organization does

not meet any of the exceptions from filing

Copying, listed in General Instruction C and its annual

Learning about Preparing assembling, and gross receipts are normally more than

the law or the the sending the form $25,000 (see General Instruction C11 below),

Form Recordkeeping form form to the IRS it has a filing obligation. The organization can

990 85 hr., 23 min. 15 hr., 30 min. 20 hr., 22 min. 48 min. meet this obligation by filing Form 990. If, for

Sch. A 43 hr., 32 min. 8 hr., 56 min. 10 hr., 2 min. -0- any year, the organization’s gross receipts

(Form 990) during the year are less than $100,000 and its

total assets at end of year are less than

If you have comments concerning the accuracy of these time estimates or suggestions for $250,000, it may file Form 990EZ, Short

making these forms more simple, we would be happy to hear from you. You can write to both Form Return of Organization Exempt From

the Internal Revenue Service, Washington, DC 20224, Attention: IRS Reports Clearance Income Tax, instead of Form 990. Even if the

Officer, T:FP; and the Office of Management and Budget, Paperwork Reduction Project organization meets this dual test, it can

(1545-0047), Washington, DC 20503. DO NOT send the form to either of these offices. Instead, always file a Form 990. However, if the

see General Instruction H for information on where to file it. organization’s gross receipts or assets are

above these limits, it must file Form 990.

2. Section 501(a), (e), (f), and (k)

Items To Note Contents Page

organizations.—Except for those types of

● General Instructions 1–5

● An organization may use Form 990 (or organizations listed in General

Form 990EZ) to transmit any required A. Who Must File Form 990 1 Instruction C, an annual return on Form 990

elections to the IRS. (See “Purpose of Form” B. Exempt Organization Reference (or Form 990EZ) is required from every

below.) Chart 2 organization exempt from tax under section

● An organization must disclose joint costs C. Organizations Not Required To File 501(a), including foreign organizations and

that relate to a combined educational Form 990 2 cooperative service organizations described in

campaign and fundraising solicitation if any sections 501(e) and (f), and child care

D. Forms and Publications To File or Use 2 organizations described in section 501(k).

portion of such costs is reported as program

service expenses. (See Part II instructions.) E. Use of Form 990 To Satisfy State 3. Section 4947(a)(1) nonexempt

Reporting Requirements 3 charitable trusts.—Any nonexempt charitable

● An organization that together with all

related organizations paid any of its officers, F. Other Forms as Partial Substitutes trust (described in section 4947(a)(1)) not

directors, trustees, or key employees more for Form 990 4 treated as a private foundation is also

than $100,000 in total compensation, of G. Accounting Period Covered 4 required to file Form 990 (or Form 990EZ), if

which more than $10,000 was provided by its gross receipts are normally more than

H. When and Where To File 4

the related organizations, must attach a $25,000. See General Instruction D7 for

I. Extension of Time To File 4 information about possible relief from filing

schedule reporting that compensation. (See

Part V instructions.) J. Amended Return/Final Return 4 Form 1041, U.S. Fiduciary Income Tax

K. Penalties 4 Return.

General Instructions L. Public Inspection of Completed 4. Exemption application pending.—If the

Exempt Organization Returns and organization’s application for exemption is

Note: An organization’s completed Form 990

Approved Exemption Applications 4 pending, check the box in item G at the top

(except for the schedule of contributors) is

of page 1 of the return and complete the

available for public inspection as required by M. Solicitations of Nondeductible return.

section 6104. Contributions 5

5. If the organization received a Form

Section 501(c)(3) organizations and N. Disclosures Regarding Certain 990 Package.—If the organization is not

section 4947(a)(1) charitable trusts not Information and Services Furnished 5 required to file Form 990 because its gross

treated as a private foundation must also O. Disclosures Regarding Certain receipts are normally not more than $25,000

attach a completed Schedule A (Form 990) Transactions and Relationships 5 (see General Instruction C11 below), we ask

to their Form 990 (or Form 990EZ).

P. Erroneous Backup Withholding 5 that the organization file anyway if we sent it

Purpose of Form.—Form 990 is used by a Form 990 Package with a preaddressed

tax-exempt organizations and nonexempt Q. Group Return 5

mailing label. Attach the label to the name

charitable trusts to provide the IRS with the R. Organizations in Foreign Countries and address space on the return (see Specific

information required by section 6033. and U.S. Possessions 5 Instructions). Check the box in item K in the

This form may be used to transmit ● Specific Instructions 6 area above Part I to indicate that the

elections that are required to be submitted to Part I—Statement of Revenue, organization’s gross receipts are not more

the IRS, such as the election to capitalize Expenses, and Changes in Net than $25,000; sign the return; and send it to

costs under section 266. Assets or Fund Balances 6 the service center for the organization’s area.

You do not have to complete Parts I through

Part II—Statement of Functional

IX of the return. By following this instruction,

Expenses 11

you will help us to update our records, and

Cat. No. 11283J

we will not have to contact the organization association of churches, an integrated b. Between one and three years old and

later to ask why no return was filed. If the auxiliary of a church (such as a men’s or averaged $30,000 or less in gross receipts

organization files a return this way, it will not women’s organization, religious school, during each of its first two tax years; or

be mailed a Form 990 Package in later years mission society, or youth group), or an c. Three years old or more and averaged

and need not file Form 990 (or Form 990EZ) internally supported, church-controlled $25,000 or less in gross receipts for the

again until its gross receipts normally exceed organization described in Rev. Proc. 86-23, immediately preceding three tax years

the $25,000 minimum, or it terminates or 1986-1 C.B. 564. (including the year for which the return would

undergoes a substantial contraction as 2. A school below college level affiliated be filed).

described in the instructions for line 79. with a church or operated by a religious

D. Forms and Publications To File or

6. Effect on contributions.— Organizations order.

Use.—

that are eligible to receive tax deductible 3. A mission society sponsored by, or

contributions are listed in Publication 78, affiliated with, one or more churches or 1. Schedule A (Form 990).— Organization

Cumulative List of Organizations described in church denominations, if more than half of Exempt Under Section 501(c)(3) (Except

Section 170(c) of the Internal Revenue Code the society’s activities are conducted in, or Private Foundation), 501(e), 501(f), 501(k), or

of 1986. An organization may be removed directed at persons in, foreign countries. Section 4947(a)(1) Charitable Trust. Filed with

from this listing if our records show that it is Form 990 (or Form 990EZ) for a section

4. An exclusively religious activity of any

required to file Form 990 (or Form 990EZ), but 501(c)(3) organization that is not a private

religious order.

it does not file a return or advise us that it is foundation (including an organization

no longer required to file. However, 5. A state institution whose income is described in section 501(e), 501(f), or 501(k)).

contributions to such an organization may excluded from gross income under section Also filed with Form 990 (or Form 990EZ) for

continue to be deductible by the general 115. a section 4947(a)(1) charitable trust not

public until the IRS publishes a notice to the 6. An organization described in section treated as a private foundation. An

contrary in the Internal Revenue Bulletin. 501(c)(1). Section 501(c)(1) organizations are organization is not required to file Schedule A

corporations organized under an Act of (Form 990) if its gross receipts are normally

B. Exempt Organization Congress that are: $25,000 or less (see General Instruction C11).

Reference Chart.— I.R.C. section

a. Instrumentalities of the United States, 2. Forms W-2 and W-3.—Wage and Tax

*Corporations organized under Act of

Congress 501(c)(1) and Statement, and Transmittal of Income and

Title Holding Corporations 501(c)(2) b. Exempt from Federal income taxes. Tax Statements.

*Organizations—Charitable, Religious, 7. A private foundation exempt under 3. Form 940.—Employer’s Annual Federal

Educational, Scientific, etc. 501(c)(3) Unemployment (FUTA) Tax Return.

section 501(c)(3) and described in section

Civic Leagues and Social Welfare

Organizations 501(c)(4) 509(a). (Required to file Form 990-PF, Return 4. Form 941.—Employer’s Quarterly

Labor, Agricultural, and Horticultural of Private Foundation.) Federal Tax Return. Used to report social

Organizations 501(c)(5) 8. A black lung benefit trust described in security, Medicare, and income taxes

Business Leagues, etc. 501(c)(6) section 501(c)(21). (Required to file Form withheld by an employer and social security

Social and Recreation Clubs 501(c)(7) 990-BL, Information and Initial Excise Tax and Medicare taxes paid by an employer.

Fraternal Beneficiary and Domestic Return for Black Lung Benefit Trusts and If income, social security, and Medicare

Fraternal Societies and Associations 501(c)(8) & (10) Certain Related Persons.) taxes that must be withheld are not withheld

Voluntary Employees’ Beneficiary or are not paid to the IRS, a 100% penalty

Associations 501(c)(9) 9. A stock bonus, pension, or profit-sharing

trust that qualifies under section 401. (See may apply. The penalty is 100% of such

Teachers’ Retirement Fund Associations 501(c)(11)

Form 5500, Annual Return/Report of unpaid taxes.

Benevolent Line Insurance Associations,

Mutual Ditch or Irrigation Companies, Employee Benefit Plan.) The 100% penalty may be imposed on all

Mutual or Cooperative Telephone 10. A religious or apostolic organization persons (including volunteers) who are

Companies, etc. 501(c)(12) determined by the IRS to be responsible for

described in section 501(d). (Required to file

Cemetery Companies 501(c)(13) collecting, accounting for, and paying over

Form 1065, U.S. Partnership Return of

State Chartered Credit Unions, Mutual these taxes, and who acted willfully in not

Reserve Funds 501(c)(14) Income.)

doing so.

Mutual Insurance Companies or 11. An organization whose annual gross

Associations 501(c)(15) receipts are normally $25,000 or less (but see 5. Form 990-T.—Exempt Organization

Cooperative Organizations To Finance Crop General Instruction A5). Business Income Tax Return. Filed separately

Operations 501(c)(16) for organizations with gross income of $1,000

Supplemental Unemployment Benefit

a. Calculating gross receipts.—Gross or more from business unrelated to the

Trusts 501(c)(17) receipts are the sum of lines 1d, 2, 3, 4, 5, organization’s exempt purpose.

Employee Funded Pension Trusts (created 6a, 7, 8a (both columns), 9a, 10a, and 11 of

before 6/25/59) Part I. The organization’s gross receipts are 6. Form 990-W.—Estimated Tax on

501(c)(18)

Organizations of Past or Present the total amount it received from all sources Unrelated Business Taxable Income for

Members of the Armed Forces 501(c)(19) & (23) during its annual accounting period, without Tax-Exempt Organizations.

Prepaid Group Legal Services Plans 501(c)(20) subtracting any costs or expenses. 7. Form 1041.—U.S. Fiduciary Income Tax

*Black Lung Benefit Trusts 501(c)(21) b. Acting as agent.—If a local chapter of a Return. Required of section 4947(a)(1)

Withdrawal Liability Payment Funds 501(c)(22) section 501(c)(8) fraternal organization charitable trusts that also file Form 990 (or

Title Holding Corporations or Trusts 501(c)(25) collects insurance premiums for its parent Form 990EZ). However, if such a trust does

*Religious and Apostolic Associations 501(d) lodge and merely sends those premiums to not have any taxable income under Subtitle A

Cooperative Hospital Service Organizations 501(e) the parent without asserting any right to use of the Code, it can file either Form 990 (or

Cooperative Service Organizations of the funds or otherwise deriving any benefit Form 990EZ) and need not file Form 1041 to

Operating Educational Organizations 501(f) meet its section 6012 filing requirement. If

from collecting them, the local chapter should

Child Care Organizations 501(k) this condition is met, complete question 92 of

not include the premiums in its gross

*See General Instruction C. Form 990 and do not file Form 1041, but

receipts. The parent lodge should report them

C. Organizations Not Required To File instead. The same treatment applies in other complete Form 990 in the normal manner. A

Form 990.—Note: Organizations not required situations in which one organization collects section 4947(a)(1) charitable trust that

to file this form with the IRS may nevertheless funds merely as an agent for another. normally has gross receipts of not more than

wish to use it to satisfy state reporting $25,000 (see General Instruction C11) and

c. $25,000 gross receipts test.—An has no taxable income under Subtitle A must

requirements. For details, see General

organization’s gross receipts are considered complete only the following items in the

Instruction E.

normally to be $25,000 or less if the heading of Form 990:

The following types of organizations organization is:

exempt from tax under section 501(a) do not Item

a. Up to a year old and has received, or

have to file Form 990 (or Form 990EZ) with A. Fiscal year (if applicable)

donors have pledged to give, $37,500 or less

the IRS:

during its first tax year; B. Name and address

1. A church, an interchurch organization of

local units of a church, a convention or C. Employer identification number



Page 2

F. Section 4947(a)(1) charitable trust box. transactions) in the course of a trade or submitted with the Form 990 filed with the

Also, complete question 92 and the business (as defined in section 162). IRS.

signature block on page 5. However, if the organization receives a Even if the Form 990 the organization files

8. Form 1096.—Annual Summary and charitable cash contribution in excess of with the IRS is accepted by the IRS as

Transmittal of U.S. Information Returns. $10,000, it is not subject to the reporting complete, a copy of the same return filed with

requirement since the funds were not a state will not fully satisfy that state’s filing

9. Form 1099 Series.—Information returns

received in the course of a trade or business. requirement if required information is not

for reporting payments such as dividends, provided, including any of the additional

interest, miscellaneous income (including 19. Form 8822.—Change of Address. Used

to notify the IRS of a change in mailing information discussed above, or if the state

medical and health care payments and determines that the form was not completed

nonemployee compensation), original issue address that occurs after the return is filed.

in accordance with the applicable Form 990

discount, patronage dividends, real estate 20. Publications.— instructions or supplemental state

transactions, acquisition or abandonment of Publication 525.—Taxable and Nontaxable instructions. If so, the organization may be

secured property, and distributions from Income. asked to provide the missing information or to

annuities, pensions, and profit-sharing and submit an amended return.

retirement plans. Publication 598.—Tax on Unrelated Business

Income of Exempt Organizations. 4. Use of audit guides may be

10. Form 1120-POL.—U.S. Income Tax required.—To ensure that all organizations

Publication 910.—Guide to Free Tax

Return for Certain Political Organizations. report similar transactions uniformly, many

Services.

11. Form 1128.—Application To Adopt, states require that contributions, gifts, and

Publication 1391.—Deductibility of Payments

Change, or Retain a Tax Year. grants on lines 1a through 1d in Part I and

Made to Charities Conducting Fund-Raising

12. Form 2758.—Application for Extension Events. functional expenses on lines 13, 14, and 15,

of Time To File Certain Excise, Income, and in Part II, be reported in accordance with

These publications and forms are available the AICPA industry audit guide, Audits of

Information, and Other Returns.

free at many IRS offices or by calling Voluntary Health and Welfare Organizations

13. Form 4506-A.—Request for Public 1-800-TAX-FORM (1-800-829-3676).

Inspection or Copy of Exempt Organization (New York, N.Y., AICPA, 1992), as

E. Use of Form 990 To Satisfy State supplemented by Standards of Accounting

Tax Form.

Reporting Requirements.—Some states and and Financial Reporting for Voluntary Health

14. Form 4720.—Return of Certain Excise local government units will accept a copy of and Welfare Organizations (New York, N.Y.,

Taxes on Charities and Other Persons Under Form 990 and Schedule A (Form 990) in place National Health Council, Inc. (Washington,

Chapters 41 and 42 of the Internal Revenue of all or part of their own financial report DC), 1988), and by Accounting and Financial

Code. Section 501(c)(3) organizations that file forms. The substitution applies primarily to Reporting—A Guide for United Ways and

Form 990 (or Form 990EZ), as well as the section 501(c)(3) organizations, but some of Not-for-Profit Human Service Organizations

managers of these organizations, use this the other types of section 501(c) (Alexandria, Va., United Way Institute, 1989).

form to report their tax on political organizations are also affected.

expenditures and certain lobbying 5. Donated services and facilities.—

If you intend to use Form 990 to satisfy However, although reporting donated services

expenditures.

state or local filing requirements, such as and facilities as items of revenue and

15. Form 5500, 5500-C/R.—Employers those under state charitable solicitation acts, expense is called for in certain circumstances

who maintain pension, profit-sharing, or other note the following: by the three publications named above, many

funded deferred compensation plans are states and the IRS do not permit the inclusion

1. Determine state filing requirements.—

generally required to file one of the 5500 of those amounts in Parts I and II of Form

You should consult the appropriate officials of

series forms specified below. This 990. The instructions for line 82 discuss the

all states and other jurisdictions in which the

requirement applies whether or not the plan is optional reporting of donated services and

qualified under the Internal Revenue Code organization does business to determine their

specific filing requirements. “Doing business” facilities in Parts III and VI.

and whether or not a deduction is claimed for

the current tax year. in a jurisdiction may include any of the 6. Amended returns.—If the organization

following: (a) soliciting contributions or grants submits supplemental information or files an

The forms required to be filed are: by mail or otherwise from individuals, amended Form 990 with the IRS, it must also

Form 5500.—Annual Return/Report of businesses, or other charitable organizations; furnish a copy of the information or amended

Employee Benefit Plan. Used for each plan (b) conducting programs; (c) having return to any state with which it filed a copy

with 100 or more participants. employees within that jurisdiction; (d) of Form 990 originally to meet that state’s

Form 5500-C/R.—Return/Report of Employee maintaining a checking account; or (e) owning filing requirement.

Benefit Plan. Used for each plan with fewer or renting property there. If a state requires the organization to file an

than 100 participants. 2. Monetary tests may differ.—Some or amended Form 990 to correct conflicts with

16. Form 5768.—Election/Revocation of all of the dollar limitations applicable to Form Form 990 instructions, it must also file an

Election by an Eligible Section 501(c)(3) 990 when filed with the IRS may not apply amended return with the IRS.

Organization To Make Expenditures To when using Form 990 in place of state or 7. Method of accounting.—Most states

Influence Legislation. local report forms. Examples of the IRS dollar require that all amounts be reported based on

limitations that do not meet some state the accrual method of accounting. (See also

17. Form 8282.—Donee Information requirements are the $25,000 gross receipts

Return. Required of the donee of “charitable Specific Instructions, item J.)

minimum that creates an obligation to file

deduction property” who sells, exchanges, or with the IRS (see General Instruction C11) 8. Time for filing may differ.—The time for

otherwise disposes of the property within two and the $30,000 minimum for listing filing Form 990 with the IRS differs from the

years after receiving the property. time for filing reports with some states.

professional fees in Part II of Schedule A

Also, the form is required of any successor (Form 990). 9. Public inspection.—The Form 990

donee who disposes of charitable deduction 3. Additional information may be information made available for public

property within two years after the date that inspection by the IRS may differ from that

required.—State or local filing requirements

the donor gave the property to the original may require you to attach to Form 990 one or made available by the states. See the

donee. It does not matter who gave the cautionary note, Note (2), for line 1d.

more of the following: (a) additional financial

property to the successor donee. It may have statements, such as a complete analysis of 10. State registration number.—Insert the

been the original donee or another successor applicable state or local jurisdiction

functional expenses or a statement of

donee. For successor donees, the form must changes in financial position; (b) notes to registration or identification number in item D

be filed only for any property that was financial statements; (c) additional financial (in the heading on page 1) for each

transferred by the original donee after schedules; (d) a report on the financial jurisdiction in which the organization files

July 5, 1988. statements by an independent accountant; Form 990 in place of the state or local form.

18. Form 8300.—Report of Cash Payments and (e) answers to additional questions and When filing in several jurisdictions, prepare as

Over $10,000 Received in a Trade or other information. Each jurisdiction may many copies as needed with item D blank.

Business. Used to report cash amounts in require the additional material to be Then enter the applicable registration number

excess of $10,000 that were received in a presented on forms they provide. The on the copy to be filed with each jurisdiction.

single transaction (or in two or more related additional information does not have to be

Page 3

F. Other Forms as Partial Substitutes for Use the 1992 Form 990 to report on a amended return available for public inspection

Form 990.—Except as provided below, the calendar-year 1992 accounting period or a for three years from the date of filing or three

Internal Revenue Service will not accept any fiscal year that began in 1992. For a group years from the date the original return was

form as a substitute for one or more parts of return, see General Instruction Q. due, whichever is later.

Form 990. If the organization changes its accounting Use Form 4506-A to obtain a copy of a

1. Labor organizations.—A labor period, it may also use the 1992 form as the previously filed return. You can obtain blank

organization that files Form LM-2, Labor return for a short period (less than 12 months) forms for prior years by calling

Organization Annual Report, or the shorter ending November 30, 1993, or earlier. 1-800-TAX-FORM (1-800-829-3676).

Form LM-3, with the U.S. Department of In general, to change the organization’s If the return is a final return, see the

Labor (DOL) can attach a copy of the accounting period, it must file timely a return instructions for line 79, Part VI, Other

completed DOL form to Form 990 to provide on Form 990 for the short period resulting Information.

some of the information required by Form from the change. At the top of the short

990. This substitution is not permitted if the K. Penalties.—

period return, write Change of Accounting

organization files a DOL report that Period. Against the organization.—Under section

consolidates its financial statements with 6652(c), a penalty of $10 a day, not to

If the organization changed its accounting

those of one or more separate subsidiary exceed the lesser of $5,000 or 5% of the

organizations. period within the ten-calendar-year period

that includes the beginning of the short gross receipts of the organization for the

2. Employee benefit plans.—An employee period, and it had a Form 990 filing year, may be charged when a return is filed

benefit plan may be able to substitute Form requirement at any time during that ten-year late, unless the organization can show that

5500 or Form 5500-C/R for part of Form 990. period, it must also attach a Form 1128 to the late filing was due to reasonable cause.

The substitution can be made if the the short period return. See Rev. Proc. 85-58, The penalty begins on the due date for filing

organization filing Form 990 and the plan 1985-2 C.B. 740. the Form 990. The penalty may also be

filing Form 5500 or 5500-C/R meet all the charged if the organization files an incomplete

following tests: H. When and Where To File.—File Form 990

return or furnishes incorrect information. To

by the 15th day of the 5th month after the

a. The Form 990 filer is organized under avoid having to supply missing information

organization’s accounting period ends.

section 501(c)(9), (17), (18), or (20); later, be sure to complete all applicable line

If the organization is liquidated, dissolved, items; answer “Yes,” “No,” or “N/A” (not

b. The Form 990 filer and Form 5500 filer or terminated, file the return by the 15th day applicable) to each question on the return;

are identical for financial reporting purposes of the 5th month after the change. make an entry (including a “-0-” when

and have identical receipts, disbursements,

If the return is not filed by the due date appropriate) on all total lines; and enter

assets, liabilities, and equity accounts;

(including any extension granted), attach a “None” or “N/A” if an entire part does not

c. The employee benefit plan does not statement giving the reasons for not filing apply.

include more than one section 501(c) timely. Against responsible person(s).—If the

organization, and the section 501(c)

If the principal office Send the return to organization does not file a complete return

organization is not a part of more than one is located in— the Internal Revenue or does not furnish correct information, the

employee benefit plan, and Service IRS will write to give the organization a fixed

d. The organization’s accounting year and Center below—

time to fulfill these requirements. After that

the employee plan year are the same. If they period expires, the person failing to comply

are not, you may want to change the Alabama, Arkansas, Florida, will be charged a penalty of $10 a day, not to

organization’s accounting year, as explained Georgia, Louisiana,

Atlanta, GA 39901 exceed $5,000, unless he or she shows that

in General Instruction G, so it will coincide Mississippi, North Carolina,

South Carolina, or Tennessee not complying was due to reasonable cause.

with the plan year. If more than one person is responsible, they

Allowable substitution areas.—Whether Arizona, Colorado, Kansas, are jointly and individually liable for the

New Mexico, Oklahoma, Austin, TX 73301

an organization files Form 990 for a labor penalty.

Texas, Utah, or Wyoming

organization or for an employee plan, the There are also penalties—fines and

areas of Form 990 for which other forms can Indiana, Kentucky, Michigan, imprisonment—for willfully not filing returns

Cincinnati, OH 45999

be substituted are the same. These areas are: Ohio, or West Virginia

and for filing fraudulent returns and

Part I, lines 13 through 15 (but complete Alaska, California, Hawaii, statements with the IRS (sections 7203, 7206,

lines 16 through 21); Idaho, Nevada, Oregon, or Fresno, CA 93888 and 7207). There are also penalties for failure

Washington

Part II; and to comply with public disclosure requirements

Connecticut, Maine, as discussed in General Instruction L. States

Part IV (but complete lines 59, 66, and 74, Massachusetts, New may impose additional penalties for failure to

Columns (A) and (B)). Holtsville, NY 00501

Hampshire, New York, Rhode meet their separate filing requirements.

If an organization substitutes Form LM-2 or Island, or Vermont

L. Public Inspection of Completed Exempt

LM-3 for any of the Form 990 Parts or line Illinois, Iowa, Minnesota, Organization Returns and Approved

items mentioned above, it must attach a Missouri, Montana, Nebraska,

Kansas City, MO 64999 Exemption Applications.—

reconciliation sheet to show the relationship North Dakota, South Dakota,

between the amounts on the DOL forms and or Wisconsin Through the IRS.—

the amounts on Form 990. This is particularly Delaware, Maryland, New Forms 990, 990EZ, 990-PF, and certain

true of the relationship of disbursements Jersey, Pennsylvania, Virginia,

Philadelphia, PA 19255

other completed exempt organization returns

shown on the DOL forms and the total District of Columbia, any U.S. are available for public inspection and

possession, or foreign country copying upon request. Approved applications

expenses on line 17, Part I, of Form 990. The

organization must make this reconciliation I. Extension of Time To File.—Use Form for exemption from Federal income tax are

because the cash disbursements section of 2758 to request an extension of time to file. also available. The IRS, however, may not

the DOL forms includes nonexpense items. If disclose portions of an application relating to

the organization substitutes Form LM-2, be J. Amended Return/Final Return.—To any trade secrets, etc., nor can the IRS

sure to complete its separate schedule of change the organization’s return for any year, disclose the schedule of contributors required

expenses. file a new return with the correct information by Forms 990 and 990EZ (section 6104).

that is complete in all respects, including

G. Accounting Period Covered.—Base the required attachments. Thus, the amended A request for inspection must be in writing

return on the organization’s annual return must provide all the information called and must include the name and address (city

accounting period (fiscal year) if one is for by the form and instructions, not just the and state) of the organization that filed the

established. If not, base the return on the new or corrected information. Write Amended return or application. A request to inspect a

calendar year. Return at the top of the return. return should indicate the type (number) of

A fiscal year should normally coincide with the return and the year(s) involved. The

The organization may file an amended request should be sent to the District Director

the natural operating cycle of the return at any time to change or add to the

organization. The fiscal year need not end on (Attention: Disclosure Officer) of the district in

information reported on a previously filed which the requester desires to inspect the

December 31 or June 30. return for the same period. It must make the return or application. If inspection at the IRS

Page 4

National Office is desired, the request should its annual returns and exemption application. P. Erroneous Backup Withholding.—

be sent to the Commissioner of Internal The information may be mailed. See the Recipients of dividend or interest payments

Revenue, Attention: Freedom of Information reference to Notice 88-120 in the discussion generally must certify their correct taxpayer

Reading Room, 1111 Constitution Avenue, above for Annual return. The organization identification number to the bank or other

N.W., Washington, DC 20224. need not disclose any portion of an payer on Form W-9, Request for Taxpayer

Form 4506-A can be used to request a application relating to trade secrets, etc., that Identification Number and Certification. If the

copy or to inspect an exempt organization would not also be disclosable by the IRS. payer does not get this information, it must

return through the IRS. There is a fee for The penalties for failure to comply with this withhold part of the payments as “backup

photocopying. provision are the same as those discussed in withholding.” If the organization was subject

Annual return above, except that the $5,000 to erroneous backup withholding because the

Through the organization.— payer did not realize it was an exempt

limitation does not apply.

1. Annual return.—An organization must, organization and not subject to this

during the three-year period beginning with M. Solicitations of Nondeductible withholding, it can claim credit on Form 990-T

the due date (including extensions, if any), of Contributions.—Any fundraising solicitation for the amount withheld. See the Instructions

the Form 990 (or 990EZ), make its return by or on behalf of any section 501(c) for Form 990-T. Claims for refund must be

available for public inspection upon request. organization that is not eligible to receive filed within three years after the date the

All parts of the return and all required contributions deductible as charitable

original return was due; three years after the

schedules and attachments, other than the contributions for Federal income tax purposes date the organization filed it; or two years

schedule of contributors to the organization, must include an express statement that after the date the tax was paid, whichever is

must be made available. Inspection must be contributions or gifts to it are not deductible later.

permitted during regular business hours at as charitable contributions. The statement

must be in a conspicuous and easily Q. Group Return.—A central, parent, or “like”

the organization’s principal office and at each organization can file a group return on Form

of its regional or district offices having three recognizable format whether the solicitation is

made in written or printed form, by television 990 for two or more local organizations that

or more employees.

or radio, or by telephone. However, this are:

This provision applies to any organization provision applies only to those organizations 1. Affiliated with the central organization at

that files Form 990 (or Form 990EZ),

whose annual gross receipts are normally the time its annual accounting period ends,

regardless of the size of the organization and more than $100,000. Religious and apostolic

whether or not it has any paid employees. 2. Subject to the central organization’s

organizations described in section 501(d), as general supervision or control,

If an organization furnishes additional well as political organizations (including PACs)

information to the IRS to be made part of its described in section 527(e), are also required 3. Exempt from tax under a group

return, as a result of an examination or to comply with this provision. exemption letter that is still in effect, and

correspondence from the service center 4. Have the same accounting period as the

Failure to disclose that contributions are

processing the return, it must also make that central organization.

not deductible could result in a penalty of

information part of the return it provides for If the parent organization is required to file

$1,000 for each day on which a failure

public inspection. a return for itself, it must file a separate return

occurs. The maximum penalty for failures by

If the organization does not maintain a any organization, during any calendar year, and may not be included in the group return.

permanent office, it must provide a shall not exceed $10,000. In cases where the See General Instruction C for a list of

reasonable location for a requester to inspect failure to make the disclosure is due to organizations not required to file.

the organization’s annual returns. The intentional disregard of the law, the $10,000 Every year, each local organization must

organization may mail the information to a limitation does not apply and more severe authorize the central organization in writing to

requester. However, the organization can penalties are applicable. No penalty will be include it in the group return and must

charge for copying and postage only if the imposed if the failure is due to reasonable declare, under penalty of perjury, that the

requester gives up the right to a free cause. authorization and the information it submits to

inspection (Notice 88-120, 1988-2 C.B. 454). be included in the group return are true and

N. Disclosures Regarding Certain

Any person who does not comply with the Information and Services Furnished.—A complete.

public inspection requirement shall be section 501(c) organization that offers to sell If the central organization prepares a group

assessed a penalty of $10 for each day that or solicits money for specific information or a return for its affiliated organizations, check

inspection was not permitted, up to a routine service for any individual that could the “Yes” box in item H(a), in the heading of

maximum of $5,000 with respect to any one be obtained by such individual from a Federal Form 990, and indicate the number of

return. No penalty will be imposed if the government agency free or for a nominal organizations for which the group return is

failure is due to reasonable cause. Any charge must disclose that fact conspicuously filed in item H(b). Attach either (1) a schedule

person who willfully fails to comply shall be when making such offer or solicitation. Any showing the name, address, and employer

subject to an additional penalty of $1,000 organization that intentionally disregards this identification number (EIN) of each affiliated

(sections 6652(c) and 6685). requirement will be subject to a penalty for organization included, or (2) a statement

2. Exemption application.—Any section each day on which the offers or solicitations indicating that the group return includes all

501(c) organization that submitted an are made. The penalty imposed for a affiliated organizations covered by the group

application for recognition of exemption to particular day is the greater of $1,000 or 50% ruling. In item I, indicate the group exemption

the Internal Revenue Service after July 15, of the total cost of the offers and solicitations number (GEN). When preparing the return, be

1987, must make available for public made on that day which lacked the required sure not to confuse the four-digit group

inspection a copy of its application (together disclosure. exemption number (GEN) in item I of the

with a copy of any papers submitted in O. Disclosures Regarding Certain heading on page 1, with the nine-digit

support of its application) and any letter or Transactions and Relationships.—In their employer identification number in item C.

other document issued by the Internal annual returns on Schedule A (Form 990), An affiliated organization covered by a

Revenue Service in response to the section 501(c)(3) organizations must disclose group ruling may file a separate return instead

application. An organization that submitted its information regarding their direct or indirect of being included in the group return. In such

exemption application on or before July 15, transfers to, and other direct or indirect case, check the “Yes” box in item H(c), in the

1987, must also comply with this requirement relationships with, other section 501(c) heading of Form 990, and enter the group

if it had a copy of its application on July 15, organizations (except other section 501(c)(3) exemption number in item I.

1987. As in the case of annual returns, the organizations) or section 527 political

copy of the application and related R. Organizations in Foreign Countries and

organizations. This provision helps to prevent U.S. Possessions.—Report amounts in U.S.

documents must be made available for the diversion or expenditure of a section

inspection during regular business hours at dollars and state what conversion rate you

501(c)(3) organization’s funds for purposes use. Combine amounts from within and

the organization’s principal office and at each not intended by section 501(c)(3). All section

of its regional or district offices having at outside the United States and report the total

501(c)(3) organizations must maintain records for each item. All information must be given in

least three employees. regarding all such transfers, transactions, and the English language.

If the organization does not maintain a relationships. See General Instruction K,

permanent office, it must provide a Penalties.

reasonable location for the inspection of both

Page 5

Specific Instructions If the organization prepares Form 990 for

state reporting purposes, it may file an

Completing All Lines.—Unless the

organization is permitted to use certain DOL

Completing the Heading of Form 990.— identical return with the IRS even though the forms or Form 5500 series returns as partial

The instructions that follow are keyed to return does not agree with the books of substitutes for Form 990 (see General

items in the heading for Form 990. account, unless the way one or more items Instruction F), do not leave any applicable

are reported on the state return conflicts with lines blank or attach any other forms or

Item A. Accounting period.—Use the 1992 the instructions for preparing Form 990 for schedules instead of entering the required

Form 990 to report on a calendar year or a filing with the IRS. For example, if the information on the appropriate line on Form

fiscal year accounting period that began in organization maintains its books on the cash 990.

1992. Show the month and day the fiscal receipts and disbursements method of

year began in 1992 and the date the fiscal Assembling Form 990.—Before filing the

accounting but prepares a state return based Form 990, assemble the package of forms

year ended. Refer to General Instruction G. on the accrual method, it could use that and attachments in the following order:

Item B. Name and address.—If we mailed return for reporting to the IRS. As another

the organization a Form 990 Package with a example, if a state reporting requirement ● Form 990

preaddressed mailing label, please attach the requires the organization to report certain ● Schedule A (Form 990). (The requirement to

label in the name and address space on your revenue, expense, or balance sheet items attach Schedule A (Form 990) applies to ALL

return. Using the label helps us avoid errors differently from the way it normally accounts section 501(c)(3) organizations and ALL

in processing the return. If any information on for them on its books, a Form 990 prepared section 4947(a)(1) charitable trusts.)

the label is wrong, draw a line through that for that state is acceptable for the IRS ● Attachments to Form 990

part and correct it. reporting purposes if the state reporting ● Attachments to Schedule A (Form 990)

Include the suite, room, or other unit requirement does not conflict with the Form

990 instructions. An organization should keep Attachments.—Use the schedules on the

number after the street address. If the Post

a reconciliation of any differences between its official form unless you need more space. If

Office does not deliver mail to the street

books of account and the Form 990 that is you use attachments, they must:

address and the organization has a P.O. box,

show the P.O. box number instead of the filed. 1. Show the form number and tax year;

street address. Most states that accept Form 990 in place 2. Show the organization’s name and

Item C. Employer identification of their own forms require that all amounts be employer identification number;

number.—The organization should have only reported based on the accrual method of 3. Clearly identify the Part or line(s) to

one Federal employer identification number. If accounting. See General Instruction E. which the attachments relate;

it has more than one and has not been Item K. Gross receipts of $25,000 or 4. Include the information required by the

advised which to use, notify the service less.—Check this box if the organization’s form and use the same format as the form;

center for the organization’s area (from the gross receipts are normally not more than

list in General Instruction H). State what 5. Follow the same Part and line sequence

$25,000. However, see General Instructions

numbers the organization has, the name and as the form; and

A5 and C11.

address to which each number was assigned, 6. Be on the same size paper as the form.

Public Inspection.—All information the

and the address of its principal office. The organization reports on or with its Form 990, By following the above instructions for

IRS will advise the organization which number including attachments, will be available for completing and assembling any attachments

to use. Section 501(c)(9) organizations must public inspection, except the schedule of to the Form 990 and, where necessary, the

use their own employer identification number contributors required for line 1d, Part I. Schedule A (Form 990), you will lessen the

and not the number of their sponsor. Please make sure the forms and attachments likelihood for correspondence regarding these

Item D. State registration number.— are clear enough to photocopy legibly. attachments.

Refer to General Instruction E. Signature.—To make the return complete, an Part I—Statement of Revenue,

Item E. Change of address.—If the officer authorized to sign it must sign in the

organization changed its address since it filed space provided. For a corporation, this officer Expenses, and Changes in Net

its previous return, check this box. may be the president, vice president, Assets or Fund Balances.—

Item F. Type of organization.—If the treasurer, assistant treasurer, chief All organizations filing Form 990 with the IRS

organization is exempt under section 501(c), accounting officer, or other corporate officer, or any state must complete Part I. Some

check the applicable box and insert, within such as a tax officer. A receiver, trustee, or states that accept Form 990 in place of their

the parentheses, the number that identifies assignee must sign any return he or she files own forms require additional information.

the type of section 501(c) organization the for a corporation. For a trust, the authorized

trustee(s) must sign. Line 1—Contributions, gifts, grants, and

filer is. Refer to the chart in General

similar amounts received.—On lines 1a

Instruction B. If the organization is a section Generally, anyone who is paid to prepare through 1c, report amounts received as

4947(a)(1) charitable trust, check the the return must sign it in the Paid Preparer’s voluntary contributions; that is, payments, or

applicable box, complete question 92 of Form Use Only area. the part of any payment, for which the payer

990 and see General Instructions D1 and D7. The paid preparer must complete the (donor) does not receive full retail value (fair

Item G. Application pending.—If the required preparer information and: market value) from the recipient (donee)

organization’s application for exemption is ● Sign the return, by hand, in the space organization. (For grants, see Grants that are

pending, check this box and complete the provided for the preparer’s signature equivalent to contributions, below.) Report

return. (signature stamps and labels are not all expenses of raising contributions in

Item H. Group return, etc.—Refer to acceptable). column (D), Part II, and on line 15 of Part I.

General Instruction Q. ● Give a copy of the return to the a. Contributions can arise from special

Item I. Group exemption number.—Enter organization. fundraising events when an excess

the four-digit group exemption number (GEN) If you checked the box for question 92 of payment is received for items offered.—

if you checked a “Yes” box in item H. the form (section 4947(a)(1) charitable trust Special fundraising activities such as dinners,

Contact the central/parent organization if you filing Form 990 instead of Form 1041), you door-to-door sales of merchandise, carnivals,

are unsure of the GEN assigned. must also enter the paid preparer’s social and bingo games can produce both

Item J. Accounting method.—Indicate the security number or employer identification contributions and revenue. If a buyer, at such

method of accounting used in preparing this number in the margin next to the paid an event, pays more for goods or services

return. Unless instructed otherwise, the preparer’s space. Leave the paid preparer’s than their retail value, report as a contribution

organization should generally use the same space blank if the return was prepared by a both on line 1a and on line 9a (within

accounting method on the return to figure regular employee of the filing organization. parentheses) any amount paid in excess of

revenue and expenses that it regularly uses the retail value. This usually occurs when

Rounding Off to Whole Dollars.—You may organizations seek public support through

to keep its books and records. To be show money items as whole-dollar amounts.

acceptable for Form 990 reporting purposes, solicitation programs that are both special

Drop any amount less than 50 cents and fundraising events or activities and

however, the method of accounting used increase any amount from 50 through 99

must clearly reflect income. solicitations for contributions.

cents to the next higher dollar.



Page 6

For example, an organization announces material changes in the organization’s registered and listed on a recognized

that anyone who contributes at least $40 to sources of support in that year. securities exchange, measure market value

the organization can choose to receive a d. Section 501(c)(9), (17), (18), and (20) by the average of the highest and lowest

book worth $16 retail value. A person who organizations.—These organizations provide quoted selling prices (or the average between

gives $40, and who chooses the book, is life, sick, accident, welfare, unemployment, the bona fide bid and asked prices) on the

really purchasing the book for $16 and also pension, group legal services, or similar contribution date. See section 20.2031-1 of

making a contribution of $24. The benefits or a combination of these benefits to the Estate Tax Regulations for rules to

contribution of $24, which is the difference participants. When such an organization determine the value of contributed stocks and

between the buyer’s payment and the $16 receives payments from participants or their bonds. When market value cannot be readily

retail value of the book, would be reported on employers to provide these benefits, report determined, use an appraised or estimated

line 1a and again on the description line of 9a the payments on line 2 as program service value.

(within parentheses). The revenue received revenue, rather than on line 1 as To determine the amount of any noncash

($16 retail value of the book) would be contributions. contribution that is subject to an outstanding

reported in the amount column on line 9a. debt, subtract the debt from the property’s

e. Donations of services are not

If a contributor gives more than $40, that contributions.—In Part I, do not include the fair market value. Record the asset at its full

person would be making a larger contribution, value of services donated to the organization, value and record the debt as a liability in the

the difference between the book’s retail value or items such as the free use of materials, books of account. See also Note (1) in the

of $16 and the amount actually given. Rev. equipment, or facilities as contributions on instructions for line 1d.

Rul. 67-246, 1967-2 C.B. 104, explains this line 1. See the instructions for Part III and for Line 1a—Direct public support.—

principle in detail. See also the line 9 Part VI, line 82, for the optional reporting of

instructions and Publication 1391. a. Contributions, gifts, grants, and

such amounts in Parts III and VI. similar amounts received.—Enter the gross

The expenses relating directly to the sale of f. Grants that are equivalent to amounts of contributions, gifts, grants, and

the book would be reported on line 9b. contributions.—Grants that encourage an bequests that the organization received

However, all other expenses of raising organization receiving the grant to carry on directly from the public. Include amounts

contributions would be reported in column programs or activities that further its exempt received from individuals, trusts, corporations,

(D), Part II (fundraising expense) and on line purposes are grants that are equivalent to estates, and foundations. Also include

15 of Part I. contributions. Report them on line 1. The contributions and grants from public charities

At the time of any solicitation or payment, grantor may require that the programs of the and other exempt organizations that are

organizations that are eligible to receive grant recipient (grantee) conform to the neither fundraising organizations nor affiliates

tax-deductible contributions should advise grantor’s own policies and may specify the of the filing organization. See the instructions

patrons of the amount deductible for Federal use of the grant, such as use for the for line 1b.

tax purposes. restoration of a historic building or a voter b. Membership dues.—Report on line 1a

b. Contributions can arise from special registration drive. membership dues and assessments that

fundraising events when items of only A grant is still equivalent to a contribution if represent contributions from the public rather

nominal value are offered.—If an the grant recipient provides a service or than payments for benefits received or

organization offers goods or services of only makes a product that benefits the grantor payments from affiliated organizations. See

nominal value through a special fundraising incidentally. (See examples in line 1c the instructions for line 3.

event, report the entire amount received for instructions.) However, a grant is a payment c. Government grants.—Report

such benefits as a contribution on line 1a for services, and not a contribution, if the government grants on line 1c if they represent

(direct public support). Report all related grant requires the grant recipient to provide contributions, or on line 2 (and on line 93(g)

expenses in column (D), Part II. Benefits have that grantor with a specific service, facility, or of Part VII) if they represent fees for services.

a nominal value when: product rather than to give a direct benefit See line 1 and 1c instructions.

1. The benefit’s fair market value is not primarily to the general public or to that part

d. Commercial co-venture.—Report

more than 2% of the payment, or $50, of the public served by the organization. In

amounts contributed by a commercial

whichever is less; or general, do not report as contributions any

co-venture on line 1a as a contribution

payments for a service, facility, or product

2. The payment is $30.09 or more; the only received directly from the public. These are

that primarily give some economic or physical

benefits received are token items bearing the amounts received by an organization (donee)

benefit to the payer (grantor).

organization’s name or symbol; and the for allowing an outside organization to use

organization’s cost (as opposed to fair market For example, a public interest organization the donee’s name in a sales promotion

value) is $6.01 or less for all benefits received described in section 501(c)(4) makes a grant campaign. In such a campaign, the donor

by a donor during the calendar year. These to another organization to conduct a advertises that it will contribute a certain

two amounts are adjusted annually for nationwide survey to determine voter dollar amount to the donee organization for

inflation. See Rev. Proc. 92-58, 1992-29 attitudes on issues of interest to the grantor. each unit of a particular product or service

I.R.B. 10. The grantor plans to use the results of the sold or for each occurrence of a specific

survey to plan its own program for the next type.

c. Section 501(c)(3) organizations.— three years. Under these circumstances,

Correctly dividing gross receipts from special e. Contributions received through special

since the survey serves the grantor’s direct

fundraising events into revenue and needs and benefits the grantor more than fundraising events.—Report contributions

contributions is especially important for a received through special fundraising events

incidentally, the grant to the organization

section 501(c)(3) organization that claims making the survey is not a contribution. The on line 1a. See line 1 instructions above and

public support as described in section grant recipient should not report the grant as the instructions for line 9.

170(b)(1)(A)(vi) or 509(a)(2). In the public a contribution but should report it on line 2 as Line 1b—Indirect public support.—Enter the

support computations of these Code program service revenue. total contributions received indirectly from the

sections, the revenue portion of gross public through solicitation campaigns

receipts may be: (a) excluded entirely, (b) Treat research to develop products for the

conducted by federated fundraising agencies

treated as public support, or (c) if the revenue payer’s use or benefit as directly serving the

payer. However, generally, basic research or and similar fundraising organizations (such as

represents unrelated trade or business a United Way organization and certain

income, treated as nonpublic support. studies in the physical or social sciences

should not be treated as serving the payer’s sectarian federations). These organizations

Section 501(c)(3) organizations must divide normally conduct fundraising campaigns

needs.

gross receipts from special fundraising events within a single metropolitan area or some part

into revenue and contributions according to See Regulations section 1.509(a)–3(g) to of a particular state and allocate part of the

the above instructions when preparing the determine if a grant is a contribution net proceeds to each participating

Support Schedule in Part IV of Schedule A reportable on line 1 or a revenue item organization on the basis of the donor’s

(Form 990). reportable elsewhere on Form 990. individual designations and other factors.

The Support Schedule generally includes g. Noncash contributions.—To report Include on line 1b amounts contributed by

only the four preceding years but also contributions received in a form other than other organizations closely associated with

includes the current year if there have been cash, use the market value as of the date of the reporting organization. This includes

the contribution. For marketable securities contributions received from a parent

Page 7

organization, subordinate, or another support test of the Regulations under section as author of an educational publication

organization having the same parent. National 170(b)(1)(A)(vi) (whether or not the distributed by a commercial publisher;

organizations that share in fundraising organization is otherwise described in section interest income on loans a credit union

campaigns conducted by their local affiliates 170(b)(1)(A)). makes to its members; payments received by

should report the amount they receive on line The schedule should give the above a section 501(c)(9) organization from

1b. information only for contributors whose gifts participants, or employers of participants, for

Line 1c—Government grants.—The of $5,000 or over are more than 2% of the health and welfare benefits coverage;

preceding line 1 instructions, under the total gifts (reported on line 1d) that the insurance premiums received by a fraternal

heading, Grants that are equivalent to organization received during the year. beneficiary society; and registration fees

contributions, apply to this item in particular. received in connection with a meeting or

Exception 2: Organization described in convention.

A grant or other payment from a section 501(c)(7), (8), or (10) that received

governmental unit represents a contribution if contributions or bequests for use only as b. Program-related investments.—

its primary purpose is to enable the donee to described in section 170(c)(4), 2055(a)(3), or Program service revenue also includes

provide a service to, or maintain a facility for, 2522(a)(3). income from program-related investments.

the direct benefit of the public rather than to These investments are made primarily to

serve the direct and immediate needs of the The schedule should list each person

accomplish an exempt purpose of the

grantor even if the public pays part of the whose gifts total more than $1,000 during the investing organization rather than to produce

expense of providing the service or facility. year. Give the donor’s name, the amount

income. Examples are scholarship loans and

given, the gift’s specific purpose, and the low interest loans to charitable organizations,

The following are examples of specific use to which it was put. If an amount

governmental grants and other payments that indigents, or victims of a disaster. Rental

is set aside for a purpose described in income from an exempt function is another

represent contributions: section 170(c)(4), 2055(a)(3), or 2522(a)(3),

example. See line 6 instructions.

1. Payments by a governmental unit for the explain how the amount is held; e.g., whether

construction or maintenance of library or it is mingled with amounts held for other c. Unrelated trade or business

hospital facilities open to the public, purposes. If the organization transferred the activities.—Unrelated trade or business

gift to another organization, name and activities (not including any special

2. Payments under government programs

describe the recipient and explain the fundraising events or activities) that generate

to nursing homes or homes for the aged in

relationship between the two organizations. fees for services may also be program service

order to provide health care or other services

Also show the total gifts that were $1,000 or activities. A social club, for example, should

to their residents,

less and were for a purpose described in report as program service revenue the fees it

3. Payments to child placement or child charges both members and nonmembers for

section 170(c)(4), 2055(a)(3), or 2522(a)(3).

guidance organizations under government the use of its tennis courts and golf course.

programs serving children in the community. Note (1): If the organization qualifies to

receive tax-deductible charitable contributions d. Sales of inventory items by hospitals,

The general public gets the primary and

and it receives contributions of property (other colleges, and universities.—Books and

direct benefit from these payments and any

than publicly traded securities) whose fair records maintained in accordance with

benefit to the governmental unit itself would

market value is more than $5,000, the generally accepted accounting principles for

be indirect and insubstantial as compared to

organization should usually receive a partially hospitals, colleges, and universities are more

the public benefit.

completed Form 8283, Noncash Charitable specialized than books and records

Line 1d—Total contributions, etc.—Enter maintained according to those accounting

Contributions, from the contributor. Complete

the total of amounts reported on lines 1a principles for other types of organizations that

the appropriate information on Form 8283,

through 1c. file Form 990. Accordingly, hospitals,

sign it, and return it to the donor. Retain a

Attached schedule.—Schedule of copy for the organization’s records. See also colleges, and universities may report, as

contributors (not open to public inspection) General Instruction D17. program service revenue on line 2, sales of

Caution: See Note (2) below. inventory items otherwise reportable on line

Note (2): Caution: If the organization files a 10a. In that event, show the applicable cost

Attach a schedule listing contributors who copy of Form 990 and attachments with any

gave the organization, directly or indirectly, of goods sold as program service expense on

state, do not include, in the attachments for line 13 of Part I and in column (B) of Part II.

money, securities, or other property worth the state, the schedule of contributors

$5,000 or more during the year. If no one All other organizations, however, should not

discussed above, unless the schedule is

contributed the reportable minimum, the report sales of inventory items on line 2.

specifically required by the state with which

organization does not need to attach a the organization is filing the return. States that Line 3—Membership dues and

schedule. Show each contributor’s name and do not require the information might assessments.—Enter members’ and

address, the total amount received, and the nevertheless make it available for public affiliates’ dues and assessments that are not

date received. Contributors include inspection along with the rest of the return. contributions.

individuals, fiduciaries, partnerships, a. Dues and assessments received that

Lines 2 through 11.—Note: Do not enter any

corporations, associations, trusts, or exempt compare reasonably with available

contributions on lines 2 through 11. Enter all

organizations. benefits.—When dues and assessments are

contributions on line 1. If you enter

If an employer withholds contributions from contributions on lines 2 through 11, you will received that compare reasonably with

employees’ pay and periodically gives them be unable to complete Part VII correctly. membership benefits, report such dues and

to the organization, report only the employer’s assessments on line 3.

Line 2—Program service revenue.—Enter

name and address and the total amount b. Organizations that usually match dues

the total of program service revenue (exempt

given unless you know that a particular and benefits.—Organizations, other than

function income) as reported in Part VII, lines

employee gave enough to be listed those described in section 501(c)(3), generally

93(a) through (g), columns (b), (d), and (e).

separately. provide benefits that have a reasonable

Program services are primarily those that

In determining whether a contributor gave form the basis of an organization’s exemption relationship to dues. This occurs usually in

$5,000 or more, total that person’s gifts of from tax. For further definition, see the organizations described in section 501(c)(5),

$1,000 or more. Do not include smaller gifts. instructions for Part II, column (B). (6), or (7), although benefits to members may

If the contribution consists of property whose be indirect. Report such dues and

a. Examples.—A hospital would report on assessments on line 3.

fair market value can be determined readily

this line all of its charges for medical services

(such as market quotations for securities), c. Dues or assessments received that

(whether to be paid directly by the patients or

describe the property and list its fair market exceed the value of available membership

through Medicare, Medicaid, or other

value. Otherwise, estimate the property’s benefits.—Whether or not membership

third-party reimbursement), hospital parking

value. See Note (1) below. benefits are used, dues received by an

lot fees, room charges, laboratory fees for

If an organization meets the terms of either hospital patients, and related charges for organization, to the extent they are more than

of the following exceptions, some information services. the monetary value of the membership

in its schedule will vary from that described benefits available to the dues payer, are a

Other examples of program service revenue

above. contribution includable on line 1a. See Rev.

are tuition received by a school; revenue from Rul. 54-565, 1954-2 C.B. 95 and Rev. Rul.

Exception 1: Organization described in admissions to a concert or other performing

section 501(c)(3) that meets the 331⁄3% 68-432, 1968-2 C.B. 104.

arts event or to a museum; royalties received

Page 8

d. Dues received primarily for the in an attachment. The income should be the preferred stocks, bonds (including

organization’s support.—If a member pays gross amount derived from investments governmental obligations), and mutual fund

dues primarily to support the organization’s reportable on line 56. Include, for example, shares that are listed and regularly traded in

activities, and not to obtain benefits of more royalty income from mineral interests owned an over-the-counter market or on an

than nominal monetary value, those dues are by the organization. However, do not include established exchange and for which market

a contribution to the organization includable income from program-related investments. quotations are published or otherwise readily

on line 1a. See the instructions for line 2. Also exclude available.

e. Examples of membership benefits.— unrealized gains and losses on investments Lines 9a through 9c—Special fundraising

Examples of such benefits include carried at market value. See the instructions events and activities.—On the appropriate

subscriptions to publications, newsletters for line 20. line, enter the gross revenue, expenses, and

(other than one about the organization’s Lines 8a through 8d—Gains from sale of net income from all special fundraising events

activities only), free or reduced-rate assets.—Report, on lines 8a through 8c, all and activities, such as dinners, dances,

admissions to events the organization sales of securities in column (A). Use column carnivals, raffles, bingo games, other

sponsors, the use of its facilities, and (B) to report sales of all other types of gambling activities, and door-to-door sales of

discounts on articles or services that both investments (such as real estate, royalty merchandise. In themselves, these activities

members and nonmembers can buy. In interests, or partnership interests) and all only incidentally accomplish an exempt

figuring the value of membership benefits, other noninventory assets (such as purpose. Their sole or primary purpose is to

disregard other intangible benefits, such as program-related investments and fixed assets raise funds (other than contributions) to

the right to attend meetings, vote or hold used by the organization in its related and finance the organization’s exempt activities.

office in the organization, and the distinction unrelated activities). This is done by offering goods or services

of being a member of the organization. On line 8a, for each column, enter the total that have more than a nominal value

Line 4—Interest on savings and temporary gross sales price of all such assets. Total the (compared to the price charged) for a

cash investments.—Enter the amount of cost or other basis (less depreciation), and payment that is more than the direct cost of

interest income from savings and temporary selling expenses and enter the result on line those goods or services.

cash investments reportable on line 46. 8b. On line 8c, enter the net gain or loss. Characterizing any required payment as a

So-called dividends or earnings received from On lines 8a and 8c, also report capital “donation” or “contribution” on tickets or on

mutual savings banks, etc., are actually gains dividends, the organization’s share of advertising or solicitation materials does not

interest and should be entered on line 4. capital gains and losses from a partnership, affect how such payments should be reported

Line 5—Dividends and interest from and capital gains distributions from trusts. on Form 990. As discussed in the instructions

securities.—Enter the amount of dividend Indicate the source on the schedule for line 1, the amount of the contribution is

and interest income from debt and equity described below. the excess of the amount paid over the retail

securities (stocks and bonds) of the type value of the goods or services received by

Combine the gain and/or loss figures

reportable on line 54. Include amounts the payer. See also Publication 1391.

reported on line 8c, columns (A) and (B) and

received from payments on securities loans, report that total on line 8d. Do not include a. Special fundraising events may

as defined in section 512(a)(5). Do not include any unrealized gains or losses on securities generate both revenue and

any capital gains dividends that are carried at market value in the books of contributions.—Special fundraising events

reportable on line 8. See the instructions for account. See the instructions for line 20. sometimes generate both contributions and

line 2 for reporting income from revenue. When a buyer pays more than the

For reporting sales of securities on Form

program-related investments. retail value of the goods or services

990, you may use the more convenient

Line 6a—Gross rents.—Enter the gross furnished, enter—

average cost basis method to figure the

rental income for the year from investment organization’s gain or loss. When a security is 1. As gross revenue, on line 9a (in the

property reportable on line 55. Do not include sold, compare its sales price with the average amount column) the retail value of the goods

rental income from an exempt function cost basis of the particular security to or services,

(program service). For example, an determine gain or loss. However, generally, 2. As a contribution, on both line 1a and

organization whose exempt purpose is to for reporting sales of securities on Form line 9a (within parentheses) the amount

provide low-rental housing to persons with 990-T, do not use the average cost basis to received that exceeds the retail value of the

low income receives exempt function income determine gain or loss. goods or services given.

from such rentals. Report such income on

Attached schedule.— Report on line 9b only the expenses

line 2 and report the related expenses in

column (B) of Part II. Rental income, however, a. Assets other than publicly traded directly attributable to the goods or services

is not exempt function income when an securities and inventory.—Attach a the buyer receives from a special fundraising

organization rents office space, or other schedule showing the sale or exchange of event. If you include an expense on line 9b,

facilities or equipment, to unaffiliated exempt nonpublicly traded securities and the sale or do not report it again on line 10b or in Part II.

organizations. Report such rental income on exchange of other assets that are not For example, at a special fundraising event,

line 6a, unless the rent charged is well below inventory items. The schedule should show an organization received $100 in gross

the fair rental value of the property and the security transactions separately from the sale receipts for goods valued at $40. The

purpose for charging rent at less than fair of other assets. Show for each of these organization entered gross revenue of $40 on

rental value was to help the organization that assets: line 9a (in the amount column) and entered a

rented the property to carry out its own 1. Date acquired and how acquired, contribution of $60 on both line 1a and line

exempt purpose. 9a (within parentheses). The contribution of

2. Date sold and to whom sold,

Only for purposes of completing this return, $60 was the difference between the gross

3. Gross sales price, revenue of $40 and the gross receipts of

treat income from renting property to affiliated

exempt organizations as exempt function 4. Cost, other basis, or if donated, value at $100.

income (program service revenue) and report time acquired (state which), For further guidance regarding contributions

it on line 2. 5. Expense of sale and cost of and revenue, see line 1 and 1a instructions.

Line 6b—Rental expenses.—Enter the improvements made after acquisition, and b. Sales of goods or services of only

expenses paid or incurred for the income 6. If depreciable property, depreciation nominal value.—If the goods or services

reported on line 6a. Include depreciation if it since acquisition. offered at special fundraising events have

is recorded in the organization’s books and b. Publicly traded securities.—In the only nominal value, include all of the receipts

records. attached schedule, for sales of publicly as contributions on line 1a and all of the

Line 6c—Net rental income or (loss).— traded securities through a broker, total the related expenses as fundraising expenses on

Subtract line 6b from line 6a. Show any loss gross sales price, the cost or other basis, and line 15 and in column (D) of Part II. See line 1

in parentheses. the expenses of sale on all such securities instructions for a description of benefits of

sold, and report lump-sum figures in place of nominal value. These are adjusted annually

Line 7—Other investment income.— Enter for inflation.

the amount of investment income not the detailed reporting required by the above

reportable on lines 4 through 6 and describe paragraph. For preparing Form 990, publicly c. An activity may generate only

the type of income in the space provided or traded securities include common and contributions.—An activity that generates



Page 9

only contributions, such as a solicitation those sold in special fundraising events and the organization furnishing them (for example,

campaign by mail, is not a special fundraising activities reported on line 9. Sales of when a local organization incurs expenses in

event and should not be reported on line 9. inventory items reportable on line 10 are sales the production of a solicitation film for the

d. Sweepstakes, raffles, and lotteries of those items the organization either makes state or national organization); and

may produce revenue or contributions.— to sell to others or buys for resale. Sales of 2. The costs involved are not connected

The proceeds of solicitation campaigns in investments on which the organization with the management and general or

which the names of contributors and other expected to profit by appreciation and sale fundraising functions of the reporting

respondents are entered in a drawing for the are not reported here. Report sales of organization. For example, when a local

awarding of prizes (so-called “sweepstakes” investments on line 8. organization furnishes a copy of its mailing

or “lotteries”) are contributions and the Report sales revenue and the related cost list to the state or national organization, the

related expenses are fundraising expenses of goods sold on line 10 whether the sale of expense of preparing the copy provided may

reportable in column (D) of Part II. However, the merchandise involved is an exempt be reported on line 16, but not expenses of

raffles and lotteries in which a payment of at function or an unrelated trade or business. preparing and maintaining the local

least a specified minimum amount is required Hospitals, colleges, and universities can, organization’s master list.

for each entry are special fundraising events however, use an optional method of reporting d. Federated fundraising agencies.—

unless the prizes awarded have only nominal sales of inventory items. See line 2 These agencies (see the instructions for line

value. instructions. 1b) should include in their own support the

e. Attached schedule.—Attach a schedule Attached schedule.—In an attached full amount of contributions received in

listing the three largest special events schedule, give a breakdown of items sold; connection with a solicitation campaign they

conducted, as measured by gross receipts. e.g., sales of food, cars, educational or conduct, even though donors designate

Describe each of these events and indicate religious materials. specific agencies to receive part or all of their

for each event the gross receipts; the amount individual contributions. These fundraising

of contributions included in gross receipts Line 11—Other revenue.—Enter the total organizations should report the allocations to

(see the instructions above); the gross amount from Part VII, lines 103(a) through (e), participating agencies as grants and

revenue (gross receipts less contributions); columns (b), (d), and (e). This figure allocations (line 22) and quota support

the direct expenses; and the net income represents the total income from all sources payments to their state or national

(gross revenue less direct expenses). not covered by lines 1 through 10. Examples organization as payments to affiliates (line

of income includable on line 11 are interest 16).

Furnish the same information, in total on notes receivable not held as investments;

figures, for all other special events held that interest on loans to officers, directors, e. Voluntary awards or grants to

are not among the three largest. Indicate the trustees, key employees and other affiliates.—Do not report on line 16 voluntary

type and number of the events not listed employees; and royalties that are not awards or grants made by the reporting

individually (for example, three dances and investment income or program service agency to its state or national organization for

two raffles). revenue. specified purposes. Report such awards or

An example of this schedule might appear grants on line 22, Grants and allocations.

Line 12—Total revenue.—Enter the total of

in columnar form as follows: lines 1d through 11. f. Membership dues paid to other

Special Events: (A) (B) (C) Total organizations.—Report membership dues

Lines 13 through 15—Program services, that are paid to obtain general membership

management and general, and fundraising benefits, such as regular services,

Gross Receipts $XXX $XXX $XXX $XXX expenses.—

Less: Contributions XXX XXX XXX XXX publications, and materials, from other

a. Section 4947(a)(1) charitable trusts organizations as “Other expenses” on line 43.

Gross Revenue XXX XXX XXX XXX

and section 501(c)(3) and (c)(4) This is the case, for example, if a charitable

Less: Direct Expenses XXX XXX XXX XXX

organizations.—Complete Part II and then organization pays dues to a trade association

Net Income or (loss) $XXX $XXX $XXX $XXX

enter on lines 13 through 15 the appropriate comprised of otherwise unrelated members.

If you use the above schedule, report the amounts from the totals for columns (B), (C), g. Attached schedule.—Attach a schedule

total for contributions on line 1a of Form 990 and (D) reported on line 44, Part II. listing the name and address of each affiliate

and on line 9a (within parentheses of the b. All other organizations.—All other that received payments reported on line 16.

description line). Report the totals for gross organizations are not required to complete Specify the amount and purpose of the

revenue, in the amount column, on line 9a; lines 13 through 15. payments to each affiliate.

direct expenses on line 9b; and net income or

(loss) on line 9c. Line 16—Payments to affiliates.—This Note: Properly distinguishing between

expense classification is used to report payments to affiliates and grants and

f. Fundraising record retention.—Section certain types of payments to organizations allocations is especially important if you use

501(c) organizations that are eligible to “affiliated with” (closely related to) a reporting Form 990 for state reporting purposes. See

receive tax-deductible contributions under agency. General Instruction E. If you use Form 990

section 170(c) of the Code must keep sample only for reporting to the IRS, payments to

copies of their fundraising materials, such as a. Payments to affiliated state or national

organizations.—Dues payments by the local affiliated state or national organizations that

dues statements or other fundraising do not represent membership dues reportable

charity to its affiliated state or national

solicitations, tickets, receipts, or other as “Other expenses” on line 43 (see

evidence of payments received in connection (parent) organization are usually reported on

line 16. Report on this line predetermined instructions above) may be reported either on

with fundraising activities. If organizations line 16 or line 22 and explained in the

quota support and dues payments (excluding

advertise their fundraising events, they must required attachment.

keep samples of the advertising copy. If they membership dues of the type described

below) by local agencies to their state or Line 17—Total expenses.—Organizations

use radio or television to make their

solicitations, they must keep samples of national organizations for unspecified using only column (A) of Part II should enter

purposes; i.e., general use of funds for the the total of line 16 and line 44 of column (A),

scripts, transcripts, or other evidence of

on-air solicitations. If organizations retain national organization’s own program and Part II on line 17. Other organizations should

outside fundraisers, they must keep samples support services. enter the total of lines 13 through 16.

of the fundraising materials used by the b. Purchases from affiliates.—Purchases Organizations using Form 5500, 5500-C/R, or

outside fundraisers. For each fundraising of goods or services from affiliates are not an approved DOL form as a partial substitute

event, organizations must keep records to reported on line 16 but are reported as for Form 990 should enter the total expense

show that portion of any payment received expenses in the usual manner. figure from Form 5500 or 5500-C/R, or from

from patrons that is not deductible; that is, c. Expenses for providing goods or the required reconciliation schedule if Form

the retail value of the goods or services services to affiliates.—In addition to LM-2 or LM-3 is used. See General

received by the patrons. payments made directly to affiliated Instruction F.

Lines 10a through 10c—Gross profit or organizations, expenses incurred in providing Line 18—Excess or (deficit) for the year.—

(loss) on sales of inventory.—Enter the goods or services to affiliates may be Enter the difference between lines 12 and 17.

gross sales (less returns and allowances), reported on line 16 if: If line 17 is more than line 12, enter the

cost of goods sold, and gross profit or (loss) 1. The goods or services provided are not difference in parentheses.

from the sale of all inventory items, other than related to the program services conducted by

Page 10

Line 19—Net assets or fund balances, Part II. Except for expenses you report on reportable on line 9a. However, report any

beginning of year.—Enter the amount from lines 6b, 8b, 9b, 10b, or 16 of Part I, you expenses attributable to revenue on line 9a

column (A) of line 74 (or from Form 5500, should use column (A) to report all expenses (that is, the direct expenses incurred in

5500-C/R, or an approved DOL form if the organization paid or incurred. furnishing the goods or services sold) on line

General Instruction F applies). Column (B)—Program services.—Program 9b.

Line 20—Other changes in net assets or services are mainly those activities that the Allocating indirect expenses.—Colleges,

fund balances.—Attach a schedule reporting organization was created to conduct universities, hospitals, and other organizations

explaining any changes in net assets or fund and which, along with any activities that accumulate indirect expenses in various

balances between the beginning and end of commenced subsequently, form the basis of cost centers (such as the expenses of

the year that are not accounted for by the the organization’s current exemption from tax. operating and maintaining the physical plant)

amount on line 18. Amounts to report here They may be self-funded or funded out of that are reallocated to the program services

include adjustments of earlier years’ activity; contributions, accumulated income, and other functional areas of the organization

unrealized gains and losses on investments investment income, or any other source. in a single step or in multiple steps may find

carried at market value; and any difference Program services can also include the it easier to report these expenses in the

between fair market value and book value of organization’s unrelated trade or business following optional manner:

property given as an award or grant. activities. For example, publishing a magazine First, report the expenses of these indirect

Line 21—Net assets or fund balances, end is a program service even though it contains cost centers on lines 25 through 43 of the

of year.—Enter the total of lines 18, 19, and both editorials and articles that further the Management and general expense column in

20. This total figure must equal the amount organization’s exempt purpose and Part II, along with the expenses properly

reported in column (B) of line 74. advertising, the income from which is taxable reportable in that column.

as unrelated business income. Second, allocate the total expenses for

Part II—Statement of If an organization receives a grant to do each cost center to Program services,

Functional Expenses.— research, produce an item, or perform a Management and general, and Fundraising as

In General.— service, either to meet the grantor’s specific a separate item entry on line 43, Other

needs or to benefit the public directly, the expenses. Enter the name of the cost center

Column (A).—All organizations must costs incurred represent program service on line 43. If any of the cost center’s

complete column (A) unless they are using an expenses. Do not treat these costs as expenses are to be allocated to the expenses

approved DOL form or Form 5500 or

fundraising expenses, even if you report the listed in Part I (such as the expenses

5500-C/R as a partial substitute for Form 990 grant on line 1 as a contribution. attributable to special fundraising events and

in accordance with General Instruction F.

Column (C)—Management and general.— activities), enter these expenses as a negative

Columns (B), (C), and (D).—These columns figure in columns (A) and (C). This prevents

Use column (C) to report the organization’s

are optional for all organizations other than expenses for overall function and reporting the same expense in both Parts I

section 4947(a)(1) charitable trusts and and II. If part of the total cost center

management, rather than for its direct

section 501(c)(3) and (4) organizations. expenses are to be allocated to columns (B),

conduct of fundraising activities or program

Section 4947(a)(1) charitable trusts and Program services, and (D), Fundraising, enter

services. Overall management usually

section 501(c)(3) and (4) organizations must these expenses as positive amounts in these

includes the salaries and expenses of the

complete columns (B), (C), and (D). columns and as single negative amounts in

chief officer of the organization and that

In Part II the organization’s expenses are officer’s staff. If part of their time is spent column (C). Do not make any entries in

designated by object classification (e.g., directly supervising program services and column (A), Total, for these offsetting entries.

salaries, legal fees, supplies, etc.) and fundraising activities, their salaries and Example.—The following example

allocated into three functions: program expenses should be allocated among those illustrates the above instructions. An

services (column (B)); management and functions. organization reports $50,000 of actual

general (column (C)); and fundraising (column management and general expenses and

Other expenses to report in column (C)

(D)). These functions are explained below in include those for meetings of the board of $100,000 of expenses of an indirect cost

the instructions for the columns. Do not center that are allocable in part to other

directors or similar group; committee and

include in Part II any expense items you must staff meetings (unless held in connection with functions. The total of lines 25 through 43 of

report on lines 6b, 8b, 9b, 10b, or 16 in column (C) would be $150,000 before the

specific program services or fundraising

Part I. activities); general legal services; accounting, allocations were made. Assume that $10,000

For reporting to the IRS only, use the auditing, personnel, and other centralized (of the $100,000 total expenses of the cost

organization’s normal accounting method to services; investment expenses (except those center) was allocable to fundraising; $70,000

report total expenses in column (A) and to relating to rental income and program-related to various program services; $15,000 to

segregate them into functions under columns income—report rental expenses on line 6b management and general functions; and

(B), (C), and (D). However, for state reporting and program-related expenses in column (B)); $5,000 to special fundraising events and

requirements, see General Instruction E and general liability insurance; preparation, activities. To report this in Part II under this

the Specific Instructions, item J. If the publication, and distribution of an annual alternate method:

accounting system does not provide for this report; and office management. 1. Indicate the cost center, the expenses of

type of segregation, a reasonable method of which are being allocated, on line 43, as

However, you should report only general

allocation may be used. The amounts expenses in column (C). Do not use this “Allocation of (specify) expenses”;

reported should be accurate and the method column to report costs of special meetings or 2. Enter a decrease of $5,000 on the same

of allocation documented in the organization’s

other activities that relate to fundraising or line in the Total column, representing the

records.

specific program services. special fundraising event expenses already

Report, in the appropriate column, Column (D)—Fundraising.—Fundraising reported on line 9b in Part I;

expenses that are directly attributable to a

expenses represent the total expenses 3. Enter $70,000 on the same line in the

particular functional category. In general,

incurred in soliciting contributions, gifts, Program services column;

allocate expenses that relate to more than grants, etc. Report as fundraising expenses

one functional category. For example, allocate 4. Enter $10,000 on the same line in the

all expenses, including allocable overhead Fundraising column; and

employees’ salaries on the basis of each

costs, incurred in: (a) publicizing and

employee’s time. For some shared expenses conducting fundraising campaigns; 5. Enter a decrease of $85,000 on the

such as occupancy, supplies, and (b) soliciting bequests and grants from same line in the Management and general

depreciation of office equipment, use an column, representing the allocations to

foundations or other organizations, or

appropriate basis for each kind of cost. functional areas other than management and

government grants reportable on line 1c; (c)

However, you should report some other participating in federated fundraising general.

shared expenses in column (C) only. The campaigns; (d) preparing and distributing After making these allocations, the column

column instructions below discuss allocating (C) total (line 44, column (C)) would be

fundraising manuals, instructions, and other

expenses. $65,000, consisting of the $50,000 aggregate

materials; and (e) conducting special

Column (A)—Total.—For column (A), total fundraising events that generate contributions amount and the $15,000 allocation of the

each line item of columns (B), (C), and (D) in reportable on line 1a in addition to revenue



Page 11

aggregate cost center expenses to organization’s books of account and on line appropriate form for each plan. File the form

management and general. 20. by the last day of the 7th month after the

The above is an example of a simple Line 23—Specific assistance to plan year ends. See General Instruction D15.

one-step allocation that shows how to report individuals.—Enter the amount of payments Line 28—Other employee benefits.—Enter

the allocation in Part II. This reporting method to, or for the benefit of, particular clients or the organization’s contributions to employee

would actually be needed more in the case of patients, including assistance rendered by benefit programs (such as insurance, health,

multiple step allocations in which two or more others at the expense of the filing and welfare programs) that are not an

cost centers are involved. The total expenses organization. Do not include grants to other incidental part of a pension plan included on

of the first would be allocated to the other organizations that select the person or line 27. Also see General Instruction D15 and

functions, including an allocation of part of persons to receive the assistance available the instructions for Form 5500.

these expenses to the second cost center. through the use of the grant funds. For Line 29—Payroll taxes.—Enter the amount

The expenses of the second cost center example, report a payment to a hospital to of Federal, state, and local payroll taxes for

would then be allocated to other functions cover the medical expenses of a particular the year, but only those taxes that are

and any remaining cost centers to be individual on line 23, but do not report a imposed on the organization as an employer.

allocated, and so on. The greater the number contribution to a hospital to provide some This includes the employer’s share of social

of these cost centers that are allocated out, service to the general public or to unspecified security and Medicare taxes, the Federal

the more difficult it is to preserve the object charity patients on this line. Also, do not unemployment tax (FUTA), state

classification identity of the expenses of each include scholarship, fellowship, or research unemployment compensation taxes, and

cost center (e.g., salaries, interest, supplies, grants to individuals even though selected by other state and local payroll taxes. Do not

etc.). The reporting method described above the grantor organization. Report these grants include taxes withheld from employees’

avoids this problem. on line 22 instead. salaries and paid to the various governmental

Note: The intent of the above instructions is Attached schedule.—Attach a schedule units such as Federal and state income taxes

only to facilitate reporting indirect expenses showing the total payments for each and the employees’ shares of social security

by both object classification and function. particular class of activity, such as food, and Medicare taxes.

These instructions do not in any way permit shelter, and clothing for indigents or disaster Line 30—Professional fundraising fees.—

the allocation to other functions of expenses victims; medical, dental, and hospital fees Enter the organization’s fees to outside

that should be reported as management and and charges; and direct cash assistance to fundraisers for solicitation campaigns they

general expenses. indigents. For payments to indigent families, conducted, or for consultation services

Line 22—Grants and allocations.—Enter the do not identify the individuals. connected with a solicitation of contributions

amount of awards and grants to individuals Line 24—Benefits paid to or for by the organization itself.

and organizations selected by the filing members.—For an organization that provides Line 31—Accounting fees.—Enter the total

organization. United Way and similar benefits to members or dependents (such as accounting and auditing fees charged by

fundraising organizations should include organizations exempt under section 501(c)(8), outside firms and individuals who are not

allocations to member agencies. (9), or (17)), attach a schedule. Show amounts employees of the reporting organization.

Report voluntary awards and grants to of: (a) death, sickness, hospitalization, or

Line 32—Legal fees.—Enter the total legal

affiliated organizations for specific (restricted) disability benefits; (b) unemployment

fees charged by outside firms and individuals

purposes or projects also on line 22, but not compensation benefits; and (c) other benefits

who are not employees of the reporting

required payments to affiliates reportable on (state their nature). Do not report the cost of

organization. Do not include any penalties,

line 16. employment-related benefits the organization

fines, or judgments imposed against the

provides its officers and employees on this

Report scholarship, fellowship, and organization as a result of legal proceedings.

line. Report those expenses on lines 27 and

research grants to individuals on line 22. 28. Report those expenses on line 43, Other

Certain other payments to or for the benefit expenses.

of individuals may be reportable on line 23 Line 25—Compensation of officers,

Line 33—Supplies.—Enter the total for office,

instead. See the instructions for line 23 for directors, etc.—Enter the total compensation

classroom, medical, and other supplies used

specific information. paid to officers, directors, trustees, and key

during the year, as determined by the

employees for the year. In Part V, give the

Report only the amount of actual grants organization’s normal method of accounting

name and compensation (if any) of each

and awards on line 22. Report expenses for supplies.

officer, director, trustee, and key employee,

incurred in selecting recipients or monitoring Line 34—Telephone.—Enter the total

along with the other information requested. If

compliance with the terms of a grant or telephone, telegram, and similar expenses for

no compensation was paid, enter a zero.

award on lines 25 through 43. the year.

Each person listed should report this

Attached schedule.—Attach a schedule of compensation on his or her income tax Line 35—Postage and shipping.—Enter the

amounts reported on line 22. Show on the return, unless the Code specifically excludes total amount of postage, parcel delivery,

schedule: (a) each class of activity; any of the payments from income tax. See trucking, and other delivery expenses,

(b) donee’s name and address and the Publication 525 for more information. See including the cost of shipping materials.

amount given; and (c) (in the case of grants Part V instructions for a definition of “key

to individuals) relationship of donee if related Line 36—Occupancy.—Enter the total

employee.” amount paid or incurred for the use of office

by blood, marriage, adoption, or employment

(including employees’ children) to any person Form 941 must be filed to report income space or other facilities, heat, light, power,

or corporation with an interest in the tax withholding and social security and and other utilities (other than telephone

Medicare taxes. The organization must also expenses reported on line 34), outside

organization, such as a creator, donor,

director, trustee, officer, etc. file Form 940 to report Federal unemployment janitorial services, mortgage interest, real

taxes, unless the organization is not subject estate taxes, and similar expenses. Do not

On the schedule, classify activities in more include depreciation (reportable on line 42) or

to these taxes. See Circular E, Employer’s

detail than in such broad terms as charitable, Tax Guide, for more information. See also the any salaries of the reporting organization’s

educational, religious, or scientific. For own employees (reportable on line 26).

100% penalty discussion in General

example, identify payments for nursing Instruction D for Form 941.

services, laboratory construction, or Line 37—Equipment rental and

fellowships. Line 26—Other salaries and wages.—Enter maintenance.—Enter the cost of renting and

the total of employees’ salaries not reported maintaining office equipment and other

If property other than cash is given and its on line 25. equipment, except for automobile and truck

fair market value when the organization gave expenses reportable on lines 35 and 39.

it is the measure of the award or grant, also Line 27—Pension plan contributions.—

Enter the employer’s share of contributions Line 38—Printing and publications.—Enter

show on the schedule: (a) a description of the

property; (b) its book value; (c) how the book that the organization paid to qualified and the printing and related costs of producing

nonqualified pension plans for the year. the reporting organization’s own newsletters,

value was determined; (d) how the fair market

value was determined; and (e) the date of the Complete Form 5500 or 5500-C/R, as leaflets, films, and other informational

appropriate, for the organization’s plan and materials. However, do not include any

gift. Record any difference between fair

market value and book value in the file as a separate return. If the organization expenses, such as salaries or postage, for

has more than one plan, complete the which a separate line is provided in Part II.

Page 12

Also include the cost of any purchased column (C) total on line 14; and the column figures are not readily available from the

publications. (D) total on line 15. organization’s records. In that event, please

Line 39—Travel.—Enter the total travel Reporting of joint costs.—Organizations that indicate that the information provided is an

expenses, including transportation costs included in program service expenses estimate.

(fares, mileage allowances, and automobile (column (B) of Part II) any joint costs from a a. Donated services or facilities.—If the

expenses), meals and lodging, and per diem combined educational campaign and organization reports, on line 82b, the value of

payments. fundraising solicitation must disclose how the any donated services or use of materials,

Line 40—Conferences, conventions, and total joint costs of all such combined equipment, or facilities it received, it can also

meetings.—Enter the total expenses incurred activities were reported in Part II. indicate in Part III the amount received and

by the organization in conducting meetings Organizations answering “Yes” to the utilized for specific program services.

relating to its activities. Include such joint-cost question following line 44 must However, disclose the applicable amounts

expenses as the rental of facilities, speakers’ furnish the relevant financial data in the only on the lines for the narrative description

fees and expenses, and printed materials. spaces provided. of the appropriate program services. Do not

However, do not include on this line the An organization conducts a combined include these amounts in the expense column

salaries and travel expenses of the reporting educational campaign and fundraising in Part III.

organization’s own officers, directors, solicitation when it solicits contributions (by b. Attached schedule.—Attach a schedule

trustees, and employees who participate. mail, telephone, broadcast media, or any that lists the organization’s other program

Include the registration fees (but not travel other means) and includes with the services and the total expenses incurred for

expenses) paid for sending any of the solicitation educational material or other each. For this schedule, you need not give

organization’s staff to conferences, meetings, information that furthers a bona fide the detailed information as required in Part III

or conventions conducted by other nonfundraising exempt purpose of the for the four largest services.

organizations. organization. Reporting expenses optional for certain

Line 41—Interest.—Enter the total interest Expenses attributable to information organizations.—Only section 501(c)(3) and (4)

expense for the year, excluding any interest regarding the organization itself, its use of organizations and section 4947(a)(1)

attributable to rental property (reported on past contributions, or its planned use of charitable trusts must enter the total

line 6b) or any mortgage interest treated as contributions received are not program expenses of each program service they

occupancy expense on line 36. service expenses and should not be included reported in Part III. Reporting the expense

Line 42—Depreciation, depletion, etc.—If in column (B). This is true whether or not the totals is optional for all other organizations.

the organization records depreciation, organization accounts for joint costs in

depletion, and similar expenses, enter the accordance with the AICPA’s Statement of Part IV—Balance Sheets.—

total for the year. Include any depreciation Position 87-2, “Accounting for Joint Costs of All organizations, except those that meet one

(amortization) of leasehold improvements. The Informational Materials and Activities of of the exceptions in General Instruction F,

organization is not required to use the Not-for-Profit Organizations That Include a must complete all of Part IV and may not

Modified Accelerated Cost Recovery System Fund-Raising Appeal” (New York, N.Y., submit a substitute balance sheet. Failure to

(MACRS) to compute the depreciation AICPA, 1989). Any method of allocating joint complete Part IV may result in penalties for

reported on Form 990. If the organization costs to program service expenses must be filing an incomplete return. See General

records depreciation using MACRS, attach reasonable under the facts and Instruction K. See General Instruction E for

Form 4562, Depreciation and Amortization, or circumstances of each case. Most states with more information about completing a Form

a schedule showing the same information reporting requirements for charitable and 990 to be filed with any state or local

required by Form 4562. If it does not use other organizations that solicit contributions government agency.

MACRS, attach a schedule showing how you either require or allow the reporting of joint

When a schedule must be attached for any

computed depreciation. costs in accordance with Statement of

line item in Part IV, the schedule is required

Position 87-2 standards.

For an explanation of acceptable methods only for the end-of-year balance sheet figure

for computing depreciation, see Publication Part III—Statement of Program reported in column (B). Similarly, give the

534, Depreciation, or Publication 946, How end-of-year figures for any receivables or

To Begin Depreciating Your Property. In

Service Accomplishments.— depreciable assets and the related allowance

addition, see the Instructions for Form 4562 Provide the information specified in the for doubtful accounts or accumulated

for a schedule that may be used to compute heading of Part III for each of the depreciation reported within the description

depreciation. organization’s four largest program services column.

Use the same method of computing (as measured by total expenses incurred) or Line 45—Cash—non-interest-bearing.—

depreciation on line 42 that is used for the for each program service if the organization Enter the total of non-interest-bearing

balance sheet, Part IV, of this Form 990. engaged in four or fewer of such activities. If checking accounts, deposits in transit,

part of the total expenses of any program change funds, petty cash funds, or any other

If the organization claims a deduction for

service consists of grants and allocations non-interest-bearing account. Do not include

depletion, attach a schedule explaining the

reported on line 22, indicate the amount of advances to employees or officers or

deduction.

the grants and allocations in the space refundable deposits paid to suppliers or

Line 43—Other expenses.—Indicate the type provided. Section 501(c)(3) and (4) others.

and amount of each significant expense for organizations and section 4947(a)(1)

which a separate line is not provided. Report Line 46—Savings and temporary cash

charitable trusts must show the amount of

all other miscellaneous expenses as a single investments.—Enter the total of

grants and allocations to others.

total. Expenses that might be reported here interest-bearing checking accounts, savings

A program service is a major, usually and temporary cash investments, such as

include: investment counseling and other

ongoing objective of an organization, such as money market funds, commercial paper,

professional fees not reportable on lines 30

adoptions, recreation for the elderly, certificates of deposit, and U.S. Treasury bills

through 32; penalties, fines, and judgments;

rehabilitation, or publication of journals or or other governmental obligations that mature

unrelated business income taxes; and real

newsletters. Specify the service outputs, in less than one year. Report the income from

estate taxes not attributable to rental property

products, or other measures of a program these investments on line 4.

or reported as occupancy expenses. Attach a

service, such as clients served, days of care,

schedule if more space is needed. Line 47—Accounts receivable.—Enter the

therapy sessions, or publications issued.

Some states that accept Form 990 in total accounts receivable (reduced by the

Indicate the number of outputs or products

satisfaction of their filing requirements may allowance for doubtful accounts) that arose

rendered, such as 4,080 counseling contacts.

require that certain types of miscellaneous from the sale of goods and/or the

If it is inappropriate to measure a quantity performance of services. Report claims

expenses be itemized regardless of amount.

of output, as in a research activity, describe against vendors or refundable deposits with

See General Instruction E.

the objective of the activity for this time suppliers or others here, if not significant in

Line 44—Total functional expenses.— Add period as well as the overall longer-term goal. amount. Otherwise, report them on line 58,

lines 22 through 43 and enter the totals in Other assets. Report any receivables due

Reasonable estimates may be furnished for

columns (A), (B), (C), and (D). Report the from officers, directors, trustees, or key

the statistical information (number of clients,

column (B) total on line 13 of Part I; the employees on line 50. Report receivables

patients, etc.) called for by Part III if exact

Page 13

(including loans and advances) due from director, trustee, or key employee of the listing and describing each of these

other employees on line 58. organization. investments held at the end of the year.

Line 48—Pledges receivable.—Enter the Notes receivable from loans by a credit Show the book value for each and indicate

total pledges receivable recorded as of the union to its members, and scholarship loans whether the investment is listed at cost or

beginning and end of the year, reduced by by a section 501(c)(3) organization, do not end-of-year market value. Report the income

the amount of pledges estimated to be have to be itemized. Merely identify these from these assets on line 7. Do not include

uncollectible. loans as such on a schedule and indicate the program-related investments. See instructions

total amount of such loans that are for line 58.

Line 49—Grants receivable.—Enter the total

grants receivable from governmental outstanding. Line 57—Land, buildings, and equipment.—

agencies, foundations, and other For a note receivable from another Enter the book value (cost or other basis less

organizations as of the beginning and end of organization exempt under the same accumulated depreciation) of all land,

the year. paragraph of section 501(c) as the filing buildings, and equipment owned by the

organization, list only the name of the organization and not held for investment. This

Line 50—Receivables due from officers, includes any property, plant, and equipment

directors, trustees, and key employees.— borrower and the balance due. For example,

a section 501(c)(3) organization would have to owned and used by the organization in

Report all receivables due from officers,

provide the full details of a loan to a section conducting its exempt activities. Attach a

directors, trustees, and key employees and all schedule listing these fixed assets held at the

secured and unsecured loans to such 501(c)(4) organization but would have to

provide only the name of the borrower and end of the year and showing, for each item or

persons on line 50 and in an attached category listed, the cost or other basis,

schedule described below. See Part V the balance due on a note arising from a loan

to another section 501(c)(3) organization. accumulated depreciation, and book value.

instructions for a definition of “key employee.”

Loans receivable.—Enter the gross Line 58—Other assets.—List and show the

Attached schedule.— book value of each category of assets not

amount of loans receivable, less the

a. When loans should be reported allowance for doubtful accounts, arising from reportable on lines 45 through 57. Attach a

separately.—In the required schedule, report the normal activities of the filing organization separate schedule if more space is needed.

each loan separately, even if more than one

such as loans by a credit union to its One type of asset reportable on line 58 is

loan was made to the same person or the members or scholarship loans by a section program-related investments. These are

same terms apply to all loans. Report salary 501(c)(3) organization. A schedule of these investments made primarily to accomplish

advances, and other advances for the loans is not required. some exempt purpose of the filing

personal use and benefit of the recipient, and

Report loans to officers, directors, trustees, organization rather than to produce income.

receivables subject to special terms or arising

from nontypical transactions, as separate and key employees on line 50. Report loans Line 59—Total assets.—Enter the total of

loans for each officer, director, etc. to other employees on line 58. lines 45 through 58. The amounts on line 59

Line 52—Inventories for sale or use.— must equal the amounts on line 75 for both

b. When loans should be reported as a

Enter the amount of materials, goods, and the beginning and end of year.

single total.—Report receivables that are

subject to the same terms and conditions supplies purchased or manufactured by the Line 60—Accounts payable and accrued

(including credit limits and rate of interest) as organization and held for future sale or use. expenses.—Enter the total of accounts

receivables due from the general public and Line 53—Prepaid expenses and deferred payable to suppliers and others and accrued

that arose during the normal course of the charges.—Enter the amount of short-term expenses, such as salaries payable, accrued

organization’s operations as a single total for and long-term prepayments of expenses payroll taxes, and interest payable.

all the officers, directors, trustees, and key attributable to one or more future accounting Line 61—Grants payable.—Enter the unpaid

employees. Report travel advances for official periods. Examples include prepayments of portion of grants and awards that the

business of the organization as a single total. rent, insurance, and pension costs, and organization has made a commitment to pay

c. Schedule format.—For each expenses incurred for a solicitation campaign other organizations or individuals, whether or

outstanding loan or other receivable that must of a future accounting period. not the commitments have been

be reported separately, the attached schedule Line 54—Investments—securities.—Enter communicated to the grantees.

should show the following information the book value, which may be market value, Line 62—Support and revenue designated

(preferably in columnar form): of securities held as investments. Attach a for future periods.—Enter the amount of

1. Borrower’s name and title, schedule that lists the securities held at the contributions, governmental fees or grants,

end of the year. Indicate whether the grants from foundations or other

2. Original amount, securities are listed at cost (including the organizations, and other fees and support

3. Balance due, value recorded at the time of receipt in the that contributors or grantors have designated

4. Date of note, case of donated securities) or end-of-year as payable for or applicable to one or more

5. Maturity date, market value. Debt securities of the U.S., future years, either by the terms of the gift or

state, and municipal governments, corporate by the terms of the contract or other

6. Repayment terms, stocks and bonds, and other publicly traded arrangement. Do not include any amounts

7. Interest rate, securities (defined in the instructions for line restricted for future use by the filing

8. Security provided by the borrower, 8) do not have to be listed individually, except organization’s own governing body. Attach a

for stock holdings that represent 5% or more schedule that describes each contribution or

9. Purpose of the loan, and

of the outstanding shares of stock of the grant designated for one or more future

10. Description and fair market value of the same class. However, show separate totals periods and indicates the total amount of

consideration furnished by the lender (for for each type of security (U.S. Government each item and the amount applicable to each

example, cash—$1,000; or 100 shares of obligations, corporate stocks, etc.). Do not future period.

XYZ, Inc. common stock—$9,000). include amounts reported on line 46. Line 63—Loans from officers, directors,

The above detail is not required for Line 55—Investments—land, buildings, and trustees, and key employees.—Enter the

receivables or travel advances that may be equipment.—Enter the book value (cost or unpaid balance of loans received from

reported as a single total. See paragraph (b) other basis less accumulated depreciation) of officers, directors, trustees, and key

above. However, report and identify those all land, buildings, and equipment held for employees. See the instructions for Part V for

totals separately on the attachment. investment purposes, such as rental definition of “key employee.” For loans

Line 51—Other notes and loans properties. Attach a schedule listing these outstanding at the end of the year, attach a

receivable.—Enter the combined total of fixed assets held at the end of the year and schedule that provides (for each loan) the

notes receivable and net loans receivable. held as investments. Show for each item or name and title of the lender and the

Notes receivable.—Enter the amount of all category listed, the cost or other basis, information listed in items (2) through (10) of

notes receivable not listed on line 50 and not accumulated depreciation, and book value. the instructions for line 50.

acquired as investments. Attach a schedule Report the income from these assets on line Line 64—Mortgages and other notes

similar to that called for in the instructions for 6a. payable.—Enter the amount of mortgages

line 50. The schedule should also identify the Line 56—Investments—other.—Enter the and other notes payable at the beginning and

relationship of the borrower to any officer, amount of all other investment holdings not end of the year. Attach a schedule showing,

reported on line 54 or 55. Attach a schedule as of the end of the year, the total amount of

Page 14

all mortgages payable and, for each more than one fund is involved. On the 1992 compensation package of one or more

nonmortgage note payable, the name of the attachment, show the beginning- and officers, directors, trustees, and key

lender and the other information specified in end-of-year fund balance for each fund listed. employees.

items (2) through (10) of the instructions for b. Organizations not using fund Column (C).—Enter salary, fees, bonuses,

line 50. The schedule should also identify the accounting.—If the organization does not and severance payments received by each

relationship of the lender to any officer, use fund accounting, check the box above person listed. Include current year payments

director, trustee, or key employee of the line 71 and report account balances on lines of amounts reported or reportable as deferred

organization. 71 through 73. Report net assets on line 74. compensation in any prior year.

Line 65—Other liabilities.—List and show Also complete line 75 to report the sum of Column (D).—Include all forms of deferred

the amount of each liability not reportable on the total liabilities and net assets. compensation (whether or not funded;

lines 60 through 64. Attach a separate Line 71—Capital stock or trust principal.— whether or not vested; and whether or not

schedule if more space is needed. For corporations, enter the balance per books the deferred compensation plan is a qualified

Line 66—Total liabilities.—Enter the total of for capital stock accounts. Show par or plan under section 401(a)) and payments to

lines 60 through 65. stated value (or for stock with no par or welfare benefit plans on behalf of the officers,

Lines 67 through 74—Fund balances or net stated value, total amount received upon etc. Reasonable estimates may be used if

assets.— issuance) of all classes of stock issued and, precise cost figures are not readily available.

as yet, uncancelled. For trusts, enter the Unless the amounts are reported in column

a. Organizations using fund amount in the trust principal or corpus

accounting.—If the organization uses fund (C), include salary and other compensation

account. earned during the period covered by the

accounting, check the box above line 67 and

complete lines 67 through 70 to report the Line 72—Paid-in or capital surplus.—Enter return but not paid by the date the return was

various fund balances. Complete line 74 to the balance per books for all paid-in capital in filed.

report the sum of the fund balances and excess of par or stated value for all stock Column (E).—Enter expense allowances or

complete line 75 to report the sum of the issued and, as yet, uncancelled. If reimbursements that the recipients must

total liabilities and fund balances. stockholders or others gave donations that report as income on their separate income

the organization records as paid-in capital, tax returns. Examples include amounts for

Organizations not using fund accounting include them here. Report any current-year

should see instruction (b) (above the line 71 which the recipient did not account to the

donations you included on line 72 in Part I, organization or allowances that were more

instruction given below). line 1. than the payee spent on serving the

Under fund accounting, an organization

Line 73—Retained earnings or organization. Include payments made under

segregates its assets, liabilities, and net

accumulated income.—For a corporation, indemnification arrangements, the value of

assets into separate funds according to

enter the balance in the retained earnings or the personal use of housing, automobiles, or

externally imposed restrictions on the use of

similar account, minus the cost of any other assets owned or leased by the

certain assets; similar designations by the

corporate treasury stock. For trusts, enter the organization (or provided for the

organization’s governing board; and other

balance per books in the accumulated organization’s use without charge), as well as

amounts that are unrestricted as to use. Each

income or similar account. any other taxable and nontaxable fringe

fund is like a separate entity in that it has a

Line 74—Total fund balances or net benefits. Refer to Publication 525 for more

self-balancing set of accounts showing

assets.—For organizations that use fund information.

assets, liabilities, equity (fund balance),

revenue, and expenses. Since these funds accounting, enter the total of lines 67 through Compensation from related

are actually part of a single entity, they are all 70. For all other organizations, enter the total organizations.—Answer this question “Yes”

included in that organization’s own financial of lines 71 through 73. Enter the only if an officer, director, trustee, or key

statements. Similar accounts in the various beginning-of-the-year figure of line 74, employee of your organization received more

funds may or may not be consolidated in column (A) in Part I, line 19. The than $10,000 in compensation from related

those statements according to the end-of-the-year figure of line 74, column (B) organizations (defined below) AND such

organization’s preference and practice. Parts must agree with the figure on line 21 of Part I. compensation when added to the

I, II, IV, and VII of this form, however, require Line 75—Total liabilities and fund compensation provided to that individual by

such consolidation. Recognition of the balances/net assets.—Enter the total of lines your organization totaled more than $100,000.

separate funds and the net changes within 66 and 74. That amount must equal the For this purpose, “compensation” includes

the various funds during the year is amount for total assets reported on line 59 for any amount that would be reportable in

accomplished by the fund balances section both the beginning and end of the year. column (C), (D), or (E) of Part V if provided by

(lines 67 through 70) of the balance sheet. your organization.

Some states that accept Form 990 as their

Part V—List of Officers, Organizations answering “Yes” must attach

basic report form may require a separate Directors, Trustees, and Key a schedule that lists, for each officer, director,

statement of changes in fund balances. See Employees.— trustee, or key employee receiving such

General Instruction E. compensation, the name of each related

List each of the organization’s officers, organization that provided the compensation

Lines 67a and 67b—Current funds.— Enter directors, trustees, and key employees. List and the amount each provided. Report in the

the fund balances per books of the current all of these persons even if they did not same format as required by columns (C)

unrestricted fund and the current restricted receive any compensation from the through (E) of Part V.

fund. organization. Enter “-0-” in columns (C), (D), A “related organization” is any entity

Line 68—Land, building, and equipment and (E) if none was paid. (For deferred (whether tax-exempt or taxable) that your

fund.—Enter the fund balance per books for compensation, see column (D) instructions.) organization directly or indirectly owns or

the land, building, and equipment fund (plant Use an attachment if there are more than 4 controls, or that directly or indirectly owns or

fund). persons to list in Part V. controls your organization. For example, if

Line 69—Endowment fund.—Enter the total A “key employee” is any person having Organization A owns 90% of B, and B owns

of the fund balances for the permanent responsibilities or powers similar to those of 80% of C, then A would directly own 90% of

endowment fund and any term endowment officers, directors, or trustees. The term B and indirectly own 72% (90% of 80%) of C.

funds. Report annuity and life income fund includes the chief management and “Owns” means holding (directly or

balances on this line if not significant in administrative officials of an organization indirectly) 50% or more of the voting

amount, or, report them on line 70. Do not (such as an executive director or chancellor) membership rights, voting stock, profits

include the fund balances of any but does not include the heads of separate interest, or beneficial interest.

quasi-endowment funds (funds functioning as departments or smaller units within an

endowment) or other internally designated “Control” means that:

organization.

funds. a. Fifty percent (50%) or more of your

Show all forms of cash and noncash organization’s officers, directors, trustees, or

Line 70—Other funds.—Enter the total of the compensation received by each listed officer,

fund balances for all funds not reported on key employees are also officers, directors,

etc., whether paid currently or deferred. In trustees, or key employees of the second

lines 67 through 69. Indicate the type of fund addition to completing Part V, you may

in the space provided or on an attachment if organization being tested for control;

provide an attachment describing the entire

Page 15

b. Your organization appoints 50% or more copy of the entire revised organizing chamber of commerce described in section

of the officers, directors, trustees, or key instrument or governing document. 501(c)(6). The civic organization should

employees of the second organization; or Line 78—Unrelated business income.— answer “No” on line 80 if it does not require

c. Fifty percent (50%) or more of your Check “Yes” on line 78a if the organization’s its members to belong to the chamber of

organization’s officers, directors, trustees, or total gross income from all of its unrelated commerce.

key employees are appointed by the second trades and businesses is $1,000 or more for Also disregard affiliation with any statewide

organization. the year. Gross income is gross receipts less or nationwide organization. Thus, the civic

Whether or not any elements of ownership the cost of goods sold. See Publication 598 organization in the above example would still

or control are present, a related organization for a description of unrelated business answer “No” on line 80 even if it belonged to

also includes: income and the Form 990-T filing a state or national federation of similar

requirements for section 501(c), 501(e), 501(f), organizations. A local labor union whose

1. A supporting organization operated in

and 501(k) organizations having such income. members are also members of a national

connection with your organization where one

Form 990-T is not a substitute for Form 990. labor organization would answer “No” on line

of the purposes of the supporting

Report on Form 990 items of income and 80.

organization is to benefit or further the

expense also reported on Form 990-T when Line 81—Expenditures for political

purposes of your organization; and

the organization is required to file both forms. purposes.—A political expenditure is one

2. A supported organization operated in

Note: All tax-exempt organizations must pay intended to influence the selection,

connection with your organization where one

estimated taxes with respect to their unrelated nomination, election, or appointment of

of the purposes of your organization is to

business income if they expect their tax anyone to a Federal, state, or local public

benefit or further the purposes of the

liability to be $500 or more. Use Form 990-W office, or office in a political organization, or

supported organization.

to compute this tax. the election of Presidential or Vice

For example, a hospital auxiliary that raises Presidential electors. Whether the attempt

Line 78c.—If you answer “Yes” to this

funds for Hospital Y or coordinates the efforts succeeds does not matter.

question, complete Part IX, Information

of that hospital’s volunteer staff would be a

Regarding Taxable Subsidiaries. An expenditure includes a payment,

supporting organization of Hospital Y and,

Line 79—Liquidation, dissolution, distribution, loan, advance, deposit, or gift of

thus, a related organization even if the

termination, or substantial contraction.—If money, or anything of value. It also includes a

hospital does not own or control the auxiliary.

there was a liquidation, dissolution, contract, promise, or agreement to make an

Hospital Y, in turn, would be a supported

termination, or substantial contraction, attach expenditure, whether or not legally

organization of the auxiliary. In any case

a statement explaining what took place. enforceable.

where the $10,000 and $100,000 minimums

were met, the hospital must report (on an For a complete liquidation of a corporation a. All section 501(c) organizations.—

attachment to its return) the compensation or termination of a trust, write Final Return at Section 501(c) organizations must file Form

paid by the auxiliary to the officer, director, the top of the organization’s Form 990. On 1120-POL if their political expenditures and

trustee, or key employee of the hospital. The the attached statement, show whether the their net investment income both exceed

same reporting requirement would apply to assets have been distributed and the date. $100 for the year.

compensation paid by Hospital Y to an Also attach a certified copy of any resolution, Section 501(c) organizations that

officer, etc., of the auxiliary. or plan of liquidation or termination, etc., with maintained separate segregated funds

all amendments or supplements not already described in section 527(f)(3) should refer to

Part VI—Other Information.— filed. In addition, attach a schedule listing: the the instructions for Form 1120-POL for filing

Note: Section 501(c)(3) organizations and names and addresses of all persons who requirements.

section 4947(a)(1) charitable trusts must also received the assets distributed in liquidation b. Section 501(c)(3) organizations.—A

complete and attach Schedule A (Form 990). or termination, the kinds of assets distributed section 501(c)(3) organization will lose its

See General Instruction D1. to each one, and each asset’s fair market tax-exempt status if it engages in political

value. activity.

Line 76—Change in activities.—Attach a

statement explaining any significant changes A substantial contraction is a partial A section 501(c)(3) organization must pay

in the kind of activities the organization liquidation or other major disposition of an excise tax for any amount paid or incurred

conducts to further its exempt purpose. assets except transfers for full consideration on behalf of, or in opposition to, any

These new or modified activities are those not or distributions from current income. candidate for public office. The organization

listed as current or planned in the A major disposition of assets means any must pay an additional excise tax if it fails to

organization’s application for recognition of disposition for the tax year that is: correct the expenditure timely.

exemption; or those not yet reported to the a. At least 25% of the fair market value of A manager of a section 501(c)(3)

IRS by a letter to its key district director or by the organization’s net assets at the beginning organization who knowingly agrees to a

an attachment to the organization’s return for of the tax year; or political expenditure must pay an excise tax,

any earlier year. Besides describing new unless the agreement is not willful and there

activities or changes to current ones, also b. One of a series of related dispositions

begun in earlier years that, together, add up is reasonable cause. A manager who does

describe any major program activities that are not agree to a correction of the political

being discontinued. to at least 25% of the net assets the

organization had at the beginning of the tax expenditure may have to pay an additional

Line 77—Changes in organizing or year when the first disposition in the series excise tax.

governing documents.—Attach a conformed was made. Whether a major disposition of When an organization promotes a

copy of any changes to the articles of assets took place through a series of related candidate for public office (or is used or

incorporation, constitution, trust instrument, dispositions depends on the facts in each controlled by a candidate or prospective

or other organizing document, or to the case. candidate), amounts paid or incurred for the

bylaws or other governing document. following purposes are political expenditures:

See Regulations section 1.6043-3 for

A “conformed” copy is one that agrees with special rules and exceptions. 1. Remuneration to the individual (a

the original document and all amendments to candidate or prospective candidate) for

it. If the copies are not signed, they must be Line 80—Relation to other organizations.—

Answer “Yes” if most of the organization’s speeches or other services;

accompanied by a written declaration signed

by an officer authorized to sign for the governing body, officers, trustees, or 2. Travel expenses of the individual;

organization, certifying that they are complete membership are also officers, directors, 3. Expenses of conducting polls, surveys,

and accurate copies of the original trustees, or members of any other or other studies, or preparing papers or other

documents. organization. material for use by the individual;

Photocopies of articles of incorporation Disregard a coincidental overlap of 4. Expenses of advertising, publicity, and

showing the certification of an appropriate membership with another organization; that fundraising for such individual; and

state official do not have to be accompanied is, when membership in one organization is

not a condition of membership in another 5. Any other expense that has the primary

by such a declaration. See Rev. Proc. 68-14, effect of promoting public recognition or

1968-1 C.B. 768, for more information. When organization. For example, assume that a

majority of the members of a section 501(c)(4) otherwise primarily accruing to the benefit of

a number of changes are made, attach a the individual.

civic organization also belong to a local

Page 16

Use Form 4720 to figure and report the including the governing instrument and Part VII—Analysis of

excise taxes. bylaws, allows discrimination on the basis of

race, color, or religion.

Income-Producing Activities.—

Line 82—Donated services or facilities.—

Because Form 990 is open to public However, section 501(i) allows social clubs An organization is exempt from income taxes

inspection, you may want the return to show to retain their exemption under section only if its primary purpose is to engage in the

contributions the organization received in the 501(c)(7) even though their membership is type of activity for which it claims exemption.

form of donated services or the use of limited (in writing) to members of a particular An exempt organization is subject to a tax

materials, equipment, or facilities at less than religion if: on unrelated business taxable income if such

fair rental value. If so, and if the 1. The social club is an auxiliary of a income is from a trade or business which is

organization’s records either show the fraternal beneficiary society that is exempt regularly carried on by the organization and

amount and value of such items or give a under section 501(c)(8) and limits its which is not substantially related to the

clearly objective basis for an estimate, you membership to the members of a particular organization’s performance of its exempt

may enter the information on line 82b. The religion; or purpose or function. Generally, a tax-exempt

IRS does not require any organization to keep organization with gross income of $1,000 or

such records. Do NOT include the value of 2. The social club’s membership limitation more for the year from an unrelated trade or

is a good-faith attempt to further the business must file Form 990-T and pay any

such items in Part I or II or in the expense

column in Part III. However, you may indicate teachings or principles of that religion, and tax due.

the limitation is not intended to exclude

the value of donated services or use of In Part VII, show whether revenue, also

materials, equipment, or facilities in Part III in individuals of a particular race or color.

reportable on lines 2 through 11 of Part I, was

the narrative description of program services If the club answered “Yes,” to the question received from activities related to the

rendered. See the instructions for Part III. on line 86c and section 501(i) applies, organization’s purpose or activities unrelated

Line 84a.—All organizations that qualify under indicate in an attached statement which of to its exempt purpose. Enter gross amounts

the above exceptions of section 501(i) unless indicated otherwise. Show also any

section 170(c) to receive contributions that

are deductible as charitable contributions for applies. revenue excludable from the definition of

Federal income tax purposes, enter N/A. Line 87—Section 501(c)(12) unrelated business taxable income.

Line 85—Section 501(c)(5) or (6) organizations.—One of the requirements that The sum of amounts entered in columns

organizations.—Attempts to influence the an organization must meet to qualify under (b), (d), and (e) for lines 93 through 103 of

opinion of the general public, or any segment section 501(c)(12) is that at least 85% of its Part VII should match amounts entered for

gross income consists of amounts collected correlating lines 2 through 11 of Part I. Use

of the general public, on legislative matters or

referendums constitute grassroots lobbying. from members for the sole purpose of the following table to verify the relationship of

Such lobbying may be explicit, as in an meeting losses and expenses. For purposes Part VII with Part I. Note that contributions

of section 501(c)(12), the term “gross income” that are reportable on lines 1a through 1d of

advertisement that urges the public to

means gross receipts minus cost of goods Part I are not reportable in Part VII.

contact legislators for the purpose of

sold.

proposing, supporting, or opposing Amounts in Correspond to

legislation. Grassroots lobbying may also be For a mutual or cooperative electric or

telephone company, “gross income” does not Part VII on Amounts in

implicit in any advertisement or other Line Part I on Line

communication directed at the public if the include amounts received or accrued as

communication is an attempt to mold public “qualified pole rentals” or from the 93(a) through (g) 2

opinion on a legislative matter or referendum. prepayment of a loan under the Rural 94 3

Any lobbying directed at the members of the Electrification Act of 1936 (see section 95 4

organization is not grassroots lobbying. 501(c)(12)(B), (C), and (D)).

96 5

Lobbying directed at “potential” members, For a mutual or cooperative telephone

employees of members, or stockholders of company, “gross income” also does not 97 and 98 6c

members would be grassroots lobbying. See include amounts received or accrued either 99 7

Regulations section 1.162-20(c) for a from another telephone company for 100 8d

discussion of grassroots lobbying. completing long distance calls to or from or

101 9c

Line 86—Section 501(c)(7) organizations.— between the telephone company’s members,

or from the sale of display listings in a 102 10c

a. Gross receipts test.—A section

directory furnished to the telephone 103(a) through (e) 11

501(c)(7) organization may receive up to 35%

company’s members. 105 (plus line 1d, Part I) 12

of its gross receipts, including investment

income, from sources outside its membership Line 88—Public interest law firms.—A

and remain tax exempt. Part of the 35% (up public interest law firm exempt under section Completing Part VII.—

to 15% of gross receipts) may be derived 501(c)(3) or 501(c)(4) must attach a statement Column (a).—In column (a), identify any

from public use of a social club’s facilities. that lists the cases in litigation, or that have unrelated business taxable income reportable

been litigated during the year. For each case, in column (b) by selecting a business code

For this purpose, “gross receipts” are the

describe the matter in dispute and explain from the Codes for Unrelated Business

club’s income from its usual activities. The

term includes charges, admissions, how the litigation will benefit the public Activity in the Instructions for Form 990-T.

membership fees, dues, assessments, generally. Also attach a report of all fees Column (b).—In column (b), enter any

investment income (such as dividends, rents, sought and recovered in each case. See Rev. revenue received from activities unrelated to

and similar receipts), and normal recurring Proc. 92-59, 1992-29 I.R.B. 11, about the exempt purpose of the organization. A

capital gains on investments. Gross receipts acceptance of attorney’s fees. detailed discussion of income that constitutes

do not include capital contributions (as Line 89—List of states.—List each state with unrelated business taxable income can be

defined in Regulations section 1.118-1), which the organization is filing a copy of this found in the Instructions for Form 990-T and

initiation fees, or unusual amounts of income return in full or partial satisfaction of state Publication 598. If you enter an amount in

such as income received from the club’s filing requirements. column (b), then you must enter a business

selling its clubhouse. Although gross receipts Line 92—Section 4947(a)(1) charitable code in column (a).

usually do not include initiation fees, these trusts.—Section 4947(a)(1) charitable trusts Column (c).—In column (c), select an

should be included for college fraternities or that file Form 990 instead of Form 1041 must exclusion code, from the Exclusion Codes list

sororities or other organizations that charge complete this line. The trust should include on the last page of these instructions to

membership initiation fees, but not annual exempt-interest dividends received from a identify any revenue excludable from

dues. mutual fund or other regulated investment unrelated business taxable income. If more

If the 35% and 15% limits do not affect the company as well as tax-exempt interest than one exclusion code is applicable to a

club’s exempt status, include the income received directly. particular revenue item, select the lowest

from line 86b on the club’s Form 990-T. numbered exclusion code that applies. If

b. Nondiscrimination policy.—A section nontaxable revenues from several sources are

501(c)(7) organization is not exempt from reportable on the same line in column (d), use

income tax if any written policy statement, the exclusion code that applies to the largest



Page 17

revenue source. If the list of exclusion codes 94 through 96 are discussed in the line 11, Part I. In the appropriate columns,

does not include an item of revenue that is instructions for Part I, lines 3 through 5. enter the revenue received from these

excludable from unrelated business taxable Lines 97 and 98.—Report net rental income activities. Select applicable business and

income, enter that item in column (e) and see from investment property on these lines. Also exclusion codes. Report as “Other revenue,”

the instruction for column (e). report here rental income from unaffiliated on line 11 of Part I, the total revenue entered

Column (d).—For column (d), identify any exempt organizations. However, report rental in columns (b), (d), and (e) for lines 103(a)

revenue received that is excludable from income from an exempt function (program through (e).

unrelated business taxable income as defined service) on line 93. Refer to the instructions Line 105.—Enter the total revenue reported

in the Exclusion Codes list on the last page of for Part I, line 6. A more detailed discussion on line 104 for columns (b), (d), and (e). The

these instructions. If you enter an amount in of rental income is given in the Instructions amount reported on line 105, plus the amount

column (d), then you must enter an exclusion for Form 990-T and Publication 598. on line 1d of Part I, should equal the amount

code in column (c). Rents from real property are usually entered for “Total revenue” on line 12 of

Column (e).—For column (e), report any excluded in computing unrelated business Part I.

revenue from activities related to the taxable income, as are incidental amounts of

organization’s exempt purpose; that is, rental income from personal property leased

Part VIII—Relationship of

income received from activities that form the with real property (mixed lease). Generally, Activities to the

basis of the organization’s exemption from rents from personal property are incidental if Accomplishment of Exempt

taxation. Also report here any revenue that is they do not exceed 10% of the total rents

excludable from gross income other than by from all leased property. In a mixed lease

Purposes.—

Code section 512, 513, or 514, such as where the rent attributable to personal To explain how an amount entered in Part VII,

interest on state and local bonds that is property is more than 50% of the total rent, column (e) was related or exempt function

excluded from tax by section 103. Explain in neither rent from real or personal property is income, show the line number of the amount

Part VIII how any amount reported in column excluded from unrelated business taxable in column (e) and give a brief description of

(e) related to the accomplishment of the income. Nor does the exclusion apply when how the activity reported in column (e)

organization’s exempt purposes. the real or personal property rentals depend contributed importantly to the

Lines 93(a) through (f).—List the wholly or partly on the income or profits from accomplishment of your exempt purposes

organization’s revenue-producing program leased property, other than an amount based (other than by providing funds for such

service activities on these lines. Program on a fixed percentage or percentage of gross purposes). Activities that generate

service activities are primarily those that form receipts or sales. exempt-function income are activities that

the basis of an organization’s exemption from The rental exclusion from unrelated form the basis of the organization’s

tax. In the appropriate columns, enter gross business taxable income does not apply to exemption from tax.

revenue from each program service activity debt-financed real property. In general, Also give the line number and an

and the business and exclusion codes that debt-financed property is any property that explanation for any income you entered in

identify this revenue. See the explanation of the organization finances by debt and holds column (e) that is specifically excluded from

program service revenue in the instructions to produce income instead of for exempt gross income other than by Code sections

for Part I, line 2. purposes. An exempt organization’s income 512, 513, or 514. If you did not enter an

Line 93(g).—Enter, in the appropriate from debt-financed property is treated as amount in column (e), do not complete

columns, gross revenue from fees paid by unrelated business taxable income and is Part VIII.

government agencies for a service, facility, or subject to tax in the same proportion as the Example: M, an organization described in

product that benefited the government property remains financed by the debt. If section 501(c)(3), operates a school for the

agency primarily, either economically or substantially all (85% or more) of any performing arts. Admission is charged at

physically. Do not include government grants property is used for an organization’s exempt student performances. M reported admission

that enabled your organization to benefit the purposes, the property is not treated as income in column (e) of Part VII and explained

public directly and primarily. See Part I, line debt-financed property. The rules for in Part VIII that performances before an

1c instructions for the distinction between debt-financed property do not apply to rents audience were an essential part of the

government grants that represent from personal property. students’ training and related to the exempt

contributions and fees from government Lines 99 through 102.—In the appropriate purpose of the organization.

agencies that are payments for services. columns, report the revenue received for Because M also reported interest from

Report on line 2 of Part I (program service these line items. General instructions for lines state bonds in column (e) of Part VII, M

revenue) the sum of the entries in columns 99 through 102 are discussed in the explained in Part VIII that such interest was

(b), (d), and (e) for lines 93(a) through (g). instructions for Part I, lines 7 through 10. excluded from gross income by Code

Lines 94 through 96.—In the appropriate Lines 103(a) through (e).—List any “Other section 103.

columns, report the revenue received for revenue” activity on these lines. These

these line items. General instructions for lines activities are discussed in the instructions for Part IX—Information Regarding

Taxable Subsidiaries.—

Complete this Part if question 78c of Part VI,

Other Information, was answered “Yes.”









Page 18

Exclusion Codes



General Exceptions 16— Real property rental income that does not Debt-financed Income

depend on the income or profits derived

01— Income from an activity that is not by the person leasing the property and is 30— Income exempt from debt-financed

regularly carried on (section 512(a)(1)) excluded by section 512 (b)(3) (section 514) provisions because at

least 85% of the use of the property is

02— Income from an activity in which labor is 17— Rent from personal property leased with for the organization’s exempt purposes

a material income-producing factor and real property and incidental (10% or less) (Note: This code is only for income

substantially all (at least 85%) of the in relation to the combined income from from the 15% or less non-exempt

work is performed with unpaid labor the real and personal property (section purpose use.) (section 514(b)(1)(A))

(section 513(a)(1)) 512(b)(3))

31— Gross income from mortgaged property

03— Section 501(c)(3) organization— Income 18— Proceeds from the sale of investments used in research activities described in

from an activity carried on primarily for and other non-inventory property (capital section 512(b)(7), (8), or (9) (section

the convenience of the organization’s gains excluded by section 512(b)(5)) 514(b)(1)(C))

members, students, patients, visitors,

officers, or employees (hospital parking 19— Income (gains) from the lapse or 32— Gross income from mortgaged property

lot or museum cafeteria, for example) termination of options to buy or sell used in any activity described in

(section 513(a)(2)) securities (section 512(b)(5)) section 513(a)(1), (2), or (3) (section

514(b)(1)(D))

04— Section 501(c)(4) local association of 20— Income from research for the United

employees organized before 5/27/69— States; its agencies or instrumentalities; 33— Income from mortgaged property

Income from the sale of work-related or any state or political subdivision (neighborhood land) acquired for

clothes or equipment and items normally (section 512(b)(7)) exempt purpose use within ten years

sold through vending machines; food (section 514(b)(3))

dispensing facilities; or snack bars for 21— Income from research conducted by a

college, university, or hospital (section 34— Income from mortgaged property

the convenience of association members acquired by bequest or devise (applies

at their usual places of employment 512(b)(8))

to income received within ten years

(section 513(a)(2)) 22— Income from research conducted by an from the date of acquisition) (section

05— Income from the sale of merchandise, organization whose primary activity is 514(c)(2)(B))

substantially all of which (at least 85%) conducting fundamental research, the

results of which are freely available to 35— Income from mortgaged property

was donated to the organization (section acquired by gift where the mortgage

513(a)(3)) the general public (section 512(b)(9))

was placed on the property more than

23— Income from services provided under five years previously and the property

Specific Exceptions license issued by a Federal regulatory was held by the donor for more than

06— Section 501(c)(3), (4), or (5) organization agency and conducted by a religious five years (applies to income received

conducting an agricultural or educational order or school operated by a religious within ten years from the date of gift

fair or exposition—Qualified public order, but only if the trade or business (section 514(c)(2)(B))

entertainment activity income (section has been carried on by the organization

since before May 27, 1959 (section 512 36— Income from property received in

513(d)(2)) return for the obligation to pay an

(b)(15))

07— Section 501(c)(3), (4), (5), or (6) annuity described in section 514(c)(5)

organization—Qualified convention and Foreign Organizations

37— Income from mortgaged property that

trade show activity income (section 24— Foreign organizations only—Income from provides housing to low and moderate

513(d)(3)) a trade or business NOT conducted in income persons, to the extent the

08— Income from hospital services described the United States and NOT derived from mortgage is insured by the Federal

in section 513(e) United States sources (patrons) (section Housing Administration (section

512(a)(2)) 514(c)(6)) (Note: In many cases, this

09— Income from noncommercial bingo would be exempt function income

games that do not violate state or local Social Clubs and VEBAs reportable in column (e). It would not

law (section 513(f)) be so in the case of a section 501(c)(5)

25— Section 501(c)(7), (9), (17), or (20) or (6) organization, for example, that

10— Income from games of chance organization—Non-exempt function acquired the housing as an investment

conducted by an organization in North income set aside for a charitable, etc., or as a charitable activity.)

Dakota (section 311 of the Deficit purpose specified in section 170(c)(4)

Reduction Act of 1984, as amended) (section 512(a)(3)(B)(i)) 38— Income from mortgaged real property

owned by: a school described in

11— Section 501(c)(12) organization— 26— Section 501(c)(7), (9), (17), or (20) section 170(b)(1)(A)(ii); a section

Qualified pole rental income (section organization—Proceeds from the sale of 509(a)(3) affiliated support organization

513(g)) exempt function property that was or will of such a school; a section 501(c)(25)

be timely reinvested in similar property organization, or by a partnership in

12— Income from the distribution of low-cost (section 512(a)(3)(D))

articles in connection with the solicitation which any of the above organizations

of charitable contributions (section 27— Section 501(c)(9), (17), or (20) owns an interest if the requirements of

513(h)) organization—Non-exempt function section 514(c)(9)(B)(vi) are met (section

income set aside for the payment of life, 514(c)(9))

13— Income from the exchange or rental of sick, accident, or other benefits (section Special Rules

membership or donor list with an 512(a)(3)(B)(ii))

organization eligible to receive charitable 39— Section 501(c)(5) organization— Farm

contributions by a section 501(c)(3) Veterans’ Organizations income used to finance the operation

organization; by a war veterans’ and maintenance of a retirement home,

organization; or an auxiliary unit or 28— Section 501(c)(19) organization— hospital, or similar facility operated by

society of, or trust or foundation for, a Payments for life, sick, accident, or the organization for its members on

war veterans’ post or organization health insurance for members or their property adjacent to the farm land

(section 513(h)) dependents that are set aside for the (section 1951(b)(8)(B) of Public Law

payment of such insurance benefits or 94-455)

Modifications and Exclusions for a charitable, etc., purpose specified

in section 170(c)(4) (section 512(a)(4)) Trade or Business

14— Dividends, interest, payments with

respect to securities loans, annuities, 29— Section 501(c)(19) organization— 40— Gross income from an unrelated

income from notional principal contracts, Income from an insurance set-aside activity that is regularly carried on but,

and other substantially similar income (see code 28 above) that is set aside in light of continuous losses sustained

from ordinary and routine investments for payment of insurance benefits or over a number of tax periods, cannot

excluded by section 512(b)(1) for a charitable, etc., purpose specified be regarded as being conducted with

in section 170(c)(4) (Regs. 1.512(a)– the motive to make a profit (not a trade

15— Royalty income excluded by section or business)

512(b)(2) 4(b)(2))

Page 19