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IRS Forms - 990 _ 990 EZ - Instructions for Form 990 and Form 990 EZ

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IRS Forms - 990 _ 990 EZ - Instructions for Form 990 and Form 990 EZ Powered By Docstoc
					2007                                                                                                                                 Department of the Treasury
                                                                                                                                     Internal Revenue Service



Instructions for Form 990
and Form 990-EZ
Return of Organization Exempt From Income Tax and ..
Short Form Return of Organization Exempt From Income Tax
Under Section 501(c), 527, or 4947(a)(1) of the Internal Revenue Code
(except black lung benefit trust or private foundation)
Caution: Form 990-EZ is for use by organizations other than sponsoring organizations and controlling organizations defined in section
512(b)(13), with gross receipts of less than $100,000 and total assets of less than $250,000 at the end of the year.
Section references are to the Internal Revenue Code unless otherwise noted.


Contents                                               Page     Contents                                        Page       provide the IRS with the information
• What’s New . . . . . . . . . . . . .         .   .   . . .1   S Organizations in Foreign                                 required by section 6033.
• Purpose of Form . . . . . . . . .            .   .   . . .1     Countries and U.S.                                            An organization’s completed Form
• Phone Help . . . . . . . . . . . . .         .   .   . . .1     Possessions . . . . . . . . . . . .         . . . . 20   990, Form 990-EZ, and the Form 990-T
• Email Subscription . . . . . . . .           .   .   . . .1   T Public Interest Law Firms . . .             . . . . 20   of 501(c)(3) organizations is available
• Photographs of Missing                                        U Political Organizations . . . . .           . . . . 20   for public inspection as required by
  Children . . . . . . . . . . . . . . . .     . . . . .2       V Information Regarding                                    section 6104. Schedule B (Form 990,
• General Instructions . . . . . . .           . . . . .2         Transfers Associated with                                990-EZ, or 990-PF), Schedule of
                                                                  Personal Benefit Contracts . .              . . . . 20   Contributors, is open for public
A Who Must File . . . . . . . . . . .          . . . . .2                                                                  inspection for section 527 organizations
B Organizations Not Required                                    W Prohibited Tax Shelter
                                                                                                                           filing Form 990 or Form 990-EZ. For
  to File Form 990 or Form                                        Transactions and Related                                 other organizations that file Form 990
  990-EZ . . . . . . . . . . . . . . . .       . . . . .3         Disclosure Requirements . . .               . . . . 21   or Form 990-EZ, parts of Schedule B
C Exempt Organization                                           X Requirements for a Properly                              may be open to public inspection. See
  Reference Chart . . . . . . . . .            . . . . .4         Completed Form 990 or                                    the Instructions for Schedule B for more
D Forms and Publications . . . .               . . . . .5         Form 990-EZ . . . . . . . . . . . .         . . . . 22   details.
E Use of Form 990, or Form                                      • Specific Instructions for Form                                Some members of the public rely on
  990-EZ, To Satisfy State                                        990 and Table of Contents                                Form 990, or Form 990-EZ, as the
  Reporting Requirements . . . .               . . . . .6         for These Specific                                       primary or sole source of information
F Other Forms as Partial                                          Instructions . . . . . . . . . . . . .      . . . . 24   about a particular organization. How the
  Substitutes for Form 990 or                                   • Specific Instructions for Form                           public perceives an organization in
  Form 990-EZ . . . . . . . . . . . .          . . . . .7         990-EZ and Table of                                      such cases may be determined by the
G Accounting Periods and                                          Contents for These Specific                              information presented on its return.
  Methods . . . . . . . . . . . . . . .        . . . . .7         Instructions . . . . . . . . . . . . .      . . . . 54   Therefore, the return must be complete,
                                                                • Index . . . . . . . . . . . . . . . . . .   . . . . 66   accurate, and fully describe the
H When, Where, and How to                                                                                                  organization’s programs and
  File . . . . . . . . . . . . . . . . . . .   . . . . .8                                                                  accomplishments.
I Extension of Time To File . . .              . . . . .8
                                                                                                                                Use Form 990 or Form 990-EZ, to
J Amended Return/Final                                          What’s New                                                 send a required election to the IRS,
  Return . . . . . . . . . . . . . . . . .     . . . . .8       New annual electronic filing                               such as the election to capitalize costs
K Failure to File Penalties . . . .            . . . . .9       requirement for small tax-exempt                           under section 266.
L Contributions . . . . . . . . . . . .        . . . . .9       organizations. Most small tax-exempt
M Public Inspection of                                          organizations must now file new Form
  Returns, etc. . . . . . . . . . . . .        . . . . 12       990-N, Electronic Notice (e-Postcard)                      Phone Help
N Disclosures Regarding                                         for Tax-Exempt Organizations Not
                                                                                                                           If you have questions and/or need help
  Certain Information and                                       Required to File Form 990 or 990-EZ.
                                                                                                                           completing Form 990, or Form 990-EZ,
  Services Furnished . . . . . . .             . . . . 15       See the IRS website at www.irs.gov
                                                                                                                           please call 1-877-829-5500. This
O Disclosures Regarding                                         and click on the Charities & Non-Profits
                                                                                                                           toll-free telephone service is available
  Certain Transactions and                                      tab for more information.
                                                                                                                           Monday through Friday.
  Relationships . . . . . . . . . . . .        . . . . 15
P Intermediate Sanction
  Regulations — Excess                                          Purpose of Form                                            Email Subscription
  Benefit Transactions . . . . . .             . . . . 15       Form 990 and Form 990-EZ are used                          The IRS has established a new
Q Erroneous Backup                                              by tax-exempt organizations,                               subscription-based email service for tax
  Withholding . . . . . . . . . . . . .        . . . . 20       nonexempt charitable trusts, and                           professionals and representatives of
R Group Return . . . . . . . . . . .           . . . . 20       section 527 political organizations to                     tax-exempt organizations. Subscribers

                                                                                 Cat. No. 22386X
will receive periodic updates from the       990-EZ. If the organization is a            Form 990-EZ. However, section
IRS regarding exempt organization tax        sponsoring organization, or a               501(c)(15) insurance companies are
law and regulations, available services,     controlling organization within the         also subject to separate tests to
and other information. To subscribe,         meaning of section 512(b)(13), it must      determine whether they qualify as
visit www.irs.gov/eo.                        file Form 990. However, if the              tax-exempt for the tax year. The
                                             organization is a supporting                following tests use a specific definition
                                             organization described in section           for gross receipts defined, below only
Photographs of Missing                       509(a)(3), it generally must file Form      for purposes of the following tests.
                                             990 (Form 990-EZ if applicable) even if     Insurance companies that do not qualify
Children                                     its gross receipts are normally $25,000,    as tax-exempt must file Form 1120-PC,
The Internal Revenue Service is a            or less. Supporting organizations of        U.S. Property and Casualty Insurance
proud partner with the National Center       religious organizations need not file       Company Income Tax Return, or Form
for Missing and Exploited Children.          Form 990 (or Form 990-EZ) if their          1120, U.S. Corporation Income Tax
Photographs of missing children              gross receipts are normally $5,000, or      Return, as taxable entities. See Notice
selected by the Center may appear in         less. See the gross receipts discussion     2006-42, which is on page 878 of the
instructions on pages that would             in General Instruction B.                   Internal Revenue Bulletin 2006-19 at
otherwise be blank. You can help bring           If the organization’s gross receipts    www.irs.gov/pub/irs-irbs/irb06-19.pdf.
these children home by looking at the        during the year are less than $100,000      Tests for section 501(c)(15)
photographs and calling                      and its total assets at the end of the      insurance companies to qualify as
1-800-THE-LOST (1-800-843-5678) if           year are less than $250,000, it may file    tax-exempt for the tax year. If any
you recognize a child.                       Form 990-EZ instead of Form 990.            section 501(c)(15) insurance company
                                             Even if the organization meets this test,   (other than life insurance) normally has
                                             it can still file Form 990.                 gross receipts of more than $25,000 for
General Instructions                             Organizations required to file
                                                                                         the tax year and meets both parts of
                                                                                         the following test, then the company
The General Instructions apply to both       Schedule A (Form 990 or 990-EZ),
                                                                                         can file Form 990 (or Form 990-EZ, if
Form 990 and Form 990-EZ. See also           Organization Exempt Under Section
                                                                                         applicable).
the Specific Instructions for each of        501(c)(3), that do not meet the support
these forms.                                 tests discussed in the instructions for         1. The company’s gross receipts
                                             Part IV of that schedule can contact the    must be equal to or less than $600,000,
        Certain Form 990 filers must file    IRS at the following address to             and
  !     electronically, see General
CAUTION Instruction H for who must file
                                             re-evaluate their determination-of-filing       2. The company’s premiums must
                                             requirements.                               be more than 50% of its gross receipts.
electronically.
                                                                                            If the company did not meet this test
                                               Internal Revenue Service                  and the company is a mutual insurance
A. Who Must File                               TE/GE EO Determinations                   company, then it must meet the
                                               P.O. Box 2508                             Alternate test to qualify to file Form 990
Filing Tests                                   Cincinnati, OH 45201                      (or Form 990-EZ, if applicable).
Organizations exempt from income tax                                                     Otherwise, the company must file Form
under Internal Revenue Code section          Section 501(a), (e), (f), (k), and          1120 or Form 1120-PC, as appropriate.
501(a), which includes sections 501(c),      (n) Organizations                              Alternate test. If any section
501(e), 501(f), 501(k), 501(n), and          Except for those types of organizations     501(c)(15) insurance company (other
4947(a)(1) must generally file Form 990      listed in General Instruction B, an         than life insurance) is a mutual
or Form 990-EZ based on their gross          annual return on Form 990, or Form          insurance company and it did not meet
receipts for the tax year. (See General      990-EZ, is required from every              the above test, then the company must
Instruction B next for exceptions to the     organization exempt from tax under          meet both parts of the following
filing requirement.) For this purpose,       section 501(a), including foreign           alternate test.
gross receipts is the organization’s total   organizations and cooperative service           1. The company’s gross receipts
revenues from all sources during its         organizations described in sections         must be equal to or less than $150,000,
annual accounting period, without            501(e) and (f); child care organizations    and
subtracting any costs or expenses.           described in section 501(k); and                2. The company’s premiums must
                                             charitable risk pools described in          be more than 35% of its gross receipts.
          However, in addition to the        section 501(n).
  !       above filing test, 501(c)(15)
 CAUTION insurance companies are                 Section 501(c)(3), 501(e), (f), (k),       If the company does not meet either
subject to a separate series of tests to     and (n) organizations must also attach      test, then it must file Form 1120-PC or
determine whether small insurance            a completed Schedule A (Form 990 or         Form 1120 (if the company is not
companies qualify as tax exempt under        990-EZ) to their Form 990 or Form           entitled to insurance reserves) instead
section 501(c)(15) for the tax year.         990-EZ.                                     of Form 990 or Form 990-EZ.
These separate tests use a different                For purposes of these                        The alternate test does not
definition for gross receipts only for
purposes of determining whether such
                                              TIP instructions, the term section           !     apply if any employee of the
                                                                                         CAUTION mutual insurance company or a
                                                    501(c)(3) includes organizations
insurance companies qualify as tax           exempt under sections 501(e), (f), (k),     member of the employee’s family is an
exempt. See Section 501(c)(15)               and (n).                                    employee of another company that is
Organizations below for additional                                                       exempt under section 501(c)(15)(or
information.                                 Section 501(c)(15)                          would be exempt if this provision did
    If the organization does not meet        Organizations                               not apply).
any of the exceptions listed in General      A section 501(c)(15) organization              Gross receipts. To determine
Instruction B, and its annual gross          applies the same gross receipts test as     whether a section 501(c)(15)
receipts are normally more than              other organizations to determine            organization satisfies either of the
$25,000, it must file Form 990 or Form       whether they must file the Form 990 or      above tests, figure gross receipts by
                                                                -2-         General Instructions for Form 990 and Form 990-EZ
adding (1) premiums (including                Disregarded Entities                         an organization may continue to be
deposits and assessments) without             A disregarded entity, as described in        deductible by the general public until
reduction for return premiums or              Regulations sections 301.7701-1              the IRS publishes a notice to the
premiums paid for reinsurance; (2)            through 301.7701-3, is treated as a          contrary in the Internal Revenue
gross investment income of a non-life         branch or division of its parent             Bulletin.
insurance company (as described in            organization for federal tax purposes.
section 834(b)); and (3) other items that     Therefore, financial and other
are included in the filer’s gross income      information applicable to a disregarded
under Subchapter B, Chapter 1,                entity must be reported as the parent
                                                                                           B. Organizations Not
Subtitle A of the Code. This definition       organization’s information.                  Required To File Form 990 or
does not, however, include
contributions to capital. For more            Section 4947(a)(1) Nonexempt                 990-EZ
information, see Notice 2006-42, which        Charitable Trusts                                   Organizations not required to
is on page 878 of the Internal Revenue        Any nonexempt charitable trust
Bulletin 2006-19 at www.irs.gov/pub/
                                                                                            TIP file Form 990, or Form 990-EZ
                                              (described in section 4947(a)(1)) not                with the IRS may wish to use it
irs-irbs/irb06-19.pdf.                        treated as a private foundation is also      to satisfy state reporting requirements.
                                              required to file Form 990, or Form           For details, see General Instruction E.
   Premiums consist of all amounts
                                              990-EZ, along with a completed
received as a result of entering into an
                                              Schedule A (Form 990 or 990-EZ). See             The following types of organizations
insurance contract. For information
                                              the discussion in General Instruction D
about the reporting of premiums, see                                                       exempt from tax under section 501(a)
                                              for exceptions to filing Form 1041, U.S.
the instructions for Form 990 Part I, line                                                 (section 527 for political organizations)
                                              Income Tax Return for Estates and
2.                                                                                         do not have to file Form 990, or Form
                                              Trusts.
                                                                                           990-EZ, with the IRS. However, if the
   Anti-abuse rule. The anti-abuse            If an Organization’s Exemption               organization chooses to file a Form 990
rule, found in section 501(c)(15)(C),
explains how gross receipts (including
                                              Application Is Pending                       or Form 990-EZ, it must also attach the
                                              If the organization’s application for        schedules and statements described in
premiums) from all members of a
                                              exemption is pending, check the              the instructions for these forms. In
controlled group are aggregated in
figuring the above tests.                     Application pending box in the heading       addition, an organization not required to
                                              of the return and complete the return.       file Form 990 or 990-EZ because it
                                                                                           meets exceptions 12, 15, or 16 must
Political Organizations                       Organizations That Filed a                   file new Form 990-N, Electronic Notice
Tax-exempt political organizations must       Return in the Prior Year but Are             (e-Postcard) for Tax-Exempt
file Form 990 or Form 990-EZ (if              Not Required To File in the                  Organizations Not Required to File
applicable) unless the organization is        Current Year                                 Form 990 or 990-EZ.
excepted from filing under Exemption
14 or 15 of General Instruction B. A          Organizations that previously filed Form
                                              990 or Form 990-EZ and meet                  1. A church, an interchurch organization of
qualified state or local political
                                              exemption 15 under General Instruction          local units of a church, a convention or
organization (defined below) must file                                                        association of churches, an integrated
Form 990 (not Form 990-EZ) only if it         B do not have to file a return.
                                                                                              auxiliary of a church (such as a men’s or
has gross receipts of $100,000 or                Exempt organizations that filed Form         women’s organization, religious school,
more.                                         990, or Form 990-EZ, but are no longer          mission society, or youth group).
                                              required to file because they meet a         2. A church-affiliated organization that is
Qualified state or local political            specific exemption (other than                  exclusively engaged in managing funds
organizations. A qualified political          exemption 15 in General Instruction B)          or maintaining retirement programs and
organization meets all of the following       must advise their IRS area office so            is described in Rev. Proc. 96-10, 1996-1
requirements.                                 their filing status can be updated.             C.B. 577.
    1. The organization’s exempt                 Exempt organizations that are not         3. A school below college level affiliated
functions are solely for the purpose of       sure of their area office may call the          with a church or operated by a religious
influencing or attempting to influence                                                        order.
                                              IRS at 1-877-829-5500. Exempt
the selection, nomination, election, or                                                    4. A mission society sponsored by, or
                                              organizations that stop filing Form 990,
appointment of any individual to any                                                          affiliated with, one or more churches or
                                              or Form 990-EZ, without notifying their         church denominations, if more than half
state or local public office or office in a   area office may receive service center
state or local political organization.                                                        of the society’s activities are conducted
                                              correspondence inquiring about their            in, or directed at, persons in foreign
    2. The organization is subject to         returns. When responding to these
state law that requires it to report the                                                      countries.
                                              inquiries, these organizations must give     5. An exclusively religious activity of any
information that is similar to that           the specific reason for not filing.             religious order.
required on Form 8872.
                                                                                           6. A state institution whose income is
    3. The organization files the             Failure To File and Its Effect on               excluded from gross income under
required reports with the state.              Contributions                                   section 115.
    4. The state makes such reports           Organizations that are eligible to           7. An organization described in section
public and the organization makes them        receive tax deductible contributions are        501(c)(1). A section 501(c)(1)
open to public inspection in the same         listed in Publication 78, Cumulative List       organization is a corporation organized
manner that organizations must make           of Organizations described in Section           under an Act of Congress that is:
Form 8872 available for public                170(c) of the Internal Revenue Code of          • An instrumentality of the United
inspection.                                   1986. An organization may be removed            States, and
                                              from this listing if our records show that      • Exempt from federal income taxes.
    For additional information, including     it is required to file Form 990, or Form     8. A private foundation exempt under
the prohibition of involvement in the         990-EZ, but it does not file a return or        section 501(c)(3) and described in
organization of a federal candidate or        advises us that it is no longer required        section 509(a). Use Form 990-PF,
office holder, see section 527(e)(5).         to file. However, contributions to such         Return of Private Foundation.

General Instructions for Form 990 and Form 990-EZ                -3-
9. A black lung benefit trust described in         Gross Receipts                               3 tax years (including the year in which
    section 501(c)(21). Use Form 990-BL,                                                        the return would be filed).
    Information and Initial Excise Tax Return               Do not use the definition of
    for Black Lung Benefit Trusts and
    Certain Related Persons.                         !      gross receipts described in
                                                    CAUTION General Instruction A, under
                                                                                                $5,000 Gross Receipts Test
10. A stock bonus, pension, or profit-sharing                                                   To determine if an organization’s gross
                                                   Section 501(c)(15) Organizations to          receipts are normally $5,000 or less,
    trust that qualifies under section 401.
                                                   figure gross receipts.                       apply the following test. An
    Use Form 5500, Annual Return/Report
    of Employee Benefit Plan.                          Gross receipts are the total amounts     organization’s gross receipts normally
11. A religious or apostolic organization          the organization received from all           are considered to be $5,000 or less if
    described in section 501(d). Use Form          sources during its annual accounting         the organization is:
    1065, U.S. Return of Partnership               period, without subtracting any costs or        1. Up to a year old and has
    Income.                                        expenses.                                    received, or donors have pledged to
12. A foreign organization whose annual            Gross receipts when acting as an             give, $7,500 or less during its first tax
    gross receipts from sources within the         agent. If a local chapter of a section       year;
    U.S. are normally $25,000 or less (Rev.
                                                   501(c)(8) fraternal organization collects       2. Between 1 and 3 years old and
    Proc. 94-17, 1994-1 C.B. 579). See the
    $25,000 Gross Receipts Test below.
                                                   insurance premiums for its parent lodge      averaged $6,000 or less in gross
13. A governmental unit or affiliate of a          and merely sends those premiums to           receipts during each of its first 2 tax
    governmental unit described in Rev.            the parent without asserting any right to    years; or
    Proc. 95-48, 1995-2 C.B. 418.                  use the funds or otherwise deriving any         3. Three years old or more and
14. A political organization that is:              benefit from collecting them, the local      averaged $5,000 or less in gross
    • A state or local committee of a political    chapter does not include the premiums        receipts for the immediately preceding
    party;                                         in its gross receipts. The parent lodge      3 tax years (including the year in which
                                                   reports them instead. The same               the return would be filed).
    • A political committee of a state or local    treatment applies in other situations in
    candidate;
                                                   which one organization collects funds
    • A caucus or association of state or          merely as an agent for another.
    local officials;                                                                            C. Exempt Organization
    • An authorized committee (as defined          Figuring Gross Receipts                      Reference Chart
    in section 301(6) of the Federal Election      Figure gross receipts for Form 990 and
    Campaign Act of 1971) of a candidate           Form 990-EZ as follows.                                To determine how the
    for federal office;                            Form 990. Gross receipts are the sum          TIP instructions for Form 990 and
    • A national committee (as defined in          of lines 1e, 2, 3, 4, 5, 6a, 7, 8a (both            Form 990-EZ apply to the
    section 301(14) of the Federal Election        columns), 9a, 10a, and 11 of Part I.         organization, you must know the Code
    Campaign Act of 1971) of a political           Gross receipts can also be figured by        section under which the organization is
    party;                                         adding back the amounts on lines 6b,         exempt.
    • A United States House of                     8b (both columns), 9b, and 10b to the        Type of                                            I.R.C.
    Representatives or United States Senate        total revenue reported on line 12.           Organization                                     Section
    campaign committee of a political party
    committee;                                     Form 990-EZ. Gross receipts are the          Corporations Organized Under Act of
                                                   sum of lines 1, 2, 3, 4, 5a, 6a, 7a, and 8     Congress . . . . . . . . . . . . . . . . . . . 501(c)(1)
    • Required to report under the Federal         of Part I. Gross receipts can also be        Title Holding Corporations . . . . . . . . . 501(c)(2)
    Election Campaign Act of 1971 as a
    political committee (as defined in section
                                                   figured by adding back the amounts on        Charitable, Religious, Educational,
    301(4) of such Act); or                        lines 5b, 6b, and 7b to the total revenue      Scientific, etc., Organizations . . . . . . 501(c)(3)
                                                   reported on line 9.
    • An organization described under                                                           Civic Leagues and Social Welfare
    section 6033(g)(3)(G).                             Example. Organization M reported           Organizations . . . . . . . . . . . . . . . . 501(c)(4)
15. Except for supporting organizations            $50,000 as total revenue on line 9 of its    Labor, Agricultural, and Horticultural
    described in section 509(a)(3), an             Form 990-EZ. M added back the costs            Organizations . . . . . . . . . . . . . . . . 501(c)(5)
    organization whose gross receipts are          and expenses it had deducted on lines
                                                                                                Business Leagues, etc. . . . . . . . . . . . 501(c)(6)
    normally $25,000 or less.                      5b ($2,000); 6b ($1,500); and 7b ($500)
16. A section 509(a)(3) supporting                 to its total revenue of $50,000 and          Social and Recreation Clubs . . . . . . . . 501(c)(7)
    organization of a religious organization, if   determined that its gross receipts for       Fraternal Beneficiary and Domestic              501(c)(8)
    the supporting organization’s gross            the tax year were $54,000.                     Fraternal Societies and Associations            & (10)
    receipts are normally $5,000 or less.                                                       Voluntary Employees’ Beneficiary
                                                   $25,000 Gross Receipts Test                    Associations . . . . . . . . . . . . . . . . . 501(c)(9)
How to Determine If an                             To determine if an organization’s gross
                                                                                                Teachers’ Retirement Fund Associations 501(c)(11)
                                                   receipts are normally $25,000 or less,
Organization’s Gross                               apply the following test. An                 Benevolent Life Insurance Associations,
Receipts are Normally                              organization’s gross receipts normally         Mutual Ditch or Irrigation Companies,
                                                                                                  Mutual or Cooperative Telephone
$25,000 (or $5,000) or Less                        are considered to be $25,000 or less if        Companies, etc. . . . . . . . . . . . . . . 501(c)(12)
To figure whether an organization has              the organization is:
                                                                                                Cemetery Companies . . . . . . . . . . . . 501(c)(13)
to file Form 990-EZ (or Form 990) apply               1. Up to a year old and has
                                                                                                State Chartered Credit Unions, Mutual
the $25,000 (or $5,000) gross receipts             received, or donors have pledged to            Reserve Funds . . . . . . . . . . . . . . . 501(c)(14)
test (below) using the following                   give, $37,500 or less during its first tax
                                                   year;                                        Insurance Companies or Associations
definition of gross receipts and                                                                  Other Than Life . . . . . . . . . . . . . . . 501(c)(15)
information in Figuring Gross Receipts                2. Between 1 and 3 years old and
below.                                             averaged $30,000 or less in gross            Cooperative Organizations To Finance
                                                   receipts during each of its first 2 tax        Crop Operations . . . . . . . . . . . . . . 501(c)(16)
                                                   years; or                                    Supplemental Unemployment Benefit
                                                      3. Three years old or more and              Trusts . . . . . . . . . . . . . . . . . . . . . 501(c)(17)
                                                   averaged $25,000 or less in gross            Employee Funded Pension Trusts
                                                   receipts for the immediately preceding        (created before 6/25/59) . . . . . . . . . 501(c)(18)

                                                                      -4-          General Instructions for Form 990 and Form 990-EZ
Organizations of Past or Present        501(c)(19)         Other Forms That May Be                     including the definition of responsible
  Members of the Armed Forces . . . . .   & (23)           Required                                    persons.
Black Lung Benefit Trusts . . . . . . . . . . 501(c)(21)                                               Form 990-T. Exempt Organization
                                                           Schedule A (Form 990 or 990-EZ).
                                                                                                       Business Income Tax Return (and
Withdrawal Liability Payment Funds . . . 501(c)(22)        Organization Exempt Under Section
                                                                                                       proxy tax under section 6033(e)). Filed
Title Holding Corporations or Trusts . . . 501(c)(25)      501(c)(3) (Except Private Foundation)
                                                                                                       separately for organizations with gross
                                                           and Section 501(e), 501(f), 501(k),
State-Sponsored Organizations                                                                          income of $1,000 or more from
  Providing Health Coverage for                            501(n), or Section 4947(a)(1),
                                                                                                       business unrelated to the organization’s
  High-Risk Individuals . . . . . . . . . . . 501(c)(26)   Nonexempt Charitable Trust. An
                                                                                                       exempt purpose. The Form 990-T is
                                                           organization is not required to file
State-Sponsored Workmen’s                                                                              also filed to pay the section 6033(e)(2)
  Compensation and Insurance and                           Schedule A (Form 990 or 990-EZ) if its
                                                                                                       proxy tax. For Form 990, see line 85
  Reinsurance Organizations . . . . . . . 501(c)(27)       gross receipts are normally $25,000 or
                                                                                                       and its instructions; for Form 990-EZ,
                                                           less. See the gross receipts discussion
Religious and Apostolic Associations . .          501(d)                                               see line 35 and its instructions.
                                                           in General Instruction B.
Cooperative Hospital Service                                                                           Form 990-W. Estimated Tax on
  Organizations . . . . . . . . . . . . . . . .   501(e)   Schedule B (Form 990, 990-EZ, or            Unrelated Business Taxable Income for
Cooperative Service Organizations of
                                                           990-PF). Schedule of Contributors.          Tax-Exempt Organizations.
  Operating Educational Organizations             501(f)   Schedule B (Form 990, 990-EZ, or
                                                           990-PF) provides contributor                Form 1040. U.S. Individual Income
Child Care Organizations . . . . . . . . . .      501(k)
                                                           information for line 1 of Form 990 and      Tax Return.
Charitable Risk Pools . . . . . . . . . . . .     501(n)   990-EZ. All Form 990 and 990-EZ filers      Form 1041. U.S. Income Tax Return
Political Organizations . . . . . . . . . . . .     527    must complete and attach this schedule      for Estates and Trusts. Required of
                                                           to their return unless they meet an         section 4947(a)(1) nonexempt
                                                           exception, and check the box in item M      charitable trusts that also file Form 990
                                                           of Form 990 (item H on Form 990-EZ).        or Form 990-EZ. However, if such a
D. Forms and Publications                                                                              trust does not have any taxable income
                                                           Forms W-2 and W-3. Wage and Tax             under Subtitle A of the Code, it can file
       Internet. You can access the                        Statement; and Transmittal of Wage          Form 990, or Form 990-EZ, and does
       IRS website 24 hours a day, 7                       and Tax Statements.                         not have to file Form 1041 to meet its
       days a week, at www.irs.gov to:                     Form W-9. Request for Taxpayer              section 6012 filing requirement. If this
• Download forms, instructions, and                        Identification Number and Certification.    condition is met, complete Form 990, or
publications.                                                                                          Form 990-EZ, and do not file Form
• Order IRS products online.                               Form 940. Employer’s Annual Federal
                                                                                                       1041.
• Research your tax questions online.                      Unemployment (FUTA) Tax Return.
• Search publications online by topic or                   Form 941. Employer’s QUARTERLY                  A section 4947(a)(1) nonexempt
keyword.                                                   Federal Tax Return. Used to report          charitable trust that normally has gross
• View Internal Revenue Bulletins                          social security, Medicare, and income       receipts of not more than $25,000 (see
(IRBs) published in the last few years.                    taxes withheld by an employer and           the gross receipts discussion in
• Sign up to receive local and national                    social security and Medicare taxes paid     General Instruction B) and has no
tax news by email.                                         by an employer.                             taxable income under Subtitle A must
                                                                                                       complete line 92 and the signature
         CD for tax products. You can                      Form 943. Employer’s Annual Federal         block on page 9 of the Form 990. On
         order Publication 1796, IRS Tax                   Tax Return for Agricultural Employees.      the Form 990-EZ, complete line 43 and
         Products CD, and obtain:                              Trust Fund Recovery Penalty. If         the signature block on page 3 of the
• A CD that is released twice so you                       certain excise, income, social security,    return. In addition, complete only the
have the latest products. The first                        and Medicare taxes that must be             following items in the heading of Form
release ships in late December and the                     collected or withheld are not collected     990 or Form 990-EZ:
final release ships in late February.                      or withheld, or these taxes are not paid
• Current-year forms, instructions, and                    to the IRS, a Trust Fund Recovery           Item
publications.                                                                                          A    Tax year (fiscal year or short period, if
                                                           Penalty may apply. The Trust Fund
• Prior-year forms, instructions, and                      Recovery Penalty may be imposed on          B
                                                                                                            applicable)
                                                                                                            Applicable checkboxes
publications.                                              all persons (including volunteers) who      C    Name and address
• Tax Map: an electronic research tool                     the IRS determines were responsible         D    Employer identification number (EIN)
and finding aid.                                           for collecting, accounting for, and         J    Section 4947(a)(1) nonexempt charitable
• Tax law frequently asked questions                       paying over these taxes, and who acted           trust box
(FAQs).                                                    willfully in not doing so.                  Form 1096. Annual Summary and
• Tax Topics from the IRS telephone                            This penalty does not apply to          Transmittal of U.S. Information Returns.
response system.
• Fill-in, print, and save features for                    volunteer unpaid members of any board       Form 1098 series. Information
most tax forms.                                            of trustees or directors of a tax-exempt    returns to report mortgage interest,
• Internal Revenue Bulletins.                              organization, if these members are          student loan interest, qualified tuition
• Toll-free and email technical support.                   solely serving in an honorary capacity,     and related expenses received, and a
                                                           do not participate in the day-to-day or     contribution of a qualified vehicle that
   Buy the CD from National Technical                      financial activities of the organization,   has a claimed value of more than $500.
Information Service (NTIS) at www.irs.                     and do not have actual knowledge of         Form 1099 series. Information returns
gov/cdorders for $35 (no handling fee)                     the failure to collect, account for, and    to report acquisitions or abandonments
or call 1-877-233-6767 toll free to buy                    pay over these taxes. However, the          of secured property, proceeds from
the CD for $35 (plus a $5 handling fee).                   preceding sentence does not apply if it     broker and barter exchange
By phone and in person. You can                            results in no person being liable for the   transactions, cancellation of debt,
order forms and publications by calling                    penalty.                                    dividends and distributions, certain
1-800-TAX-FORM (1-800-829-3676).                              The penalty is equal to the unpaid       government and state qualified tuition
You can also get most forms and                            trust fund tax. See Pub. 15 (Circular E),   program payments, taxable
publications at your local IRS office.                     Employer’s Tax Guide, for more details,     distributions from cooperatives, interest
General Instructions for Form 990 and Form 990-EZ                             -5-
payments, payments of long-term care             However, if the organization receives   990-EZ, or 990-PF) in place of all or
and accelerated death benefits,              a charitable cash contribution in excess    part of their own financial report forms.
miscellaneous income payments,               of $10,000, it is not subject to the        The substitution applies primarily to
distributions from an HSA, Archer MSA        reporting requirement since the funds       section 501(c)(3) organizations, but
or Medicare Advantage MSA, original          were not received in the course of a        some of the other types of section
issue discount, distributions from           trade or business.                          501(c) organizations are also affected.
pensions, annuities, retirement or           Form 8822. Change of Address. Used               If the organization uses Form 990, or
profit-sharing plans, IRAs, insurance        to notify the IRS of a change in mailing    Form 990-EZ, to satisfy state or local
contracts, etc., and proceeds from real      address that occurs after the return is     filing requirements, such as those
estate transactions. Also, use certain of    filed.                                      under state charitable solicitation acts,
these returns to report amounts that                                                     note the following discussions.
                                             Form 8868. Application for Extension
were received as a nominee on behalf
                                             of Time To File an Exempt Organization      Determine State Filing
of another person.
                                             Return.
Form 1120-POL. U.S. Income Tax                                                           Requirements
                                             Form 8870. Information Return for
Return for Certain Political                 Transfers Associated With Certain           The organization may consult the
Organizations.                               Personal Benefit Contracts. Used to         appropriate officials of all states and
Form 1128. Application To Adopt,             identify those personal benefit contracts   other jurisdictions in which it does
Change, or Retain a Tax Year.                for which funds were transferred to the     business to determine their specific
                                             organization, directly or indirectly, as    filing requirements. Doing business in a
Form 3115. Application for Change in                                                     jurisdiction may include any of the
Accounting Method.                           well as the transferors for, and
                                             beneficiaries of, those contracts.          following: (a) soliciting contributions or
Form 4506. Request for Copy of Tax                                                       grants by mail or otherwise from
Return.                                      Form 8871. Political Organization           individuals, businesses, or other
                                             Notice of Section 527 Status.               charitable organizations; (b) conducting
Form 4506-A. Request for Public
Inspection or Copy of Exempt or              Form 8872. Political Organization           programs; (c) having employees within
Political Organization IRS Form.             Report of Contributions and                 that jurisdiction; (d) maintaining a
                                             Expenditures.                               checking account; or (e) owning or
Form 4562. Depreciation and
Amortization.                                Form 8886-T. Disclosure by                  renting property there.
                                             Tax-Exempt Entity Regarding                 Monetary Tests May Differ
Form 4720. Return of Certain Excise          Prohibited Tax Shelter Transaction.
Taxes Under Chapters 41 and 42 of the                                                    Some or all of the dollar limitations
Internal Revenue Code.                       Form 8899. Notice of Income from            applicable to Form 990, or Form
                                             Donated Intellectual Property. Used to      990-EZ, when filed with the IRS may
Form 5500. Annual Return/Report of           report net income from qualified
Employee Benefit Plan. Employers who                                                     not apply when using Form 990, or
                                             intellectual property to the IRS and the    Form 990-EZ, in place of state or local
maintain pension, profit-sharing, or         donor.
other funded deferred compensation                                                       report forms. Examples of the IRS
plans are generally required to file the     Form 8921. Applicable Insurance             dollar limitations that do not meet some
Form 5500. This requirement applies          Contracts Information Return.               state requirements are the $25,000
whether or not the plan is qualified         Form TD F 90-22.1. Report of                gross receipts minimum that creates an
under the Internal Revenue Code and          Foreign Bank and Financial Accounts.        obligation to file with the IRS (see the
whether or not a deduction is claimed                                                    gross receipts discussion in General
for the current tax year.
                                             Helpful Publications                        Instruction B) and the $50,000
Form 5768. Election/Revocation of            Publication 463. Travel,                    minimum for listing professional fees in
Election by an Eligible Section              Entertainment, Gift, and Car Expenses.      Part II-A of Schedule A (Form 990 or
501(c)(3) Organization To Make               Publication 525. Taxable and                990-EZ).
Expenditures To Influence Legislation.       Nontaxable Income.                          Additional Information May Be
Form 8282. Donee Information                 Publication 526. Charitable                 Required
Return. Required of the donee of             Contributions.                              State or local filing requirements may
charitable deduction property who sells,     Publication 538. Accounting Periods         require the organization to attach to
exchanges, or otherwise disposes of          and Methods.                                Form 990, or Form 990-EZ, one or
donated property within 3 years after        Publication 598. Tax on Unrelated           more of the following: (a) additional
receiving it. The form is also required of   Business Income of Exempt                   financial statements, such as a
any successor donee who disposes of          Organizations.                              complete analysis of functional
charitable deduction property within 3                                                   expenses or a statement of changes in
years after the date that the donor gave     Publication 910. IRS Guide to Free
                                             Tax Services.                               net assets; (b) notes to financial
the property to the original donee. It                                                   statements; (c) additional financial
does not matter who gave the property        Publication 946. How To Depreciate          schedules; (d) a report on the financial
to the successor donee. It may have          Property.                                   statements by an independent
been the original donee or another           Publication 1771. Charitable                accountant; and (e) answers to
successor donee.                             Contributions — Substantiation and          additional questions and other
Form 8283. Noncash Charitable                Disclosure Requirements.                    information. Each jurisdiction may
Contributions.                                                                           require the additional material to be
Form 8300. Report of Cash Payments           E. Use of Form 990, or Form                 presented on forms they provide. The
Over $10,000 Received in a Trade or                                                      additional information does not have to
Business. Used to report cash amounts
                                             990-EZ, To Satisfy State                    be submitted with the Form 990, or
in excess of $10,000 that were received      Reporting Requirements                      Form 990-EZ, filed with the IRS.
in a single transaction (or in two or        Some states and local government               Even if the Form 990, or Form
more related transactions) in the course     units will accept a copy of Form 990, or    990-EZ, that the organization files with
of a trade or business (as defined in        Form 990-EZ, Schedule A (Form 990 or        the IRS is accepted by the IRS as
section 162).                                990-EZ), and Schedule B (Form 990,          complete, a copy of the same return
                                                                -6-         General Instructions for Form 990 and Form 990-EZ
filed with a state will not fully satisfy that   Public Inspection                            990-EZ, for which other forms can be
state’s filing requirement if required           The Form 990, or Form 990-EZ,                substituted are the same. These areas
information is not provided, including           information made available for public        are:
any of the additional information                inspection by the IRS may differ from        Form 990.
discussed above, or if the state                 that made available by the states. See       • Lines 13 through 15 of Part I (but
determines that the form was not                 the discussion of Schedule B (Form           complete lines 16 through 21);
completed by following the applicable            990, 990-EZ, or 990-PF) in General           • Part II; and
Form 990, or Form 990-EZ, instructions           Instruction L.                               • Part IV (but complete lines 59, 66,
or supplemental state instructions. If so,                                                    and 74, columns (A) and (B)).
the organization may be asked to
provide the missing information or to            F. Other Forms as Partial                    Form 990-EZ.
submit an amended return.                                                                     • Lines 10 through 16 of Part I (but
                                                 Substitutes for Form 990 or                  complete lines 17 through 21).
Use Of Audit Guides May Be                       Form 990-EZ                                  • Part II (but complete lines 25 through
Required                                         Except as provided below, the Internal       27, columns (A) and (B)).
To ensure that all organizations report          Revenue Service will not accept any             If an organization substitutes Form
similar transactions uniformly, many             form as a substitute for one or more         LM-2 or LM-3 for any of the Form 990,
states require that contributions, gifts,        parts of Form 990 or Form 990-EZ.            or Form 990-EZ, parts or line items
grants, etc., and functional expenses            Labor Organizations (Section                 mentioned above, it must attach a
be reported according to the AICPA                                                            reconciliation sheet to show the
                                                 501(c)(5))                                   relationship between the amounts on
industry audit and accounting guide,
Not-for-Profit Organizations (New York,          A labor organization that files Form         the DOL forms and the amounts on
NY, AICPA, 2003), supplemented by                LM-2, Labor Organization Annual              Form 990 or Form 990-EZ. This is
Standards of Accounting and Financial            Report, or the shorter Form LM-3,            particularly true of the relationship of
Reporting for Voluntary Health and               Labor Organization Annual Report, with       disbursements shown on the DOL
Welfare Organizations (Washington,               the U.S. Department of Labor (DOL)           forms and the total expenses on line
DC, National Health Council, Inc., 1998,         can attach a copy of the completed           17, Part I, of both Form 990 and Form
4th edition).                                    DOL form to Form 990, or Form                990-EZ. The organization must make
                                                 990-EZ, to provide some of the               this reconciliation because the cash
Donated Services and Facilities                  information required by Form 990 or          disbursements section of the DOL
                                                 Form 990-EZ. This substitution is not        forms includes nonexpense items. If the
Even though reporting donated services           permitted if the organization files a DOL
and facilities as items of revenue and                                                        organization substitutes Form LM-2, be
                                                 report that consolidates its financial       sure to complete its separate schedule
expense is called for in certain                 statements with those of one or more
circumstances by the two publications                                                         of expenses.
                                                 separate subsidiary organizations.
named above, many states and the IRS
do not permit the inclusion of those             Employee Benefit Plans                       G. Accounting Periods and
amounts in Parts I and II of Form 990            (Section 501(c)(9), (17), or (18))
or Part I of Form 990-EZ. The optional                                                        Methods
                                                 An employee benefit plan may be able
reporting of donated services and                to substitute Form 5500 for part of
facilities is discussed in the instructions                                                          For more information about
                                                 Form 990 or Form 990-EZ. The                  TIP these topics, see Pub. 538.
for Part III for both Form 990 and Form          substitution can be made if the
990-EZ.                                          organization filing Form 990, or Form
Amended Returns                                  990-EZ, and the plan filing Form 5500,       Accounting Periods
                                                 meet all the following tests:
If the organization submits                                                                   Calendar year. Use the 2007 Form
supplemental information or files an                 1. The Form 990, or Form 990-EZ,         990, or Form 990-EZ, to report on the
amended Form 990, or Form 990-EZ,                filer is organized under section             2007 calendar year accounting period.
with the IRS, it must also send a copy           501(c)(9), (17), or (18);                    A calendar year accounting period
of the information or amended return to              2. The Form 990, or Form 990-EZ,         begins on January 1 and ends on
any state with which it filed a copy of          filer and Form 5500 filer are identical      December 31.
Form 990, or Form 990-EZ, originally to          for financial reporting purposes and
                                                 have identical receipts, disbursements,      Fiscal year. If the organization has
meet that state’s filing requirement.                                                         established a fiscal year accounting
                                                 assets, liabilities, and equity accounts;
    If a state requires the organization to          3. The employee benefit plan does        period, use the 2007 Form 990, or
file an amended Form 990, or Form                not include more than one section            Form 990-EZ, to report on the
990-EZ, to correct conflicts with Form           501(c) organization, and the section         organization’s fiscal year that began in
990, or Form 990-EZ, instructions, it            501(c) organization is not a part of         2007 and ended 12 months later. A
must also file an amended return with            more than one employee benefit plan;         fiscal year accounting period normally
the IRS.                                             4. The organization’s accounting         coincides with the natural operating
                                                 year and the employee plan year are          cycle of the organization. Be certain to
Method of Accounting                             the same. If they are not, the               indicate in the heading of Form 990, or
                                                 organization may want to change its          Form 990-EZ, the date the
Most states require that all amounts be                                                       organization’s fiscal year began in 2007
reported based on the accrual method             accounting year, as explained in
                                                 General Instruction G, so it will coincide   and the date the fiscal year ended in
of accounting. See also General                                                               2008.
Instruction G.                                   with the plan year.
                                                                                              Short period. A short accounting
Time For Filing May Differ                       Allowable Substitution Areas                 period is a period of less than 12
The deadline for filing Form 990, or             Whether an organization files Form           months.
Form 990-EZ, with the IRS differs from           990, or Form 990-EZ, for a labor                 If the Form 990, or Form 990-EZ, for
the time for filing reports with some            organization or for an employee benefit      the short year is not available until the
states.                                          plan, the areas of Form 990, or Form         subsequent year, use the prior year
General Instructions for Form 990 and Form 990-EZ                   -7-
Form 990, or Form 990-EZ, to meet the       State reporting. If the organization         • DHL Express (DHL): DHL “Same
organization’s filing requirement. Cross    prepares Form 990, or Form 990-EZ,           Day” Service, DHL Next Day 10:30 AM,
out the year on the form and show the       for state reporting purposes, it may file    DHL Next Day 12:00 PM, DHL Next
short year.                                 an identical return with the IRS even        Day 3:00 PM, and DHL 2nd Day
    Accounting period change. If the        though the return does not agree with        Service.
organization changes its accounting         the books of account, unless the way         • Federal Express (FedEx): FedEx
period, it must file a return on Form       one or more items are reported on the        Priority Overnight, FedEx Standard
990, or Form 990-EZ, for the short          state return conflicts with the              Overnight, FedEx 2Day, FedEx
period resulting from the change. Write     instructions for preparing Form 990, or      International Priority, FedEx
“Change of Accounting Period” at the        Form 990-EZ, for filing with the IRS.        International First.
top of this short-period return.               Example 1. The organization               • United Parcel Service (UPS): UPS
                                            maintains its books on the cash              Next Day Air, UPS Next Day Air Saver,
    If the organization changed its                                                      UPS 2nd Day Air, UPS 2nd Day Air
accounting period within the                receipts and disbursements method of
                                            accounting but prepares a state return       A.M., UPS Worldwide Express Plus,
10-calendar-year period that includes                                                    and UPS Worldwide Express.
the beginning of the short period, and it   based on the accrual method. It could
had a Form 990, or Form 990-EZ, filing      use that return for reporting to the IRS.       The private delivery service can tell
requirement at any time during that            Example 2. A state reporting              you how to get written proof of the
10-year period, it must also attach a       requirement requires the organization        mailing date.
Form 1128 to the short-period return.       to report certain revenue, expense, or       Electronic Filing
See Rev. Proc. 85-58, 1985-2 C.B.           balance sheet items differently from the
                                            way it normally accounts for them on its     The organization can file Form 990, or
740.                                                                                     Form 990-EZ, and related forms,
Group return. When affiliated               books. A Form 990, or Form 990-EZ,
                                            prepared for that state is acceptable for    schedules, and attachments
organizations authorize their central                                                    electronically. However, if an
organization to file a group return for     the IRS reporting purposes if the state
                                            reporting requirement does not conflict      organization files at least 250 returns
them, the accounting period of the                                                       during the calendar year and has total
affiliated organizations and the central    with the Form 990, or Form 990-EZ,
                                            instructions.                                assets of $10 million or more at the end
organization must be the same. See                                                       of the tax year, it must file Form 990
General Instruction R.                         An organization should keep a             electronically.
                                            reconciliation of any differences
Accounting Methods                          between its books of account and the             To determine if the organization
Unless instructed otherwise, the            Form 990, or Form 990-EZ, that is filed.     meets the $10 million asset test, use
organization should generally use the                                                    the amount that will be entered on line
                                               Most states that accept Form 990, or      59 (total assets), column (B).
same accounting method on the return        Form 990-EZ, in place of their own
to figure revenue and expenses as it        forms require that all amounts be                If an organization is required to file a
regularly uses to keep its books and        reported based on the accrual method         return electronically but does not, the
records. To be acceptable for Form          of accounting. For further information,      organization is considered to have not
990, or Form 990-EZ, reporting              see General Instruction E.                   filed its return. See Temporary
purposes, however, the method of                                                         Regulations section 301.6033-4T for
accounting used must clearly reflect                                                     more information.
income.                                     H. When, Where, and How To                       For additional information on the
    Generally, the organization must file   File                                         electronic filing requirement, visit www.
Form 3115 to change its accounting          File Form 990, or Form 990-EZ, by the        irs.gov/efile.
method. Notice 96-30, 1996-1 C.B. 378,      15th day of the 5th month after the                  The IRS may waive the
provides relief from filing Form 3115 to    organization’s accounting period ends.        TIP requirements to file
section 501(c) organizations that           If the regular due date falls on a                    electronically in cases of undue
change their method of accounting to        Saturday, Sunday, or legal holiday, file     hardship. For information on filing a
comply with the provisions of SFAS          on the next business day. A business         waiver, see Notice 2005-88, which is on
116, Accounting for Contributions           day is any day that is not a Saturday,       page 1060 of the Internal Revenue
Received and Contributions Made. In         Sunday, or legal holiday.                    Bulletin 2005-48 at www.irs.gov/pub/
SFAS 116, the Financial Accounting              If the organization is liquidated,       irs-irbs/irb05-48.pdf.
Standards Board revised certain             dissolved, or terminated, file the return
generally accepted accounting               by the 15th day of the 5th month after
principles relating to contributions        the liquidation, dissolution, or             I. Extension of Time To File
received and contributions awarded by       termination.                                 Use Form 8868 to request an automatic
not-for-profit organizations.                                                            3-month extension of time to file. Use
                                                If the return is not filed by the due
     A not-for-profit organization that     date (including any extension granted),      Form 8868 also to apply for an
changes its method of accounting for        attach a statement giving the reasons        additional (not automatic) 3-month
federal income tax purposes to conform      for not filing on time. Send the return to   extension if the original 3 months was
to the method provided in SFAS 116          the:                                         not enough time. To obtain this
must report any adjustment required by                                                   additional extension of time to file, the
section 481(a) on line 20 of Form 990,             Department of the Treasury            organization must show reasonable
or Form 990-EZ, as a net asset                     Internal Revenue Service Center       cause for the additional time requested.
adjustment made during the year the                Ogden, UT 84201-0027                  See the Instructions for Form 8868.
change is made. The adjustment must         Private delivery services. The
be identified as the effect of changing     organization can use certain private         J. Amended Return/Final
to the method provided in SFAS 116.         delivery services designated by the IRS
The beginning of year statement of          to meet the “timely mailing as timely        Return
financial position (balance sheet)          filing/paying” rule for tax returns and      To change the organization’s return for
should not be restated to reflect any       payments. These private delivery             any year, file a new return including any
prior period adjustments.                   services include only the following.         required attachments. Use the revision
                                                               -8-          General Instructions for Form 990 and Form 990-EZ
of Form 990, or Form 990-EZ,                  return contains incorrect information.       organization that is not eligible to
applicable to the year being amended.         For example, an organization that            receive contributions deductible as
The amended return must provide all           reports contributions net of related         charitable contributions for federal
the information called for by the form        fundraising expenses may be subject to       income tax purposes must include an
and instructions, not just the new or         this penalty.                                explicit statement that contributions or
corrected information. Check the                                                           gifts to it are not deductible as
Amended return box in the heading of          Against Responsible Person(s)                charitable contributions. The statement
the return.                                   If the organization does not file a          must be in an easily recognizable
                                              complete return or does not furnish          format whether the solicitation is made
   The organization may file an               correct information, the IRS will send
amended return at any time to change                                                       in written or printed form, by television
                                              the organization a letter that includes a    or radio, or by telephone. This provision
or add to the information reported on a       fixed time to fulfill these requirements.
previously filed return for the same                                                       applies only to those organizations
                                              After that period expires, the person        whose annual gross receipts are
period. It must make the amended              failing to comply will be charged a
return available for public inspection for                                                 normally more than $100,000 (section
                                              penalty of $10 a day. The maximum            6113 and Notice 88-120, 1988-2 C.B.
3 years from the date of filing or 3 years    penalty on all persons for failures with
from the date the original return was                                                      454).
                                              respect to any one return shall not
due, whichever is later.                      exceed $5,000 (section                           Failure to disclose that contributions
   The organization must also send a          6652(c)(1)(B)(ii)).                          are not deductible could result in a
copy of the information or amended                Any person who does not comply           penalty of $1,000 for each day on
return to any state with which it filed a     with the public inspection requirements,     which a failure occurs. The maximum
copy of Form 990, or Form 990-EZ,             as discussed in General Instruction M,       penalty for failures by any organization,
originally to meet that state’s filing        will be assessed a penalty of $20 for        during any calendar year, shall not
requirement.                                  each day that inspection was not             exceed $10,000. In cases where the
   Use Form 4506 to obtain a copy of a        permitted, up to a maximum of $10,000        failure to make the disclosure is due to
previously filed return. For information      for each return. The penalties for failure   intentional disregard of the law, more
on getting blank tax forms, see General       to comply with the public inspection         severe penalties apply. No penalty will
Instruction D.                                requirements for applications is the         be imposed if the failure is due to
                                              same as those for annual returns,            reasonable cause (section 6710).
   If the return is a final return, see the
Specific Instructions for Form 990 for        except that the $10,000 limitation does      Keeping Fundraising Records
line 79, Part VI. For Form 990-EZ, see        not apply (sections 6652(c)(1)(C) and
                                              (D)). Any person who willfully fails to      for Tax-Deductible
the Specific Instructions for line 36, Part                                                Contributions
V.                                            comply with the public inspection
                                              requirements for annual returns or           Section 501(c) organizations that are
                                              exemption applications will be subject       eligible to receive tax-deductible
K. Failure to File Penalties                  to an additional penalty of $5,000           contributions under section 170(c) of
                                              (section 6685).                              the Code must keep sample copies of
Against the Organization                          There are also penalties (fines and      their fundraising materials, such as:
Under section 6652(c)(1)(A), a penalty        imprisonment) for willfully not filing       • Dues statements,
of $20 a day, not to exceed the smaller       returns and for filing fraudulent returns    • Fundraising solicitations,
of $10,000 or 5% of the gross receipts        and statements with the IRS (sections        • Tickets,
of the organization for the year, may be      7203, 7206, and 7207). States may            • Receipts, or
charged when a return is filed late,          impose additional penalties for failure to   • Other evidence of payments received
unless the organization can show that         meet their separate filing requirements.     in connection with fundraising activities.
the late filing was due to reasonable         See also the discussion of the Trust
cause. Organizations with annual gross        Fund Recovery Penalty, under General         IF . . .                 THEN . . .
receipts exceeding $1 million are             Instruction D.
                                                                                           Organizations advertise They must keep
subject to a penalty of $100 for each                                                      their fundraising events, samples of the
day the failure continues (with a
maximum penalty with respect to any           L. Contributions                                                       advertising copy.

one return of $50,000). The penalty                                                        Organizations use radio They must keep
begins on the due date for filing the         Schedule B (Form 990, 990-EZ,                or television to make   samples of:
Form 990 or Form 990-EZ.                      or 990-PF)                                   their solicitations,    • Scripts,
    Use of a paid preparer does not           Schedule B (Form 990, 990-EZ, or                                     • Transcripts, or
relieve the organization of its               990-PF), generally, is a required                                    • Other evidence of
responsibility to file a complete and         attachment for the Form 990, 990-EZ,                                 on-air solicitations.
accurate return.                              or 990-PF, and is used to report on
                                              tax-deductible and non-tax-deductible        Organizations use        They must keep
Incomplete return. The penalty may            contributions. See the Instructions for      outside fundraisers,     samples of the
also be charged if the organization files     Schedule B for the public inspection                                  fundraising materials
an incomplete return. To avoid having                                                                               used by the outside
                                              rules applicable to that form. See also                               fundraisers.
to supply missing information later, be       the Specific Instructions for both Form
sure to complete all applicable line          990 and Form 990-EZ, under
items; answer “Yes,” “No,” or “N/A” (not      Completing the Heading . . . where the          For each fundraising event,
applicable) to each question on the           instructions are keyed to items in the       organizations must keep records to
return; make an entry (including a zero       heading of Form 990 or Form 990-EZ.          show the portion of any payment
when appropriate) on all total lines; and                                                  received from patrons that is not
enter “None” or “N/A” if an entire part       Solicitations of Nondeductible               deductible; that is, the retail value of the
does not apply.                               Contributions                                goods or services received by the
Incorrect information. This penalty           Any fundraising solicitation by or on        patrons. See Disclosure statement for
may be imposed if the organization’s          behalf of any section 501(c) or 527          quid pro quo contributions, later.
General Instructions for Form 990 and Form 990-EZ                -9-
Noncash Contributions                           The organization’s acknowledgment           Certain goods or services
See the Instructions for Schedule B         must:                                           disregarded for substantiation and
(Form 990, 990-EZ, or 990-PF).                  1. Be written.                              disclosure purposes.
                                                2. Be contemporaneous.                          Goods or services with
   If the organization received a                                                           insubstantial value. Generally, under
partially completed Form 8283 from a            3. State the amount of any cash it
                                            received.                                       section 170, the deductible amount of a
donor, complete it and return it so the                                                     contribution is determined by taking into
donor can get a charitable contribution         4. State:                                   account the fair market value, not the
deduction. The organization should              a. Whether the organization gave            cost to the charity, of any benefits
keep a copy for its records. See also       the donor any intangible religious              received in return. However, the cost to
the reference to Form 8282 in General       benefits (no valuation needed).                 the charity may be used in determining
Instruction D.                                  b. Whether or not the organization          whether the benefits are insubstantial.
   Qualified intellectual property. An      gave the donor any goods or services            See below.
organization described in section 170(c)    in return for the donor’s contribution (a           Cost basis. If a taxpayer makes a
(except a private foundation) that          quid pro quo contribution).                     payment of $44.50 or more to a charity
receives or accrues net income from a           5. Describe goods or services the           and receives only token items in return,
qualified intellectual property             organization:                                   the items have insubstantial value if
contribution must file Form 8899. The           a. Received (no valuation needed).          they:
organization must file the return for any
                                                b. Gave (good faith estimate                • Bear the charity’s name or logo, and
tax year that includes any part of the
                                            needed).                                        • Have an aggregate cost to the charity
10-year period beginning on the date of                                                     of $8.90 or less (low-cost article amount
contribution but not for any tax years in                                                   of section 513(h)(2)).
which the legal life of the qualified          Exception. An organization need
                                            not make a good faith estimate of a                 Fair market value basis. If a
intellectual property has expired or the                                                    taxpayer makes a payment to a
property failed to produce net income.      quid pro quo contribution if the goods or
                                            services given to a donor are:                  charitable organization in a fundraising
    An organization (donee) reports all     • Insubstantial in value.                       campaign and receives benefits with a
income from donated qualified                                                               fair market value of not more than 2%
intellectual property as income other
                                            • Certain membership benefits for $75           of the amount of the payment, or $89,
                                            or less per year. See Certain                   whichever is less, the benefits received
than contributions (for example, royalty    membership benefits, later.
income from a patent). Charities are not                                                    have insubstantial value in determining
required to report as contributions any     • Certain goods or services given to            the taxpayer’s contribution.
of the additional deductions claimed by     the donor’s employees or partners.
                                                                                                   The dollar amounts given above
donors under section 170(m)(1).             Disclosure statement for quid pro                TIP are applicable to tax year 2007
Likewise, these additional deductions       quo contributions. If the organization                   under Rev. Proc. 2006-53 (and
are not required to be reported on          receives a quid pro quo contribution of         other successor documents). They are
Schedule B (Form 990, 990-EZ, or            more than $75, an organization must             adjusted annually for inflation.
990-PF) and donees are not required to      provide a disclosure statement to the
comply with the substantiation                                                                 When a donee organization provides
                                            donor. The organization’s disclosure            a donor only with goods or services
requirements of section 170(f)(8) with      statement must:
regard to any donor’s additional                                                            having insubstantial value under Rev.
deductions. See Pub. 526.                       1. Be written.                              Proc. 2006-53 (and any successor
                                                2. Estimate in good faith the               documents), the contemporaneous
   Motor vehicles, boats, and               organization’s goods or services given          written acknowledgment may indicate
airplanes. Special rules apply to           in return for donor’s contribution.             that no goods or services were
charitable contributions of motor                                                           provided in exchange for the donor’s
                                                3. Describe, but need not value,
vehicles, boats, or airplanes with a                                                        payment.
                                            certain goods or services given donor’s
claimed value of more than $500. See                                                           Certain membership benefits.
                                            employees or partners.
section 170(f)(12) and the Instructions                                                     Other goods or services that are
for Form 1098-C.                                4. Inform the donor that a deductible
                                            charitable contribution deduction is            disregarded for substantiation and
Substantiation and Disclosure               limited as follows:                             disclosure purposes are annual
                                                                                            membership benefits offered to a
Requirements for Charitable                                                                 taxpayer in exchange for a payment of
Contributions                                            Donor’s contribution               $75 or less per year that consist of:
                                                                Less
Recordkeeping for cash, check, or                                                              1. Any rights or privileges that the
other monetary charitable gifts. A          Organization’s money, and goods or services     taxpayer can exercise frequently during
                                                           given in return
donor(s) must maintain a record on any                                                      the membership period such as:
contribution of cash, check, or other                          Equals                          a. Free or discounted admission to
monetary gift. This record must be a          Donor’s deductible charitable contribution.   the organization’s facilities or events,
bank record or a written communication                                                         b. Free or discounted parking.
from the donee showing the donee                                                               2. Admission to events that are:
organization’s name, date, and amount       Exception. No disclosure statement is              a. Open only to members, and are,
of the contribution.                        required if the organization gave the           per person,
Acknowledgment to substantiate              following.                                         b. Within the low-cost article
charitable contributions. An                    1. Goods or services of insubstantial       limitation.
organization (donee) should be aware        value.
that a donor of a charitable contribution                                                      Examples.
                                                2. Certain membership benefits.
of $250 or more cannot take an income                                                           1. E offers a basic membership
                                                3. An intangible religious benefit.
tax deduction unless the donor obtains                                                      benefits package for $75. The package
the organization’s acknowledgment to        See Regulations sections 1.170A-1,              gives members the right to buy tickets
substantiate the charitable contribution.   1.170A-13, and 1.6115-1.                        in advance, free parking, and a gift
                                                                -10-            General Instructions for Form 990 and Form 990-EZ
shop discount of 10%. E’s $150              • To obtain an organization’s written        consideration for the matching
preferred membership benefits package       acknowledgment substantiating the            payment.
also includes a $20 poster. Both the        donation.                                        Disclosure statement. An
basic and preferred membership                 There is no prescribed format for the     organization must provide a written
packages are for a 12-month period          organization’s written acknowledgment        disclosure statement to donors who
and include about 50 productions. E         of a donation. Letters, postcards, or        make a payment, described as a quid
offers F, a patron of the arts, the         computer-generated forms may be              pro quo contribution, in excess of $75
preferred membership benefits in return     acceptable. The acknowledgment must,         (section 6115). This requirement is
for a payment of $150 or more. F            however, provide sufficient information      separate from the written substantiation
accepts the preferred membership            to substantiate the amount of the            acknowledgment a donor needs for
benefits package for $300. E’s written      deductible contribution.                     deductibility purposes. While, in certain
acknowledgment satisfies the                                                             circumstances, an organization may be
substantiation requirement if it               The organization may either:
describes the poster, gives a good faith    • Provide separate statements for each       able to meet both requirements with the
                                            contribution of $250 or more, or             same written document, an
estimate of its fair market value ($20),
and disregards the remaining                • Furnish periodic statements                organization must be careful to satisfy
                                            substantiating contributions of $250 or      the section 6115 written disclosure
membership benefits.                                                                     statement requirement in a timely
    2. If F received only the basic         more.
                                                                                         manner because of the penalties
membership package for its $300                Separate contributions of less than       involved.
payment, E’s acknowledgment need            $250 are not subject to the
                                            requirements of section 170(f)(8),               Quid pro quo contribution. A
state only that no goods or services
                                            regardless of whether the sum of the         quid pro quo contribution is a payment
were provided.
                                            contributions made by a taxpayer to a        that is given both as a contribution and
    3. G Theater Group performs four
                                            donee organization during a tax year         as a payment for goods or services
plays. Each play is performed twice.
                                            equals $250 or more.                         provided by the donee organization.
Nonmembers can purchase a ticket for
$15. For a $60 membership fee,                 Contemporaneous. A written                    Example. A donor gives a charity
however, members are offered free           acknowledgment is contemporaneous if         $100 in consideration for a concert
admission to any of the performances.       the donor obtains it on or before the        ticket valued at $40 (a quid pro quo
H makes a payment of $350 and               earlier of:                                  contribution). In this example, $60
accepts this membership benefit.            • The date the donor files the original      would be deductible. Because the
Because of the limited number of            return for the tax year in which the         donor’s payment exceeds $75, the
performances, the membership                contribution was made, or                    organization must furnish a disclosure
privilege cannot be exercised               • The due date (including extensions)        statement even though the taxpayer’s
frequently. Therefore, G’s                  for filing the donor’s original return for   deductible amount does not exceed
acknowledgment must describe the free       that year.                                   $75. Separate payments of $75 or less
admission benefit and estimate its                                                       made at different times of the year for
                                               Substantiation of payroll                 separate fundraising events will not be
value in good faith.                        contributions. An organization may           aggregated for purposes of the $75
    Certain goods or services               substantiate a payroll contribution by:      threshold.
provided to donor’s employees or            • A pay stub, Form W-2, or other                 Good faith estimate. An
partners. Certain goods or services         document showing a contribution to a
                                            donee organization; and                      organization may use any reasonable
provided to employees or partners of                                                     method in making a good faith estimate
donors may be disregarded for               • A pledge card or other document            of the value of goods or services
substantiation and disclosure purposes.     from the donee organization stating that
                                            organization provides no goods or            provided by an organization in
Describe such goods or services. A                                                       consideration for a taxpayer’s payment
good faith estimate is not needed.          services for any payroll contributions.
                                                                                         to that organization. A good faith
    Example. Museum J offers a basic           The amount withheld from each             estimate of the value of goods or
membership benefits package for $40.        payment of wages to a taxpayer is            services that are not generally available
It includes free admission and a 10%        treated as a separate contribution.          in a commercial transaction may be
gift shop discount. Corporation K              Substantiation of payments to a           determined by reference to the fair
makes a $50,000 payment to J and in         college or university for the right to       market value of similar or comparable
return, J offers K’s employees free         purchase tickets to athletic events.         goods or services. Goods or services
admission, a tee shirt with J’s logo that   The right to purchase tickets for an         may be similar or comparable even
costs J $4.50, and a 25% gift shop          athletic event is valued at 20% of the       though they do not have the unique
discount. Because the free admission is     payment.                                     qualities of the goods or services that
offered in both benefit packages and           Example. When a taxpayer pays             are being valued.
the value of the tee shirts is              $312.50 for the right to purchase tickets        Goods or services. Goods or
insubstantial, K’s written                  for an athletic event, the right is valued   services are:
acknowledgment need not value the           at $62.50. The remaining $250 is a           • Cash,
free admission benefit or the tee shirts.   charitable contribution that the taxpayer    • Property,
However, because the 25% gift shop          must substantiate.                           • Services,
discount to K’s employees differs from         Substantiation of matched                 • Benefits, and
the 10% discount offered in the basic       payments. If a taxpayer’s payment to         • Privileges.
membership benefits package, K’s            a donee organization is matched by               In consideration for. A donee
written acknowledgment must describe        another payor, and the taxpayer              organization provides goods or services
the 25% discount, but need not              receives goods or services in                in consideration for a taxpayer’s
estimate its value.                         consideration for its payment and some       payment if, at the time the taxpayer
Definitions.                                or all of the matching payment, those        makes the payment to the donee
    Substantiation. It is the               goods or services will be treated as         organization, the taxpayer receives, or
responsibility of the donor:                provided in consideration for the            expects to receive, goods or services in
• To value a donation, and                  taxpayer’s payment and not in                exchange for that payment.
General Instructions for Form 990 and Form 990-EZ             -11-
    Goods or services a donee              Through the IRS                                      Note that a section 527 political
organization provides in consideration     Use Form 4506-A to request:                    TIP organization (and an
for a payment by a taxpayer include                                                               organization filing Form 990-PF)
goods or services provided in a year       • A copy of an exempt or political            must disclose their Schedule B (Form
other than the year in which the donor     organization’s return, report, notice, or     990, 990-EZ, or 990-PF). See the
makes the payment to the donee             exemption application;                        Instructions for Schedule B.
organization.                              • An inspection of a return, report,               The penalties discussed in General
    Intangible religious benefits.         notice, or exemption application at an        Instruction K also apply to section 527
Intangible religious benefits must be      IRS office.                                   political organizations (Rev. Rul.
provided by organizations organized             The IRS can provide copies of            2003-49, 2003-204 I.R.B. 903).
exclusively for religious purposes.        exempt organization returns on a              Public inspection and distribution of
Examples include:                          compact disc (CD). Requesters can             applications for tax exemption and
• Admission to a religious ceremony,       order the complete set (all Forms 990         annual information returns of
and                                        and 990-EZ or all Forms 990-PF filed          tax-exempt organizations. Under
• De minimis tangible benefits, such as    for a year) or a partial set by state or by   Regulations sections 301.6104(d)-1
wine, provided in connection with a        month. For more information on the            through 301.6104(d)-3, a tax-exempt
religious ceremony.                        cost and how to order CDs, call the           organization must:
    Distributing organization as           TEGE Customer Account Services                • Make its application for recognition of
donee. An organization described in        toll-free number (1-877-829-5500) or          exemption and its annual information
section 170(c), or an organization         write to the IRS in Cincinnati, OH, at        returns available for public inspection
described as a Principal Combined          the address in General Instruction A.         without charge at its principal, regional,
Fund Organization for purposes of the                                                    and district offices during regular
Combined Federal Campaign, that               The IRS may not disclose portions of
                                                                                         business hours.
                                           an exemption application relating to any
receives a payment made as a
                                           trade secrets, etc. Additionally, the IRS
                                                                                         • Make each annual information return
contribution is treated as a donee                                                       available for a period of 3 years
organization even if the organization      may not disclose the names and
                                                                                         beginning on the date the return is
distributes the amount received to one     addresses of contributors. See the
                                                                                         required to be filed (determined with
or more organizations described in         Instructions for Schedule B (Form 990,
                                                                                         regard to any extension of time for
section 170(c).                            990-EZ, or 990-PF) for more
                                                                                         filing) or is actually filed, whichever is
    Penalties. A charity that knowingly    information about the disclosure of that
                                                                                         later.
                                           schedule.
provides a false substantiation                                                          • Provide a copy without charge, (for
acknowledgment to a donor may be              Forms 990 or 990-EZ can only be            Form 990-T, this requirement only
subject to the penalties under section     requested for section 527 organizations       applies to Form 990-T’s filed after
6701 for aiding and abetting an            for tax years beginning after June 30,        August 17, 2006) other than a
understatement of tax liability.           2000.                                         reasonable fee for reproduction and
    Charities that fail to provide the                                                   actual postage costs, of all or any part
                                               A return, report, notice, or exemption    of any application or return required to
required disclosure statement for a quid
                                           application may be inspected at an IRS        be made available for public inspection
pro quo contribution of more than $75
                                           office free of charge. Copies of these        to any individual who makes a request
will incur a penalty of $10 per
                                           items may also be obtained through the        for such copy in person or in writing
contribution, not to exceed $5,000 per
                                           organization as discussed in the              (except as provided in Regulations
fundraising event or mailing. The
                                           following section.                            sections 301.6104(d)-2 and -3).
charity may avoid the penalty if it can
show that the failure was due to           Through the Organization                      Definitions.
reasonable cause (section 6714).                                                              Tax-exempt organization is any
                                           Public inspection and distribution of
                                           certain returns of unrelated business         organization that is described in section
M. Public Inspection of                    income. Section 501(c)(3)                     501(c) or (d) and is exempt from
                                                                                         taxation under section 501(a). The term
Returns, etc.                              organizations that are required to file
                                                                                         tax-exempt organization also includes
Some members of the public rely on         Form 990-T after August 17, 2006,
                                           must make Form 990-T available for            any section 4947(a)(1) nonexempt
Form 990, or Form 990-EZ, as the                                                         charitable trust or nonexempt private
primary or sole source of information      public inspection under section
                                           6104(d)(1)(A)(ii).                            foundation that is subject to the
about a particular organization. How the                                                 reporting requirements of section 6033.
public perceives an organization in        Public inspection and distribution of
such cases may be determined by the                                                           Application for tax exemption
                                           returns and reports for a political           includes:
information presented on its returns.      organization. Section 527 political           • Any prescribed application form
   An organization’s completed Form        organizations required to file Form 990,      (such as Form 1023 or Form 1024),
990, or Form 990-EZ, is available for      or Form 990-EZ, must, in general,             • All documents and statements the
public inspection as required by section   make their Form 8871, 8872, 990, or           IRS requires an applicant to file with the
6104. Schedule B (Form 990, 990-EZ,        990-EZ available for public inspection in     form,
or 990-PF) is open for public inspection   the same manner as annual information         • Any statement or other supporting
for section 527 organizations filing       returns of section 501(c) organizations       document submitted in support of the
Form 990 or Form 990-EZ. For other         and 4947(a)(1) nonexempt charitable           application, and
organizations that file Form 990 or        trusts are made available. See the            • Any letter or other document issued
Form 990-EZ, parts of Schedule B may       public inspection rules for Tax-exempt        by the IRS concerning the application.
be open to public inspection. Form         organization, later. Generally, Form
990-T filed after August 17, 2006, by a    8871 and Form 8872 are available for               Application for tax exemption
501(c)(3) organization to report any       inspection and printing from the              does not include:
unrelated business income, is also         Internet. The website address for both        • Any application for tax exemption
available for public inspection and        of these forms is /www.irs.gov/charities/     filed before July 15, 1987, unless the
disclosure.                                political/article/0,,id=109332,00.html.       organization filing the application had a
                                                              -12-          General Instructions for Form 990 and Form 990-EZ
copy of the application on July 15,            managing the exempt function activities      day following the day that the unusual
1987;                                          at the site.                                 circumstances cease to exist, or the 5th
• In the case of a tax-exempt                                                               business day after the date of the
organization other than a private                                                           request, whichever occurs first.
                                               Special rules relating to public
foundation, the name and address of
                                               inspection.                                     Unusual circumstances include:
any contributor to the organization; or
• Any material that is not available for           Permissible conditions on public         • Requests received that exceed the
public inspection under section 6104.          inspection. A tax-exempt                     organization’s daily capacity to make
                                               organization:                                copies;
         If there is no prescribed             • May have an employee present in            • Requests received shortly before the
  !      application form, see                 the room during an inspection.               end of regular business hours that
 CAUTION Regulations section
                                               • Must allow the individual conducting       require an extensive amount of
301.6104(d)-1(b)(4)(i).                        the inspection to take notes freely          copying; or
    Annual information return                  during the inspection.
includes:                                      • Must allow the individual to               • Requests received on a day when
• An exact copy of the Form 990, or            photocopy the document at no charge,         the organization’s managerial staff
Form 990-EZ, filed by a tax-exempt             if the individual provides photocopying      capable of fulfilling the request is
organization as required by section            equipment at the place of inspection.        conducting special duties, such as
6033.                                                                                       student registration or attending an
                                                  Organizations that do not
• Any amended return the organization          maintain permanent offices. A
                                                                                            off-site meeting or convention, rather
files with the IRS after the date the                                                       than its regular administrative duties.
                                               tax-exempt organization with no
original return is filed.                      permanent office:                               Agents for providing copies. For
• An exact copy of Form 990-T if one is        • Must make its application for tax          rules relating to use of agents to
filed by a 501(c)(3) organization.             exemption and its annual information         provide copies, see Regulations
    The copy must include all                  returns available for inspection at a        sections 301.6104(d)-1(d)(1) and (2).
information furnished to the IRS on            reasonable location of its choice.
Form 990, Form 990-EZ, or Form 990-T           • Must permit public inspection within a        Request for copies in writing. A
as well as all schedules, attachments,         reasonable amount of time after              tax-exempt organization must honor a
and supporting documents, except for           receiving a request for inspection           written request for a copy of documents
the name and address of any                    (normally not more than 2 weeks) and         (or the requested part) required under
contributor to the organization. See the       at a reasonable time of day.                 section 6104(d) if the request:
Instructions for Schedule B (Form 990,         • May mail, within 2 weeks of receiving         1. Is addressed to, and delivered by
990-EZ, or 990-PF).                            the request, a copy of its application for   mail, electronic mail, facsimile, or a
    Annual returns more than 3 years           tax exemption and annual information         private delivery service, as defined in
old. An annual information return does         returns to the requester instead of          section 7502(f), to a principal, regional,
not include any return after the               allowing an inspection.                      or district office of the organization; and
expiration of 3 years from the date the        • May charge the requester for copying          2. Sets forth the address to which
return is required to be filed (including      and actual postage costs only if the
                                               requester consents to the charge.            the copy of the documents should be
any extension of time that has been                                                         sent.
granted for filing such return) or is              An organization that has a
actually filed, whichever is later.            permanent office, but has no office
                                               hours, or very limited hours during          Time and manner of fulfilling written
    If an organization files an amended                                                                requests.
return, however, the amended return            certain times of the year, must make its
must be made available for a period of         documents available during those             IF the organization . . THEN the organization
3 years beginning on the date it is filed      periods when office hours are limited,
with the IRS.                                  or not available, as though it were an       Receives a written      Must mail the copy of
                                               organization without a permanent             request for a copy,     the requested
    Local or subordinate                       office.                                                              documents (or the
organizations. For rules relating to                                                                                requested parts) within
annual information returns of local or         Special rules relating to copies.                                    30 days from the date it
subordinate organizations, see                     Time and place for providing                                     receives the request.
Regulations section                            copies in response to requests made
301.6104(d)-1(f)(2).                                                                        Mails the copy of the   Is deemed to have
                                               in-person. A tax-exempt organization         requested document,     provided the copy on the
    Regional or district offices. A            must:                                                                postmark date or private
regional or district office is any office of   • Provide copies of required                                         delivery mark (if sent by
a tax-exempt organization, other than          documents under section 6104(d) in                                   certified or registered
its principal office, that has paid            response to a request made in person                                 mail, the date of
                                                                                                                    registration or the date
employees, whether part-time or                at its principal, regional, and district                             of the postmark on the
full-time, whose aggregate number of           offices during regular business hours.                               sender’s receipt).
paid hours a week are normally at least        • Provide such copies to a requester
120.                                           on the day the request is made, except       Requires payment in     Is required to provide
    A site is not considered a regional or     for unusual circumstances (see below).       advance,                the copies within 30
                                                                                                                    days from the date it
district office, however, if:                      Unusual circumstances. In the                                    receives payment.
• The only services provided at the site       case of an in-person request, where
further exempt purposes (such as day           unusual circumstances exist so that          Receives a request or   Is deemed to have
care, health care, scientific research, or     fulfilling the request on the same           payment by mail,        received it 7 days after
medical research); and                         business day causes an unreasonable                                  the date of the
• The site does not serve as an office         burden to the tax-exempt organization,                               postmark, absent
                                                                                                                    evidence to the contrary.
for management staff, other than               the organization must provide the
managers who are involved solely in            copies no later than the next business
General Instructions for Form 990 and Form 990-EZ                -13-
Receives a request        Is deemed to have                Documents to be provided by             each local or subordinate organization
transmitted by electronic received it the day the     regional and district offices. Except        included in the group return, the local or
mail or facsimile,        request is transmitted      as otherwise provided, a regional or         subordinate organization receiving the
                          successfully.               district office of a tax-exempt              request may omit any schedules
                                                      organization must satisfy the same           relating only to other organizations
Receives a written        Must notify the             rules as the principal office with respect   included in the group return.
request without payment   requester of the
or with an insufficient   prepayment policy and
                                                      to allowing public inspection and                The local or subordinate
payment, when payment     the amount due within 7     providing copies of its application for      organization must permit public
in advance is required,   days from the date of       tax exemption and annual information         inspection, or comply with a request for
                          the request’s receipt.      returns.                                     copies made in person, within a
                                                           A regional or district office is not    reasonable amount of time (normally
Receives consent from     May provide a copy of
an individual making a    the requested document
                                                      required, however, to make its annual        not more than 2 weeks) after receiving
request,                  exclusively by electronic   information return available for             a request made in person for public
                          mail (the material is       inspection or to provide copies until 30     inspection or copies and at a
                          provided on the date the    days after the date the return is            reasonable time of day.
                          organization                required to be filed (including any
                          successfully transmits                                                       In a case where the requester seeks
                                                      extension of time that is granted for        inspection, the local or subordinate
                          the electronic mail).
                                                      filing such return) or is actually filed,    organization may mail a copy of the
                                                      whichever is later.                          applicable documents to the requester
   Request for a copy of parts of a                        Documents to be provided by             within the same time period instead of
document. A tax-exempt organization                   local and subordinate organizations.         allowing an inspection. In such a case,
must fulfill a request for a copy of the                                                           the organization may charge the
organization’s entire application for tax             Applications for tax exemption.              requester for copying and actual
exemption or annual information return                Except as otherwise provided, a              postage costs only if the requester
or any specific part or schedule of its               tax-exempt organization that did not file    consents to the charge.
application or return. A request for a                its own application for tax exemption
copy of less than the entire application                                                               If the local or subordinate
                                                      (because it is a local or subordinate        organization receives a written request
or less than the entire return must                   organization covered by a group
specifically identify the requested part                                                           for a copy of its annual information
                                                      exemption letter) must, upon request,        return, it must fulfill the request by
or schedule.                                          make available for public inspection, or     providing a copy of the group return in
   Fees for copies. A tax-exempt                      provide copies of, the application           the time and manner specified in the
organization may charge a reasonable                  submitted to the IRS by the central or       paragraph earlier, Request for copies in
fee for providing copies.                             parent organization to obtain the group      writing.
                                                      exemption letter and those documents
   Before the organization provides the                                                                The requester has the option of
                                                      which were submitted by the central or
documents, it may require that the                                                                 requesting from the central or parent
                                                      parent organization to include the local
individual requesting copies of the                                                                organization, at its principal office,
                                                      or subordinate organization in the group
documents pay the fee. If the                                                                      inspection or copies of group returns
                                                      exemption letter.
organization has provided an individual                                                            filed by the central or parent
making a request with notice of the fee,                  However, if the central or parent        organization. The central or parent
and the individual does not pay the fee               organization submits to the IRS a list or    organization must fulfill such requests
within 30 days, or if the individual pays             directory of local or subordinate            in the time and manner specified in the
the fee by check and the check does                   organizations covered by the group           paragraphs, Special rules relating to
not clear upon deposit, the organization              exemption letter, the local or               public inspection and Special rules
may disregard the request.                            subordinate organization is required to      relating to copies earlier.
                                                      provide only the application for the
    Form of payment — (A) Request                     group exemption ruling and the pages             Failure to comply. If an
made in person. If a tax-exempt                       of the list or directory that specifically   organization fails to comply with the
organization charges a fee for copying,               refer to it. The local or subordinate        requirements specified in this
it must accept payment by cash and                    organization must permit public              paragraph, the penalty provisions of
money order for requests made in                      inspection, or comply with a request for     sections 6652(c)(1)(C), 6652(c)(1)(D),
person. The organization may accept                   copies made in person, within a              and 6685 apply.
other forms of payment, such as credit                reasonable amount of time (normally          Making applications and returns
cards and personal checks.                            not more than 2 weeks) after receiving       widely available. A tax-exempt
   (B) Request made in writing. If a                  a request made in person for public          organization is not required to comply
tax-exempt organization charges a fee                 inspection or copies and at a                with a request for a copy of its
for copying and postage, it must accept               reasonable time of day. See                  application for tax exemption or an
payment by certified check, money                     Regulations section 301.6104(d)-1(f) for     annual information return if the
order, and either personal check or                   further information.                         organization has made the requested
credit card for requests made in writing.                 Annual information returns. A            document widely available (see below).
The organization may accept other                     local or subordinate organization that           An organization that makes its
forms of payment.                                     does not file its own annual information     application for tax exemption and/or
   Avoidance of unexpected fees.                      return (because it is affiliated with a      annual information return widely
Where a tax-exempt organization does                  central or parent organization that files    available must nevertheless make the
not require prepayment and a requester                a group return) must, upon request,          document available for public
does not enclose payment with a                       make available for public inspection, or     inspection as required under
request, an organization must receive                 provide copies of, the group returns         Regulations section 301.6104(d)-1(a).
consent from a requester before                       filed by the central or parent                   A tax-exempt organization makes its
providing copies for which the fee                    organization.                                application for tax exemption and/or an
charged for copying and postage                           However, if the group return includes    annual information return widely
exceeds $20.                                          separate schedules with respect to           available if the organization complies
                                                                         -14-         General Instructions for Form 990 and Form 990-EZ
with the Internet posting requirements     Tax-exempt organization subject to
and the notice requirements given          harassment campaign. If the Director         N. Disclosures Regarding
below.                                     EO Examination (or designee)                 Certain Information and
    Internet posting. A tax-exempt         determines that the organization is          Services Furnished
organization can make its application      being harassed, a tax-exempt
                                           organization is not required to comply       A section 501(c) organization that offers
for tax exemption and/or an annual                                                      to sell or solicits money for specific
information return widely available by     with any request for copies that it
                                           reasonably believes is part of a             information or for a routine service for
posting the document on a World Wide                                                    any individual that could be obtained by
Web page that the tax-exempt               harassment campaign.
                                                                                        such individual from a federal
organization establishes and maintains                                                  government agency free or for a
or by having the document posted, as          Whether a group of requests               nominal charge, must disclose that fact
part of a database of similar documents    constitutes a harassment campaign            conspicuously when making such offer
of other tax-exempt organizations, on a    depends on the relevant facts and            or solicitation. Any organization that
World Wide Web page established and        circumstances such as:                       intentionally disregards this requirement
maintained by another entity. The                                                       will be subject to a penalty for each day
document will be considered widely            A sudden increase in requests; an         on which the offers or solicitations are
available only if:                         extraordinary number of requests by          made. The penalty imposed for a
• The World Wide Web page through          form letters or similarly worded             particular day is the greater of $1,000
which it is available clearly informs      correspondence; hostile requests;            or 50% of the total cost of the offers
readers that the document is available     evidence showing bad faith or                and solicitations made on that day that
and provides instructions for              deterrence of the organization’s exempt      lacked the required disclosure (section
downloading it;                            purpose; prior provision of the              6711).
• The document is posted in a format       requested documents to the purported
that, when accessed, downloaded,           harassing group; and a demonstration
viewed, and printed in hard copy,          that the organization routinely provides     O. Disclosures Regarding
exactly reproduces the image of the        copies of its documents upon request.        Certain Transactions and
application for tax exemption or annual
information return as it was originally                                                 Relationships
filed with the IRS, except for any             A tax-exempt organization may            In their annual returns on Schedule A
information permitted by statute to be     disregard any request for copies of all      (Form 990 or 990-EZ), section
withheld from public disclosure; and       or part of any document beyond the           501(c)(3) organizations must disclose
• Any individual with access to the        first two received within any 30-day         information regarding their direct or
Internet can access, download, view,       period or the first four received within     indirect transfers to, and other direct or
and print the document without special     any 1-year period from the same              indirect relationships with, other section
computer hardware or software              individual or the same address,              501(c) organizations (except other
required for that format (other than       regardless of whether the Director EO        section 501(c)(3) organizations) or
software that is readily available to      Examination (or designee) has                section 527 political organizations
members of the public without payment      determined that the organization is          (section 6033(b)(9)). This provision
of any fee) and without payment of a       subject to a harassment campaign.            helps prevent the diversion or
fee to the tax-exempt organization or to                                                expenditure of a section 501(c)(3)
another entity maintaining the World           A tax-exempt organization may            organization’s funds for purposes not
Wide Web page.                             apply for a determination that it is the     intended by section 501(c)(3). All
                                           subject of a harassment campaign and         section 501(c)(3) organizations must
    Reliability and accuracy. In order                                                  maintain records regarding all such
for the document to be widely available    that compliance with requests that are
                                           part of the campaign would not be in         transfers, transactions, and
through an Internet posting, the entity                                                 relationships. See also General
maintaining the World Wide Web page        the public interest by submitting a
                                           signed application to the Director EO        Instruction K regarding penalties.
must have procedures for ensuring the
reliability and accuracy of the document   Examination (or designee) for the area
that it posts on the page and must take    where the organization’s principal office    P. Intermediate Sanction
reasonable precautions to prevent          is located.
alteration, destruction, or accidental
                                                                                        Regulations—Excess
loss of the document when posted on           In addition, the organization may         Benefit Transactions
its page. In the event that a posted       suspend compliance with any request it       The intermediate sanction regulations
document is altered, destroyed, or lost,   reasonably believes to be part of the        are important to the exempt
the entity must correct or replace the     harassment campaign until it receives a      organization community as a whole,
document.                                  response to its application for a            and for ensuring compliance in this
   Notice requirement. If a                harassment campaign determination.           area. The rules provide a roadmap by
tax-exempt organization has made its       However, if the Director EO                  which an organization may steer clear
application for tax exemption and/or an    Examination (or designee) determines         of situations that may give rise to
annual information return widely           that the organization did not have a         inurement.
available, it must notify any individual   reasonable basis for requesting a               Under section 4958, any disqualified
requesting a copy where the                determination that it was subject to a       person who benefits from an excess
documents are available (including the     harassment campaign or reasonable            benefit transaction with an applicable
address on the World Wide Web, if          belief that a request was part of the        tax-exempt organization is liable for a
applicable). If the request is made in     campaign, the officer, director, trustee,    25% tax on the excess benefit. The
person, the organization must provide      employee, or other responsible               disqualified person is also liable for a
such notice to the individual              individual of the organization remains       200% tax on the excess benefit if the
immediately. If the request is made in     liable for any penalties for not providing   excess benefit is not corrected by a
writing, the notice must be provided       the copies in a timely fashion. See          certain date. Also, organization
within 7 days of receiving the request.    Regulations section 301.6104(d)-3.           managers who participate in an excess
General Instructions for Form 990 and Form 990-EZ            -15-
benefit transaction knowingly, willfully,   person, and 35% controlled entities of a    • The person owns a controlling
and without reasonable cause are liable     disqualified person.                        interest (measured by either vote or
for a 10% tax on the excess benefit, not       The following persons are                value) in a corporation, partnership, or
to exceed $20,000 for all participating     considered disqualified persons along       trust that is a disqualified person.
managers on each transaction.               with certain family members and 35%         • The person is a nonstock
                                            controlled entities associated with them:   organization controlled directly or
Applicable Tax-Exempt
Organization                                • Donors of donor advised funds,            indirectly by one or more disqualified
                                            • Investment advisors of sponsoring         persons.
These rules only apply to certain           organizations, and                              Facts and circumstances tending
applicable section 501(c)(3) and            • The disqualified persons of a section     to show no substantial influence:
501(c)(4) organizations. An applicable
tax-exempt organization is a section
                                            509(a)(3) supporting organization for       • The person is an independent
                                            the organizations that organization         contractor whose sole relationship to
501(c)(3) or a section 501(c)(4)            supports.
organization that is tax-exempt under                                                   the organization is providing
section 501(a), or was such an                 Substantial contributors to              professional advice (without having
organization at any time during a 5-year    supporting organizations are also           decision-making authority) with respect
period ending on the day of the excess      considered disqualified persons along       to transactions from which the
benefit transaction.                        with their family members and 35%           independent contractor will not
                                            controlled entities.                        economically benefit.
    An applicable tax-exempt
                                               See the Instructions for Form 4720,
                                                                                        • The person has taken a vow of
organization does not include:                                                          poverty.
• A private foundation as defined in        Schedule I for more information
                                                                                        • Any preferential treatment the person
section 509(a).                             regarding these disqualified persons.
                                                                                        receives based on the size of the
• A governmental entity that is exempt      Who is not a disqualified person?           person’s donation is also offered to
from (or not subject to) taxation without   The rules also clarify which persons are    others making comparable widely
regard to section 501(a) or relieved        not considered to be in a position to       solicited donations.
from filing an annual return under
Regulations section 1.6033-2(g)(6).
                                            exercise substantial influence over the     • The direct supervisor of the person is
                                            affairs of an organization. They include:   not a disqualified person.
• Certain foreign organizations.            • An employee who receives benefits         • The person does not participate in
    An organization is not treated as a     that total less than the highly             any management decisions affecting
section 501(c)(3) or 501(c)(4)              compensated amount ($100,000 in             the organization as a whole or a
organization for any period covered by      2007) and who does not hold the             discrete segment of the organization
a final determination that the              executive or voting powers just             that represents a substantial portion of
organization was not tax-exempt under       mentioned; is not a family member of a      the activities, assets, income, or
section 501(a), so long as the              disqualified person; and is not a           expenses of the organization, as
determination was not based on private      substantial contributor;                    compared to the organization as a
inurement or one or more excess             • Tax-exempt organizations described        whole.
benefit transactions.                       in section 501(c)(3); and
                                            • Section 501(c)(4) organizations with      What about persons who staff
Disqualified Person                         respect to transactions engaged in with     affiliated organizations? In the case
The vast majority of section 501(c)(3) or   other section 501(c)(4) organizations.      of multiple affiliated organizations, the
501(c)(4) organization employees and        Who else may be considered a                determination of whether a person has
contractors will not be affected by these   disqualified person? Other persons          substantial influence is made
rules. Only the few influential persons     not described above can also be             separately for each applicable
within these organizations are covered      considered disqualified persons,            tax-exempt organization. A person may
by these rules when they receive            depending on all the relevant facts and     be a disqualified person with respect to
benefits, such as compensation, fringe      circumstances.                              transactions with more than one
benefits, or contract payments. The IRS                                                 organization.
calls this class of covered individuals        Facts and circumstances tending
disqualified persons.                       to show substantial influence:              Excess Benefit Transaction
                                            • The person founded the organization.      An excess benefit transaction is a
    A disqualified person, regarding any    • The person is a substantial               transaction in which an economic
transaction, is any person who was in a     contributor to the organization under
position to exercise substantial                                                        benefit is provided by an applicable
                                            the section 507(d)(2)(A) definition, only   tax-exempt organization, directly or
influence over the affairs of the           taking into account contributions to the
applicable tax-exempt organization at                                                   indirectly, to or for the use of any
                                            organization for the past 5 years.          disqualified person, and the value of
any time during a 5-year period ending      • The person’s compensation is              the economic benefit provided by the
on the date of the transaction. Persons     primarily based on revenues derived
who hold certain powers,                                                                organization exceeds the value of the
                                            from activities of the organization that    consideration (including the
responsibilities, or interests are among    the person controls.                        performance of services) received for
those who are in a position to exercise     • The person has or shares authority to     providing such benefit. An excess
substantial influence over the affairs of   control or determine a substantial
the organization. This would include, for                                               benefit transaction also can occur when
                                            portion of the organization’s capital       a disqualified person embezzles from
example, voting members of the              expenditures, operating budget, or
governing body, and persons holding                                                     the exempt organization.
                                            compensation for employees.
the power of:                               • The person manages a discrete                 To determine whether an excess
• Presidents, chief executive officers,     segment or activity of the organization     benefit transaction has occurred, all
or chief operating officers.                that represents a substantial portion of    consideration and benefits exchanged
• Treasurers and chief financial            the activities, assets, income, or          between a disqualified person and the
officers.                                   expenses of the organization, as            applicable tax-exempt organization, and
    A disqualified person also includes     compared to the organization as a           all entities it controls, are taken into
certain family members of a disqualified    whole.                                      account.
                                                              -16-         General Instructions for Form 990 and Form 990-EZ
    For purposes of determining the         When does an excess benefit                    bonuses, severance payments, and
value of economic benefits, the value of    transaction usually occur? An                  deferred and noncash compensation.
property, including the right to use        excess benefit transaction occurs on           • The payment of liability insurance
property, is the fair market value. Fair    the date the disqualified person               premiums for, or the payment or
market value is the price at which          receives the economic benefit from the         reimbursement by the organization of
property, or the right to use property,     organization for federal income tax            taxes or certain expenses under section
would change hands between a willing        purposes. However, when a single               4958, unless excludable from income
buyer and a willing seller, neither being   contractual arrangement provides for a         as a de minimis fringe benefit under
under any compulsion to buy, sell, or       series of compensation payments or             section 132(a)(4). (A similar rule applies
transfer property or the right to use       other payments to a disqualified person        in the private foundation area.)
property, and both having reasonable        during the disqualified person’s tax           Inclusion in compensation for purposes
knowledge of relevant facts.                year, any excess benefit transaction           of determining reasonableness under
                                            with respect to these payments occurs          section 4958 does not control inclusion
Donor advised funds. For a donor            on the last day of the taxpayer’s tax          in income for income tax purposes.
advised fund, an excess benefit             year.                                          • All other compensatory benefits,
transaction includes a grant, loan,                                                        whether or not included in gross income
compensation, or similar payment from           In the case of the transfer of property
                                            subject to a substantial risk of forfeiture,   for income tax purposes.
the fund to a:                                                                             • Taxable and nontaxable fringe
• Donor or donor advisor,                   or in the case of rights to future
                                                                                           benefits, except fringe benefits
• Family member of a donor, or donor        compensation or property, the
                                            transaction occurs on the date the             described in section 132.
advisor,
                                            property, or the rights to future              • Foregone interest on loans.
• 35% controlled entity of a donor, or      compensation or property, is not
donor advisor, or                                                                             Written intent required to treat
                                            subject to a substantial risk of forfeiture.
• 35% controlled entity of a family         Where the disqualified person elects to
                                                                                           benefits as compensation. An
member of a donor, or donor advisor.                                                       economic benefit is not treated as
                                            include an amount in gross income in           consideration for the performance of
   The excess benefit in this               the tax year of transfer under section         services unless the organization
transaction is the amount of the grant,     83(b), the excess benefit transaction          providing the benefit clearly indicates its
loan, compensation, or similar payment.     occurs on the date the disqualified            intent to treat the benefit as
For additional information see the          person receives the economic benefit           compensation when the benefit is paid.
Instructions for Form 4720.                 for federal income tax purposes.
                                                Section 4958 applies only to                  An applicable tax-exempt
Supporting organizations. For any           post-September 1995 transactions.              organization (or entity that it controls) is
supporting organization, defined in         Section 4958 applies to excess benefit         treated as clearly indicating its intent to
section 509(a)(3), an excess benefit        transactions occurring on or after             provide an economic benefit as
transaction includes grants, loans,         September 14, 1995. Section 4958               compensation for services only if the
compensation, or similar payment            does not apply to any transaction              organization provides written
provided by the supporting organization     occurring pursuant to a written contract       substantiation that is contemporaneous
to a:                                       that was binding on September 13,              with the transfer of the economic
• Substantial contributor,                  1995, and at all times thereafter before       benefits under consideration. Ways to
• Family member of a substantial            the transaction occurs.                        provide contemporaneous written
contributor,                                                                               substantiation of its intent to provide an
                                            What is reasonable compensation?
• 35% controlled entity of a substantial    Reasonable compensation is the
                                                                                           economic benefit as compensation
contributor, or                                                                            include:
                                            valuation standard that is used to             • The organization produces a signed
• 35% controlled entity of a family         determine if there is an excess benefit
member of a substantial contributor.                                                       written employment contract;
                                            in the exchange of a disqualified              • The organization reports the benefit
   Additionally, an excess benefit          person’s services for compensation.            as compensation on an original Form
transaction includes any loans provided         Reasonable compensation is the             W-2, Form 1099 or Form 990, or on an
by the supporting organization to a         value that would ordinarily be paid for        amended form filed prior to the start of
disqualified person (other than an          like services by like enterprises under        an IRS examination; or
organization described in section           like circumstances. This is the section        • The disqualified person reports the
509(a)(1), (2), or (4)).                    162 standard that will apply in                benefit as income on the person’s
                                            determining the reasonableness of              original Form 1040 or on an amended
   A substantial contributor is any         compensation. The fact that a bonus or         form filed prior to the start of an IRS
person who contributed or bequeathed        revenue-sharing arrangement is subject         examination.
an aggregate of more than $5,000 to         to a cap is a relevant factor in
the organization, if that amount is more    determining the reasonableness of                  Exception. To the extent the
than 2% of the total contributions and      compensation.                                  economic benefit is excluded from the
bequests received by the organization                                                      disqualified person’s gross income for
before the end of the tax year of the           For determining the reasonableness         income tax purposes, the applicable
organization in which the contribution or   of compensation, all items of                  tax-exempt organization is not required
bequest is received by the organization     compensation provided by an                    to indicate its intent to provide an
from such person. A substantial             applicable tax-exempt organization in          economic benefit as compensation for
contributor includes the grantor of a       exchange for the performance of                services. (For example, employer
trust.                                      services are taken into account in             provided health benefits, and
                                            determining the value of compensation          contributions to qualified plans under
   The excess benefit for substantial       (except for certain economic benefits          section 401(a).)
contributors and parties related to those   that are disregarded, as discussed in
contributors includes the amount of the     What benefits are disregarded? later).         What benefits are disregarded? The
grant, loan, compensation, or similar       Items of compensation include:                 following economic benefits are
payment. For additional information see     • All forms of cash and noncash                disregarded for purposes of section
the Instructions for Form 4720.             compensation, including salary, fees,          4958.
General Instructions for Form 990 and Form 990-EZ              -17-
• Nontaxable fringe benefits. An               is a material change, which includes an     the exact amount of the payment is
economic benefit that is excluded from         extension or renewal of the contract        determined, or a fixed formula for
income under section 132.                      (except for an extension or renewal         calculating the payment is specified,
• Benefits to volunteer. An economic           resulting from the exercise of an option    and the three requirements creating the
benefit provided to a volunteer for the        by the disqualified person), or a more      presumption have been satisfied.
organization if the benefit is provided to     than incidental change to the amount        However, if the authorized body
the general public in exchange for a           payable under the contract, is treated      approves an employment contract with
membership fee or contribution of $75          as a new contract as of the effective       a disqualified person that includes a
or less per year.                              date of the material change. Treatment      nonfixed payment (for example,
• Benefits to members or donors. An            as a new contract may cause the             discretionary bonus) with a specified
economic benefit provided to a member          contract to fall outside the initial        cap on the amount, the authorized body
of an organization due to the payment          contract exception, and it thus would be    may establish a rebuttable presumption
of a membership fee, or to a donor as a        tested under the fair market value          as to the nonfixed payment when the
result of a deductible contribution, if a      standards of section 4958.                  employment contract is entered into by,
significant number of nondisqualified                                                      in effect, assuming that the maximum
persons make similar payments or               Rebuttable Presumption of                   amount payable under the contract will
contributions and are offered a similar        Reasonableness                              be paid, and satisfying the
economic benefit.                              Payments under a compensation               requirements giving rise to the
• Benefits to a charitable beneficiary.        arrangement are presumed to be              rebuttable presumption for that
An economic benefit provided to a              reasonable and the transfer of property     maximum amount.
person solely as a member of a                 (or right to use property) is presumed to
charitable class that the applicable                                                       An IRS challenge to the presumption
                                               be at fair market value, if the following   of reasonableness. The Internal
tax-exempt organization intends to             three conditions are met.
benefit as part of the accomplishment                                                      Revenue Service may refute the
                                                   1. The transaction is approved by       presumption of reasonableness only if it
of its exempt purpose.                         an authorized body of the organization
• Benefits to a governmental unit. A                                                       develops sufficient contrary evidence to
                                               (or an entity it controls) which is         rebut the probative value of the
transfer of an economic benefit to or for      composed of individuals who do not
the use of a governmental unit, as                                                         comparability data relied upon by the
                                               have a conflict of interest concerning      authorized body. This provision gives
defined in section 170(c)(1), if               the transaction.
exclusively for public purposes.                                                           taxpayers added protection if they
                                                   2. Prior to making its determination,   faithfully find and use contemporaneous
Is there an exception for initial              the authorized body obtained and relied     persuasive comparability data when
contracts? Section 4958 does not               upon appropriate data as to                 they provide the benefits.
apply to any fixed payment made to a           comparability. There is a special safe
person pursuant to an initial contract.        harbor for small organizations. If the      Organizations that do not establish a
This is a very important exception,            organization has gross receipts of less     presumption of reasonableness. An
since it would potentially apply, for          than $1 million, appropriate                organization may still comply with
example, to all initial contracts with         comparability data includes data on         section 4958 even if it did not establish
new, previously unrelated officers and         compensation paid by three                  a presumption of reasonableness. In
contractors.                                   comparable organizations in the same        some cases, an organization may find it
                                               or similar communities for similar          impossible or impracticable to fully
    An initial contract is a binding written
                                               services.                                   implement each step of the rebuttable
contract between an applicable
                                                   3. The authorized body adequately       presumption process described above.
tax-exempt organization and a person
                                               documents the basis for its                 In such cases, the organization should
who was not a disqualified person
                                               determination concurrently with making      try to implement as many steps as
immediately prior to entering into the
                                               that determination. The documentation       possible, in whole or in part, in order to
contract.
                                               should include:                             substantiate the reasonableness of
    A fixed payment is an amount of                                                        benefits as timely and as well as
cash or other property specified in the            a. The terms of the approved
                                                                                           possible. If an organization does not
contract, or determined by a fixed             transaction and the date approved;
                                                                                           satisfy the requirements of the
formula that is specified in the contract,         b. The members of the authorized
                                                                                           rebuttable presumption of
which is to be paid or transferred in          body who were present during debate
                                                                                           reasonableness, a facts and
exchange for the provision of specified        on the transaction that was approved
                                                                                           circumstances approach will be
services or property.                          and those who voted on it;
                                                                                           followed, using established rules for
                                                   c. The comparability data obtained
    A fixed formula may, in general,                                                       determining reasonableness of
                                               and relied upon by the authorized body
incorporate an amount that depends                                                         compensation and benefit deductions in
                                               and how the data was obtained;
upon future specified events or                                                            a manner similar to the established
                                                   d. Any actions by a member of the
contingencies, as long as no one has                                                       procedures for section 162 business
                                               authorized body having a conflict of
discretion when calculating the amount                                                     expenses.
                                               interest; and
of a payment or deciding whether to                e. Documentation of the basis for
make a payment (such as a bonus).                                                          Section 4958 Taxes
                                               the determination before the later of the
    Treatment as new contract. A               next meeting of the authorized body or      Tax on disqualified persons. An
binding written contract providing that it     60 days after the final actions of the      excise tax equal to 25% of the excess
may be terminated or cancelled by the          authorized body are taken, and              benefit is imposed on each excess
applicable tax-exempt organization             approval of records as reasonable,          benefit transaction between an
without the other party’s consent              accurate and complete within a              applicable tax-exempt organization and
(except as a result of substantial             reasonable time thereafter.                 a disqualified person. The disqualified
non-performance) and without                                                               person who benefited from the
substantial penalty, is treated as a new       Special rebuttable presumption rule         transaction is liable for the tax. If the
contract, as of the earliest date that any     for nonfixed payments. As a general         25% tax is imposed and the excess
termination or cancellation would be           rule, in the case of a nonfixed payment,    benefit transaction is not corrected
effective. Also, a contract in which there     no rebuttable presumption arises until      within the taxable period, an additional
                                                                 -18-         General Instructions for Form 990 and Form 990-EZ
excise tax equal to 200% of the excess       disclosure of the factual situation to an   property is less than the correction
benefit is imposed.                          appropriate professional, the               amount, the disqualified person must
    If a disqualified person makes a         organization manager relied on the          make an additional cash payment to
payment of less than the full correction     professional’s reasoned written opinion     the organization equal to the difference.
amount, the 200% tax is imposed only         on matters within the professional’s
                                             expertise or if the manager relied on           Excess payment. If the payment
on the unpaid portion of the correction                                                  resulting from the return of the property
amount. If more than one disqualified        the fact that the requirements for the
                                             rebuttable presumption of                   exceeds the correction amount
person received an excess benefit from                                                   described above, the organization may
an excess benefit transaction, all such      reasonableness have been satisfied.
                                             Participation by an organization            make a cash payment to the
disqualified persons are jointly and                                                     disqualified person equal to the
severally liable for the taxes.              manager is willful if it is voluntary,
                                             conscious, and intentional. An              difference.
    To avoid the imposition of the 200%      organization manager’s participation is
tax, a disqualified person must correct      due to reasonable cause if the manager      Churches and Section 4958
the excess benefit transaction during        has exercised responsibility on behalf      The regulations make it clear that the
the taxable period. The taxable period       of the organization with ordinary           IRS will apply the procedures of section
begins on the date the transaction           business care and prudence.                 7611 when initiating and conducting
occurs and ends on the earlier of the                                                    any inquiry or examination into whether
date the statutory notice of deficiency is   Correcting an Excess Benefit                an excess benefit transaction has
issued or the section 4958 taxes are         Transaction                                 occurred between a church and a
assessed. This 200% tax may be                                                           disqualified person.
                                             A disqualified person corrects an
abated if the excess benefit transaction
                                             excess benefit transaction by undoing
subsequently is corrected during a                                                       Revenue Sharing Transactions
                                             the excess benefit to the extent
90-day correction period.                                                                Proposed intermediate sanction
                                             possible, and by taking any additional
Tax on organization managers. An             measures necessary to place the             regulations were issued in 1998. The
excise tax equal to 10% of the excess        organization in a financial position not    proposed regulations had special
benefit may be imposed on the                worse than that in which it would be if     provisions covering “any transaction in
participation of an organization             the disqualified person were dealing        which the amount of any economic
manager in an excess benefit                 under the highest fiduciary standards.      benefit provided to or for the use of a
transaction between an applicable            The organization is not required to         disqualified person is determined in
tax-exempt organization and a                rescind the underlying agreement;           whole or in part by the revenues of one
disqualified person. This tax, which may     however, the parties may need to            or more activities of the organization. .
not exceed $20,000 for any single            modify an ongoing contract with respect     .” — so-called revenue-sharing
transaction, is only imposed if the 25%      to future payments.                         transactions. Rather than setting forth
tax is imposed on the disqualified                                                       additional rules on revenue-sharing
person, the organization manager                 A disqualified person corrects an
                                                                                         transactions, the final regulations
knowingly participated in the                excess benefit by making a payment in
                                                                                         reserve this section. Consequently, until
transaction, and the manager’s               cash or cash equivalents equal to the
                                                                                         the Service issues new regulations for
participation was willful and not due to     correction amount to the applicable
                                                                                         this reserved section on
reasonable cause. There is also joint        tax-exempt organization. The correction
                                                                                         revenue-sharing transactions, these
and several liability for this tax. An       amount equals the excess benefit plus
                                                                                         transactions will be evaluated under the
organization manager may be liable for       the interest on the excess benefit; the
                                                                                         general rules (for example, the fair
both the tax on disqualified persons         interest rate may be no lower than the
                                                                                         market value standards) that apply to
and on organization managers in              applicable Federal rate. There is an
                                                                                         all contractual arrangements between
appropriate circumstances.                   anti-abuse rule to prevent the
                                                                                         applicable tax-exempt organizations
                                             disqualified person from effectively
    An organization manager is any                                                       and their disqualified persons.
                                             transferring property other than cash or
officer, director, or trustee of an          cash equivalents.
applicable tax-exempt organization, or                                                   Revocation of Exemption and
any individual having powers or                  Exception. For a correction of an       Section 4958
responsibilities similar to officers,        excess benefit transaction described in
                                             Donor advised funds (discussed              Section 4958 does not affect the
directors, or trustees of the                                                            substantive standards for tax exemption
organization, regardless of title. An        earlier), no amount repaid in a manner
                                             prescribed by the Secretary may be          under section 501(c)(3) or section
organization manager is not considered                                                   501(c)(4), including the requirements
to have participated in an excess            held in a donor advised fund.
                                                                                         that the organization be organized and
benefit transaction where the manager        Property. With the agreement of the         operated exclusively for exempt
has opposed the transaction in a             applicable tax-exempt organization, a       purposes, and that no part of its net
manner consistent with the fulfillment of    disqualified person may make a              earnings inure to the benefit of any
the manager’s responsibilities to the        payment by returning the specific           private shareholder or individual. The
organization. For example, a director        property previously transferred in the      legislative history indicates that in most
who votes against giving an excess           excess benefit transaction. The return      instances, the imposition of this
benefit would ordinarily not be subject      of the property is considered a payment     intermediate sanction will be in lieu of
to this tax.                                 of cash (or cash equivalent) equal to       revocation. The IRS has indicated that
    A person participates in a               the lesser of:                              the following four factors will be
transaction knowingly if the person has      • The fair market value of the property     considered in determining whether to
actual knowledge of sufficient facts so      on the date the property is returned to     revoke an applicable tax-exempt
that, based solely upon such facts, the      the organization, or                        organization’s exemption status where
transaction would be an excess benefit       • The fair market value of the property     an excess benefit transaction has
transaction. Knowing does not mean           on the date the excess benefit              occurred:
having reason to know. The                   transaction occurred.                       • Whether the organization has been
organization manager ordinarily will not         Insufficient payment. If the            involved in repeated excess benefit
be considered knowing if, after full         payment resulting from the return of the    transactions;
General Instructions for Form 990 and Form 990-EZ              -19-
• The size and scope of the excess                If the central organization prepares a
benefit transaction;                          group return for its affiliated               U. Political Organizations
• Whether, after concluding that it has       organizations, check the “Yes” box in         A political organization subject to
been party to an excess benefit               item H(a), in the heading of Form 990,        section 527 is a party, committee,
transaction, the organization has             and indicate the number of                    association, fund, or other organization
implemented safeguards to prevent             organizations for which the group return      (whether or not incorporated) organized
future recurrences; and                       is filed in item H(b).                        and operated primarily for the purpose
• Whether there was compliance with               For item H(c), check “Yes,” to            of directly or indirectly accepting
other applicable laws.                        indicate that the group return includes       contributions or making expenditures,
                                              all affiliated organizations covered by       or both, for an exempt function.
Q. Erroneous Backup                           the group ruling. If the organization             The exempt function of a political
                                              answers “No” to H(c), attach a list           organization is influencing or attempting
Withholding                                   showing the name, address, and EIN of         to influence the selection, nomination,
Recipients of dividend or interest            each affiliated organization included in      election or appointment of an individual
payments generally must certify their         the group return. If either box in H(a) or    to a federal, state, or local public office
correct taxpayer identification number        H(d) is checked “Yes,” enter the              or office in a political organization. A
to the bank or other payer on Form            four-digit group exemption number             political organization must be organized
W-9. If the payer does not get this           (GEN). Do not confuse the four-digit          for the primary purpose of carrying on
information, it must withhold part of the     GEN number to be reported for item I          exempt function activities.
payments as backup withholding. If the        with the nine-digit EIN number reported           A political organization does not
organization was subject to erroneous         in item D of the form’s heading.              need to be formally chartered or
backup withholding because the payer                                                        established as a corporation, trust, or
did not realize it was an exempt                 The central organization should send
                                              the annual information required to            association. A separate bank account in
organization and not subject to this                                                        which political campaign funds are
withholding, it can claim credit on Form      maintain a group exemption letter to
                                              the:                                          deposited and disbursed only for
990-T for the amount withheld. See the                                                      political campaign expenses can qualify
Instructions for Form 990-T. Claims for            Department of Treasury                   as a political organization.
refund must be filed within 3 years after          Internal Revenue Service Center
the date the original return was due; 3            Ogden, UT 84201-0027
years after the date the organization
                                                 An affiliated organization covered by      V. Information Regarding
filed it; or 2 years after the date the tax                                                 Transfers Associated With
                                              a group ruling may file a separate
was paid, whichever is later.
                                              return instead of being included in the       Personal Benefit Contracts
                                              group return. In such case, check the         Filers of Form 990 that engaged in
R. Group Return                               “Yes” box in item H(d), in the heading        activities involving personal benefit
                                              of Form 990, and enter the GEN                contracts must declare in Part X,
If a parent organization wants to file a      number in item I.
group return for two or more of its                                                         Information Regarding Transfers
subsidiaries, it must use Form 990. The          Parts IV-A and IV-B of Form 990 do         Associated With Personal Benefit
parent organization cannot use a Form         not have to be completed on group             Contracts, whether or not they:
990-EZ for the group return.                  returns.                                          1. Received any funds, directly or
   A central, parent, or like organization                                                  indirectly, to pay premiums on a
can file a group return on Form 990 for                                                     personal benefit contract.
                                              S. Organizations in Foreign                       2. Paid any premiums, directly or
two or more local organizations that
are:                                          Countries and U.S.                            indirectly, on a personal benefit
   1. Affiliated with the central             Possessions                                   contract.
organization at the time its annual           Refer to General Instruction B for the
                                              filing exemption for foreign                            Filers of Form 990-EZ must
accounting period ends,
   2. Subject to the central                  organizations with $25,000 or less in           !
                                                                                            CAUTION
                                                                                                      make this declaration in a
                                                                                                      statement attached to their form.
organization’s general supervision or         gross receipts from U.S. sources.
control,                                         Report amounts in U.S. dollars and             If premiums were paid on a personal
   3. Exempt from tax under a group           state what conversion rate the                benefit contract, the organization must
exemption letter that is still in effect,     organization uses. Combine amounts            report these payments on Form 8870
and                                           from within and outside the United            and pay an excise tax, equal to
   4. Have the same accounting period         States and report the total for each          premiums paid, with Form 4720.
as the central organization.                  item. All information must be written in          Section 170(f)(10)(F)(iii) requires a
                                              English.                                      charitable organization to report
    If the parent organization is required                                                  annually its premium payments on a
to file a return for itself, it must file a                                                 personal benefit contract with respect to
separate return and may not be                T. Public Interest Law Firms                  a transferor and to identify the
included in the group return. See             A public interest law firm exempt under       beneficiaries of those contracts. A
General Instruction B for a list of           section 501(c)(3) or 501(c)(4) must           transferor of funds to a charitable
organizations not required to file.           attach a statement that lists the cases       organization receives no charitable
    Every year, each local organization       in litigation, or that have been litigated    contribution deduction if the
must authorize the central organization       during the year. For each case,               organization, directly or indirectly, pays,
in writing to include it in the group         describe the matter in dispute and            or has previously paid, any premium on
return and must declare, under penalty        explain how the litigation will benefit the   a personal benefit contract with respect
of perjury, that the authorization and        public generally. Also attach a report of     to the transferor, or there is an
the information it submits to be included     all fees sought and recovered in each         understanding or expectation that any
in the group return are true and              case. See Rev. Proc. 92-59, 1992-2            person will directly or indirectly pay any
complete.                                     C.B. 411.                                     premium on a personal benefit contract
                                                                 -20-          General Instructions for Form 990 and Form 990-EZ
with respect to the transferor (section         organizations, and other charities        transaction will be excluded from the
170(f)(10)(A)).                                 described in section 501(c)(3);           definition of listed transaction,
                                                   c. Civic leagues, social welfare       confidential transaction, or transaction
   A personal benefit contract,
                                                organizations, and local associations     with contractual protection, the
generally, is any life insurance, annuity,
                                                of employees described in section         transaction will not be considered a
or endowment contract that benefits,
                                                501(c)(4);                                prohibited tax shelter transaction.
directly or indirectly, the transferor, a
                                                    d. Labor, agricultural, or            Listed transaction. A listed
member of the transferor’s family, or
                                                horticultural organizations described     transaction is a transaction that is the
any other person designated by the
                                                in section 501(c)(5);                     same as or substantially similar to any
transferor (other than an organization
                                                    e. Business leagues, chambers of      of the types of transactions that the IRS
described in section 170(c)). A
                                                commerce, trade associations, and         has determined to be a tax avoidance
charitable organization is an
                                                other organizations described in          transaction and are identified by notice,
organization described in section
                                                section 501(c)(6);                        regulation, or other form of published
170(c).
                                                    f. Voluntary employees’               guidance as a listed transaction. For
   Section 170(f)(10)(F)(i) imposes on a        beneficiary associations (VEBAs)          existing guidance see:
charitable organization an excise tax           described in section 501(c)(9);           • Notice 2004-67, 2004-41 I.R.B. 600;
equal to the premiums paid by the                   g. Credit unions described in         • Notice 2005-13, 2005-9 I.R.B. 630;
organization on any personal benefit            section 501(c)(14);                       and
contract, if the payment of premiums is             h. Insurance companies                • Notice 2007-57, 2007-29 I.R.B. 87.
in connection with a transfer for which a       described in section 501(c)(15); and
deduction is not allowed under section              i. Veterans’ organizations            For updates to this list go to the IRS
170(f)(10)(A). For purposes of this             described in section 501(c)(19).          web page at www.irs.gov/businesses/
excise tax, section 170(f)(10)(F)(ii)            2. Religious or apostolic                corporations and click on Abusive Tax
provides that premium payments made          associations or corporations described       Shelters and Transactions. The IRS
by any other person, pursuant to an          in section 501(d).                           may issue new or update the existing
understanding or expectation described           3. Entities described in section         notice, regulation, announcement, or
in section 170(f)(10)(A), are treated as     170(c), including states, possessions of     other forms of published guidance that
made by the charitable organization.         the United States, the District of           identify transactions as listed
   For more information on the               Columbia, political subdivisions of          transactions. You can find a notice or
reporting requirements of section            states, and political subdivisions of        ruling in the Internal Revenue Bulletin
170(f)(10), see Notice 2000-24,              possessions of the United States (but        at www.irs.gov/pub/irs-irbs/
2000-17 I.R.B. 952 (2000-1 C.B. 952)         not including the United States).            irbXX-YY.pdf, where XX is the two-digit
and Announcement 2000-82, 2000-42                4. Indian tribal governments within      year and YY is the two-digit bulletin
I.R.B. 385 (2000-2 C.B. 385).                the meaning of section 7701(a)(40).          number. For example, you can find
                                             Definition of a party to a prohibited        Notice 2004-67, 2004-41 I.R.B. 600, at
                                             tax shelter transaction. A tax-exempt        www.irs.gov/pub/irs-irbs/irb04-41.pdf.
W. Prohibited Tax Shelter                    entity is a party to a transaction if it:        Subsequently listed transaction.
Transactions and                             • Facilitates the transaction by reason      A subsequently listed transaction is a
Related Disclosure                           of its tax-exempt, tax-indifferent, or       transaction that is identified in
                                             tax-favored status, or                       published guidance as a listed
Requirements                                 • Enters into a listed transaction and       transaction after the tax-exempt entity
New section 4965 imposes an excise           the tax-exempt entity’s return (original     has entered into the transaction and
tax on:                                      or amended) reflects a reduction or          that was not a confidential transaction
• Certain tax-exempt entities that are a     elimination of liability for applicable      or transaction with contractual
party to a prohibited tax shelter            federal employment, excise, or               protection at the time the entity entered
transaction, and                             unrelated business income taxes that is      into the transaction. See section
• Any entity manager who approves or         derived directly or indirectly from tax      4965(e)(2) for more information.
otherwise causes the entity to be a          consequences or tax strategy described
party to a prohibited tax shelter                                                             Substantially similar. A
                                             in the published guidance that lists the     transaction is substantially similar to
transaction and knows or has reason to       transaction; or                              another transaction if it is expected to
know that the transaction is a prohibited    • Is identified in published guidance by     obtain the same or similar types of tax
tax shelter transaction.                     type, class, or role as party to a           consequences and is either factually
                                             prohibited tax shelter transaction.          similar or based on the same or similar
Additionally, section 6033 provides new
                                             Entity manager. An entity manager is         tax strategy. Receipt of an opinion
disclosure requirements on a
                                             any person with authority or                 regarding the tax consequences of the
tax-exempt entity that is a party to a
                                             responsibility similar to that exercised     transaction is not relevant to the
prohibited tax shelter transaction. See
                                             by an officer, director, or trustee, and,    determination of whether the
Form 8886-T and it’s instructions for
                                             for any act, the person that has final       transaction is the same as or
more information.
                                             authority or responsibility with respect     substantially similar to another
Tax-exempt entities. Tax-exempt              to such act.                                 transaction. Further, the term
entities that are subject to section 4965    Prohibited tax shelter transaction.          substantially similar must be broadly
include:                                     Generally, a prohibited tax shelter          construed in favor of disclosure. See
    1. Entities described in section         transaction is a transaction that is a       Regulations section 1.6011-4(c)(4) for
501(c), including but not limited to the     listed transaction (including                examples.
following common types of entities:          subsequently listed transaction), a          Confidential transaction. A
       a. Instrumentalities of the United    confidential transaction, or a transaction   confidential transaction is a transaction
    States described in section              with contractual protection. See             this is offered under conditions of
    501(c)(1);                               definitions of these terms later.            confidentiality and for which a minimum
       b. Churches, hospitals, museums,      Note. In general, if the IRS determines      fee (defined below) was paid. A
    schools, scientific research             by published guidance that a                 transaction is considered to be offered
General Instructions for Form 990 and Form 990-EZ              -21-
under conditions of confidentiality if the     how it is figured, see the Instructions for   return he or she files for a corporation
advisor places a limitation on disclosure      Form 4720.                                    or association. For a trust, the
of the tax treatment or tax structure of                                                     authorized trustee(s) must sign.
the transaction and the limitation on          Required Disclosure
                                                                                                 The paid preparer must:
disclosure protects the confidentiality of     Certain tax-exempt entities are required      • Sign the return in the space provided
the advisor’s tax strategies. The              to file disclosure information of:            for the preparer’s signature.
transaction is treated as confidential         • Such entity being a party to any            • Enter the preparer’s social security
even if the conditions of confidentiality      prohibited tax shelter transaction, and       number (SSN), preparer tax
are not legally binding. See Regulations       • The identity of any other known party       identification number (PTIN), or
section 1.6011-4(b)(3) for more                to the prohibited tax shelter transaction.    employer identification number (EIN),
information.                                       Use Form 8886-T to report the             only if the Form 990, or Form 990-EZ,
   Minimum fee. For a corporation,             disclosure. Entities that fail to file the    is for a section 4947(a)(1) nonexempt
or a partnership or trust in which all of      required disclosure are subject to a          charitable trust that is not filing Form
the owners or beneficiaries are                nondisclosure penalty of $100 for each        1041.
corporations (looking through any              day the failure continues with a              • Complete the required preparer
partners or beneficiaries that are             maximum penalty for any one                   information.
themselves partners or trusts), the            disclosure of $50,000.                        • Give a copy of the return to the
minimum fee is $250,000. For all                   Also, if the IRS makes a written          organization.
others, the minimum fee is $50,000.            demand on any entity subject to this              Leave the paid preparer’s space
The minimum fee includes all fees paid         penalty, giving the entity a reasonable       blank if the return was prepared by a
directly or indirectly for the tax strategy,   date to make the disclosure and the           regular employee of the filing
advice or analysis of the transaction          entity fails to make disclosure by that       organization.
(whether or not related to the tax             date, the entity is subject to a penalty of   Recordkeeping. The organization’s
consequences of the transaction),              $100 for each day after the date              records should be kept for as long as
implementation and documentation of            specified by the IRS until disclosure is      they may be needed for the
the transaction, and tax preparation           made (with a maximum penalty for any          administration of any provision of the
fees to the extent they exceed                 one disclosure of $10,000). See               Internal Revenue Code. Usually,
customary return preparation fees.             Instructions for Form 8886-T for more         records that support an item of income,
Fees do not include amounts paid to a          information.                                  deduction, or credit must be kept for 3
person, including an advisor, in that                                                        years from the date the return is due or
person’s capacity as a party to the            Excise Tax on Entity Managers
                                               Section 4965(a)(2) imposes an excise          filed, whichever is later. Keep records
transaction.                                                                                 that verify the organization’s basis in
                                               tax on any tax-exempt entity manager
Transaction with contractual                   who approves or otherwise causes the          property for as long as they are needed
protection. A transaction with                 entity to be a party to a prohibited tax      to figure the basis of the original or
contractual protection is a transaction        shelter transaction and knows (or has         replacement property.
for which a participant (or related party      reason to know) that the transaction is           The organization should also keep
as defined under section 267(b) or             a prohibited tax shelter transaction. The     copies of any returns it has filed. They
707(b)) has the right to a full refund or      excise tax, in the amount of $20,000, is      help in preparing future returns and in
partial refund of fees if all or part of the   assessed for each approval or other act       making computations when filing an
intended tax consequences from the             causing the organization to be a party        amended return.
transaction are not sustained. It also         to the prohibited tax shelter transaction.    Rounding off to whole dollars. The
includes a transaction for which fees          To report this tax, file Form 4720.           organization may round off cents to
are contingent on the realization of tax                                                     whole dollars on the return and
benefits from the transaction. For                                                           schedules. If the organization does
exceptions and other details, see              X. Requirements for a                         round to whole dollars, it must round all
Regulations section 1.6011-4(b)(4) and         Properly Completed Form                       amounts. To round, drop amounts
Rev. Proc. 2007-20, 2007-7 I.R.B. 517.
                                               990 or Form 990-EZ                            under 50 cents and increase amounts
Entity-Level Excise Tax                                                                      from 50 to 99 cents to the next dollar.
                                               Public inspection. In general, all            For example, $1.39 becomes $1 and
For Form 990 and 990-EZ filers, section        information the organization reports on       $2.50 becomes $3.
4965(a)(1) imposes an entity level             or with its Form 990, or Form 990-EZ,
excise tax for each taxable year that          including attachments, will be available          If the organization has to add two or
the tax-exempt entity is a party to a          for public inspection. Note, however,         more amounts to figure the amount to
prohibited tax shelter transaction and         the public inspection rules for the           enter on a line, include cents when
has net income or proceeds attributable        Schedule B (Form 990, 990-EZ, or              adding the amounts and round off only
to the transaction which are properly          990-PF), a required attachment for            the total.
allocable to that taxable year. The            organizations that file Form 990 or           Completing all lines. Unless the
amount of the excise tax depends on            Form 990-EZ. Make sure the forms and          organization is permitted to use certain
whether the tax-exempt entity knew or          attachments are clear enough to               DOL forms or Form 5500 as partial
had reason to know that the transaction        photocopy legibly.                            substitutes for Form 990, or Form
was a prohibited tax shelter transaction       Signature. To make the return                 990-EZ (see General Instruction F), do
at the time it became a party to the           complete, an officer of the organization      not leave any applicable lines blank or
transaction.                                   authorized to sign it must sign in the        attach any other forms or schedules
                                               space provided. For a corporation, or         instead of entering the required
   To figure and report the excise tax                                                       information on the appropriate line on
imposed on a tax-exempt entity for             association, this officer may be the
                                               president, vice president, treasurer,         Form 990 or Form 990-EZ.
being a party to a prohibited tax shelter
transaction, file Form 4720.                   assistant treasurer, chief accounting             Some parts of the Form 990 (for
                                               officer, or other corporate or association    example, Line 51 or Line 75) require
  For more information about this              officer, such as a tax officer. A receiver,   the organization to acquire information
excise tax including information about         trustee, or assignee must sign any            from certain persons regarding their
                                                                  -22-         General Instructions for Form 990 and Form 990-EZ
relationships with each other and with        Assembling Form 990 or Form                     needed. If the organization uses
other organizations. The organization is      990-EZ. Before filing the Form 990, or          attachments, the attachments must:
not required to provide information           Form 990-EZ, assemble the package of               1. Show the form number and tax
about such business relationships if it is    forms and attachments in the following          year;
unable to secure the information after        order:
making a reasonable effort to obtain it;      • Form 990 or Form 990-EZ.                        2. Show the organization’s name
                                                                                              and EIN;
in such case, the organization shall (in      • Schedule A (Form 990 or 990-EZ).
response to the question) report the          The requirement to attach Schedule A               3. Identify clearly the Part or line(s)
efforts undertaken. An example of a           (Form 990 or 990-EZ) applies to all             to which the attachments relate;
reasonable effort is for the Form 990         section 501(c)(3) organizations and all
preparer or an officer eligible to sign the                                                      4. Include the information required
                                              section 4947(a)(1) nonexempt                    by the form and use the same format
Form 990 to distribute a questionnaire
                                              charitable trusts that file Form 990 or         as the form;
annually to each officer, director,
                                              Form 990-EZ.
trustee, and key employee listed in Part
V-A; each highest compensated                 • Schedule B (Form 990, 990-EZ, or                 5. Follow the same Part and line
                                              990-PF).                                        sequence as the form; and
employee listed in Schedule A, Part I;
and each highest compensated                  • Attachments to Form 990 or Form                  6. Be on the same size paper as the
professional and other independent            990-EZ.                                         form.
contractor listed in Schedule A, Parts        • Attachments to Schedule A (Form
II-A and II-B. The questionnaire should       990 or 990-EZ).
require the name and title, date, and         • Attachments to Schedule B (Form
signature of each person reporting this       990, 990-EZ, or 990-PF).
information. The questionnaire should
contain the pertinent definitions set out     Attachments. Use the schedules on
in the instructions.                          the official form unless more space is


                          Checklist for a Properly Completed Return


                      Complete Schedule A (Form 990 or 990-EZ) if the organization is a section 501(c)(3), 501(e), (f), (k), or (n)
                      organization or a section 4947(a)(1) nonexempt charitable trust.

                      Complete Schedule A (Form 990 or 990-EZ), Part IV-A, Support Schedule, if the organization is required to
                      check a box on line 10, 11a, 11b, or 12 of Part IV of Schedule A.

                      File Form 990 instead of Form 990-EZ if the organization’s gross receipts are $100,000 or more or total assets
                      at the end of the year are $250,000 or more, or the organization is a sponsoring organization, or controlling
                      organization under section 512(b)(13).

                      Indicate the correct tax year in the heading of the form.

                      Have an officer of the organization sign the return.

                      Complete all Balance Sheet columns (Part IV (and IV-A and IV-B) of Form 990; Part II of Form 990-EZ).
                      Indicate “N/A” if a line, column, or Part does not apply. Indicate too, on the applicable line, if a schedule is
                      attached. Do not substitute another balance sheet instead of completing the Part II Balance Sheet of Form
                      990-EZ.

                      Attach all required pages and schedules to the return. Include a list of subordinates if filing a group return.

                      Double-check the accuracy of the organization’s EIN, tax period, and group exemption number (GEN), if
                      applicable.

                      Indicate the correct 501(c) subsection under which the organization is tax-exempt. If there has been a change,
                      attach a copy of the latest determination letter. If the letter is unavailable, attach a description of the
                      organization’s primary exempt purpose.

                      Be aware that the Form 990, Form 990-EZ, the Schedule A (Form 990 or 990-EZ), and the attachments to be
                      filed with these forms, are publicly disclosable. Note, however, the specific public inspection rules in the
                      Instructions for Schedule B (Form 990, 990-EZ, or 990-PF).




General Instructions for Form 990 and Form 990-EZ                 -23-
                                 Section 501(c)(3) organizations required to complete lines 26, 27, or 28 of Schedule A (Form 990 or 990-EZ)
                                 must prepare lists for their own records to substantiate amounts on those lines. These lists are not to be filed
                                 with the return.

                                 Do not check the Termination box in the heading of the Form 990 or 990-EZ unless the organization has
                                 ceased operations.




                                                                  or if this is the first time the organization       the third party’s name and street
                                                                  is filing either a Form 990 or a Form               address or P.O. box.
Specific Instructions for                                         990-EZ.                                                Include the suite, room, or other unit
                                                                    If the tax-exempt organization has                number after the street address. If the
Form 990                                                          changed its name, attach the following              Post Office does not deliver mail to the
See also the General Instructions that                            documents:                                          street address and the organization has
apply to both Form 990 and Form                                                                                       a P.O. box, show the box number
990-EZ.                                                           IF the                                              instead of the street address.
                                                                  organization is .   THEN attach . . .                  For foreign addresses, enter
Contents                                                 Page
Completing the Heading of Form 990 . . . . .                 24                                                       information in the following order: city,
                                                                  A corporation       Amendments to the articles of
                                                                                      incorporation with proof of     province or state, and the name of the
Part I — Revenue, Expenses, and Changes in                                                                            country. Follow the foreign country’s
Net Assets or Fund Balances . . . . . . . . . .              25                       filing with the state of
                                                                                      incorporation.                  practice in placing the postal code in
Part II — Statement of Functional Expenses                   32                                                       the address. Please do not abbreviate
Part III — Statement of Program Service                           A trust             Amendments to the trust         the country name.
Accomplishments . . . . . . . . . . . . . . . . . .          36                       agreement signed by the
                                                                                      trustee.                           If a change in address occurs after
Part IV — Balance Sheets . . . . . . . . . . . . .           36                                                       the return is filed, use Form 8822 to
Parts IV-A and IV-B — Reconciliation                              An association      Amendments to the articles of   notify the IRS of the new address.
Statements . . . . . . . . . . . . . . . . . . . . . .       40                       association, constitution,
                                                                                      bylaws, or other organizing     Item D. Employer Identification
Part V-A — Current Officers, Directors,
Trustees, and Key Employees . . . . . . . . . .              40
                                                                                      document, with the signatures   Number
                                                                                      of at least two officers/
Part V-B — Former Officers, Directors,                                                members.
                                                                                                                      The organization should have only one
Trustees, and Key Employees That Received                                                                             federal employer identification number
Compensation or Other Benefits . . . . . . . .               42                                                       (EIN). If it has more than one and has
                                                                  Final return and Amended return.                    not been advised which to use, notify
Part VI — Other Information . . . . . . . . . . . .          43
                                                                  Organizations should file final returns             the:
Part VII — Analysis of Income-Producing                           when they cease to be section 501(a)
Activities . . . . . . . . . . . . . . . . . . . . . . . .   50   organizations or section 527                             Department of the Treasury
Part VIII — Relationship of Activities to the                     organizations; for example, when they                    Internal Revenue Service Center
Accomplishment of Exempt Purposes . . . . .                  51   cease operations and dissolve. See the                   Ogden, UT 84201-0027
Part IX — Information Regarding Taxable                           instructions for line 79 that discuss               State what numbers the organization
Subsidiaries and Disregarded Entities . . . . .              52   liquidations, dissolutions, terminations,           has, the name and address to which
Part X — Information Regarding Transfers                          or substantial contractions.                        each number was assigned, and the
Associated With Personal Benefit Contracts                   52
                                                                     If the return is an amended return,              address of its principal office. The IRS
Part XI — Information Regarding Transfers to                      check the box. There are amended                    will advise the organization which
and From Controlled Entities . . . . . . . . . . .           52   return requirements when filing with a              number to use.
Exclusion Codes . . . . . . . . . . . . . . . . . . .        53   state. See General Instructions E and               • A section 501(c)(9) voluntary
                                                                  J.                                                  employees’ beneficiary association
                                                                  Application pending. If the                         must use its own EIN and not the EIN
Completing the Heading of                                         organization’s application for exemption            of its sponsor.
Form 990                                                          is pending, check this box and                      • A disregarded entity, as described in
                                                                  complete the return.                                Regulations sections 301.7701-1
The instructions that follow are keyed to                                                                             through 301.7701-3, however, may use
items in the heading for Form 990.                                Item C. Name and Address                            the EIN of the organization in Part IX if
Item A. Accounting Period                                         If the organization operates under a                the disregarded entity does not have its
                                                                  name different from its legal name, give            own EIN. See General Instruction A
File the 2007 return for calendar year                                                                                and the instructions for Part IX.
2007 and fiscal years that begin in                               the legal name of the organization but
2007 and end in 2008. For a fiscal year                           identify its alternate name, after the              Item E. Telephone Number
return, fill in the tax year space at the                         legal name, by writing “aka” (also                  Enter a telephone number of the
top of page 1. See General Instruction                            known as) and the alternate name of                 organization that members of the public
G for additional information on                                   the organization. However, if the                   and government regulators may use
accounting periods and methods.                                   organization has changed its name,                  during normal business hours to obtain
                                                                  follow the instructions for Name change             information about the organization’s
Item B. Checkboxes                                                in Item B — Checkboxes.                             finances and activities. If the
Address change, name change, and                                     If the organization receives its mail in         organization does not have a telephone
initial return. Check the appropriate                             care of a third party (such as an                   number, enter the telephone number of
box if the organization changed its                               accountant or an attorney), enter on the            an organization official who can provide
address since it filed its previous return,                       street address line “C/O” followed by               such information.
                                                                                         -24-                              Specific Instructions for Form 990
Item F. Accounting Method                    501(c)(15) Organizations in General                     If . . . . . . . A section 501(c)(7), (8), or (10)
                                             Instruction A. Do not use the section                                    organization did not receive any
An organization must indicate the                                                                                     contribution or bequest for use
method of accounting used in preparing       501(c)(15) definition of gross receipts to
                                             figure if the organization’s gross                                       exclusively for religious,
this return. See General Instruction G.                                                                               charitable, scientific, literary, or
                                             receipts are normally $25,000 or less.                                   educational purposes, or the
Item G. Website                                                                                                       prevention of cruelty to children or
Show the organization’s website              Item L. Figuring Gross Receipts                                          animals (and did not receive any
address if a website is available.                                                                                    noncharitable contributions of
Otherwise, write “N/A” (not applicable).     The organization’s gross receipts are                                    $5,000 or more as described
Consider adding the organization’s           the total amount it received from all                                    below under general rule),
email address to its website.                sources during its annual accounting
                                                                                                     Then . . . . The organization should check the
                                             period, without subtracting any costs or                             box in item M to certify that it is
Item H. Group Return, etc.                   expenses. See the gross receipts                                     not required to attach Schedule B
See General Instruction R. Attach the        discussion in General Instruction B.                                 (Form 990, 990-EZ, or 990-PF).
required list, if applicable, or the                                                                 Otherwise Complete and attach Schedule B
organization will be contacted later for              To figure if a section 501(c)(15)                        (Form 990, 990-EZ, or 990-PF).
the missing information.                        !     organization qualifies for tax
                                              CAUTION exemption for the year, see the
                                                                                                          All Other Form 990 or Form 990-EZ
Item I. Group Exemption                      definition of gross receipts for section
                                                                                                              Organizations (General rule)
Number                                       501(c)(15) purposes under Section                       If . . . . . . . The organization did not show as
The group exemption number (GEN) is          501(c)(15) Organizations in General                                      part of line 1e of the Form 990, a
a number assigned by the IRS to the          Instruction A. Do not use the section                                    contribution of $5,000 or more
central/parent organization of a group       501(c)(15) definition of gross receipts to                               from any one contributor,*
that has a group ruling.                     figure the amount to enter here.                        Then . . . . The organization should check the
   Enter the four-digit group exemption                                                                           box in item M to certify that it is
number if “Yes” was checked in item                                                                               not required to attach Schedule B
                                             Item M. Schedule B (Form 990,                                        (Form 990, 990-EZ, or 990-PF).
H(a) and H(d). Contact the central/          990-EZ, or 990-PF)
parent organization if the organization                                                              Otherwise Complete and attach Schedule B
is unsure of the GEN assigned.               Whether or not the organization enters                            (Form 990, 990-EZ, or 990-PF).
                                             any amount on line 1e of Form 990, the                  * Total a contributor’s gifts of $1,000 or more to
Item J. Organization Type                    organization must either check the box                  determine if a contributor gave $5,000 or more. Do
                                             in item M or attach Schedule B (Form                    not include smaller gifts.
If the organization is exempt under
section 501(c), check the applicable         990, 990-EZ, or 990-PF). The
box and insert, within the parentheses,      organization return will be incomplete if
the number that identifies the type of       it does not either check the box in item                Part I. Revenue, Expenses,
section 501(c) organization the filer is.    M or file Schedule B (Form 990,
                                             990-EZ, or 990-PF). See the                             and Changes in Net Assets
See the chart in General Instruction C.
The term section 501(c)(3) includes          Instructions for Schedule B (Form 990,                  or Fund Balances
organizations exempt under sections          990-EZ, or 990-PF), for more                            All organizations filing Form 990 with
501(e), (f), (k), and (n). Check the         information.                                            the IRS or any state must complete
applicable box if the organization is a                                                              Part I. Some states that accept Form
section 527 political organization. See               Contributor includes individuals,              990 in place of their own forms require
General Instruction U.                        TIP fiduciaries, partnerships,                         additional information.
    If the organization is a section                 corporations, associations,
4947(a)(1) nonexempt charitable trust,       trusts, and exempt organizations.                       Line 1. In General
check the applicable box. Note also the
discussion regarding Schedule A (Form                                                                Contributions, Gifts, Grants,
990 or 990-EZ) and Form 1041 in                                                                      and Similar Amounts Received
General Instruction D and the                    Guidelines for Meeting the                          • Report the amount contributed to
instructions to line 92 of Form 990.           Requirements for Schedule B                           donor advised funds on line 1a.
Item K. Gross Receipts of                      (Form 990, 990-EZ, or 990-PF)                         • On lines 1b through 1d, report
$25,000 or Less                                                                                      amounts received as voluntary
                                                 Section 501(c)(3) org. meeting the 1/3
                                                      support test of 170(b)(1)(A)
                                                                                                     contributions (other than contributions
Check this box if the organization is not                                                            to donor advised funds; that is,
a section 509(a)(3) supporting                                                                       payments, or the part of any payment,
                                             If . . . . . . . A section 501(c)(3) organization
organization and its gross receipts are                       that met the 1/3 support test of the   for which the payer (donor) does not
normally not more than $25,000, but                           regulations under 509(a)(1)/           receive full retail value (fair market
the organization chooses to file Form                         170(b)(1)(A) did not receive a         value) from the recipient (donee)
990. If the organization chooses to file                      contribution of the greater of         organization.
Form 990, be sure to file a complete                          $5,000 or 2% of the amount on          • Report gross amounts of
return. For a discussion on gross                             line 1e of Form 990, from any one
                                                                                                     contributions collected in the charity’s
receipts for this purpose, see General                        contributor,*
                                                                                                     name by fundraisers.
Instruction B. Also, see General
Instruction X for a discussion on a
                                             Then . . . . The organization should check the
                                                          box in item M to certify that it is
                                                                                                     • Report all expenses of raising
complete return.                                          not required to attach Schedule B
                                                                                                     contributions in Fundraising, column
                                                          (Form 990, 990-EZ, or 990-PF).             (D), Part II, and on line 15 of Part I. The
         To figure if a section 501(c)(15)                                                           organization must show on line 30
  !      organization qualifies for tax
CAUTION exemption for the year, see the
                                             Otherwise Complete and attach Schedule B
                                                       (Form 990, 990-EZ, or 990-PF).
                                                                                                     professional fundraising fees relating to
                                                                                                     the gross amounts of contributions
definition of gross receipts for section      Section 501(c)(7), (8), or (10) Organization           collected in the charity’s name by
501(c)(15) purposes under Section                                                                    fundraisers.
Specific Instructions for Form 990                                  -25-
• Report the value of noncash                 67-246, 1967-2 C.B. 104, explains this        Donations of Services and the
contributions at the time of the              principle in detail. See also the Lines 9a    Use of Property Are Not
donation. For example, report the gross       through 9c instructions and Pub. 526.         Contributions
value of a donated car at the time the
                                                  Report the expenses that relate           In Part I, do not include as contributions
car was received as a donation.
                                              directly to the sale of the book on line
• For grants, see Grants That Are             9b. Report the expenses of raising
                                                                                            on line 1 the value of services donated
Equivalent to Contributions, on the                                                         to the organization, or items such as
                                              contributions (shown within the               the free use of materials, equipment, or
following page.
                                              parentheses on line 9a and again on           facilities. See the instructions for Part III
    Reporting for line 1, in accordance       line 1b) in Fundraising, column (D), Part     and for Part VI, line 82, for the optional
with SFAS 116, is acceptable for Form         II, and on line 15 of Part I.                 reporting of such amounts in Parts III
990 purposes, but not required by IRS.                                                      and VI.
However, see General Instruction E.                    At the time of any solicitation or
    An organization that receives a grant       !      payment, organizations that are
                                               CAUTION eligible to receive tax-deductible
                                                                                                Any unreimbursed expenses of
to be paid in future years should,                                                          officers, employees, or volunteers do
                                              contributions should advise patrons of        not belong on the Form 990 or Form
according to SFAS 116, report the             the amount deductible for federal tax
grant’s present value on line 1.                                                            990-EZ. See the discussions for
                                              purposes. See General Instruction L.          charitable contributions and employee
Accruals of present value increments to
the unpaid grant should also be                                                             business expenses in Pub. 526 and
                                              Contributions Can Arise From                  Pub. 463, respectively.
reported on line 1 in future years.           Special Events When Items of
Contributions Can Arise From                  Only Nominal Value Are Given                  Grants That Are Equivalent to
Special Events When an Excess                 or Offered                                    Contributions
Payment Is Received for Items                 If an organization offers goods or            Grants that encourage an organization
Offered                                       services of only nominal value through        receiving the grant to carry on
                                              a special event or distributes free,          programs or activities that further its
Fundraising activities relate to soliciting
                                              unordered, low-cost items to patrons,         exempt purposes are grants that are
and receiving contributions. However,
                                              report the entire amount received for         equivalent to contributions. Report them
special fundraising activities such as
                                              such benefits as a contribution on line       on line 1. The grantor may require that
dinners, door-to-door sales of
                                              1b (direct public support). Report all        the programs of the grant recipient
merchandise, carnivals, and bingo
                                              related expenses in Fundraising,              (grantee) conform to the grantor’s own
games can produce both contributions
                                              column (D), Part II. See General              policies and may specify the use of the
and revenue.
                                              Instruction L for a definition of benefits    grant, such as use for the restoration of
    If a buyer at such a special event        that have a nominal or insubstantial          a historic building or a voter registration
pays more for goods or services than          value.                                        drive.
their retail value, report, as a
contribution, both on line 1b and on line     Section 501(c)(3) Organizations                   A grant is still equivalent to a
9a (within the parentheses), any              Correctly dividing gross receipts from        contribution if the grant recipient
amount paid in excess of the retail           special events into revenue and               provides a service or makes a product
value. This situation usually occurs          contributions is especially important for     that benefits the grantor incidentally.
when organizations seek public support        a section 501(c)(3) organization that         See Examples in the line 1d
through solicitation programs that are in     claims public support as described in         instructions. However, a grant is a
part special events or activities and are     section 509(a)(1)/170(b)(1)(A)(vi) or         payment for services, and not a
in part solicitations for contributions.      section 509(a)(2). In the public support      contribution, if the grant requires the
The primary purpose of such                   computations of these Code sections,          grant recipient to provide that grantor
solicitations is to receive contributions     the revenue portion of gross receipts         with a specific service, facility, or
and not to sell the merchandise at its        may be (a) excluded entirely, (b)             product rather than to give a direct
retail value even though this might           treated as public support, or (c) if the      benefit primarily to the general public or
produce a profit.                             revenue represents unrelated trade or         to that part of the public served by the
    Example. An organization                  business income, treated as nonpublic         organization. In general, do not report
announces that anyone who contributes         support.                                      as contributions any payments for a
at least $40 to the organization can                                                        service, facility, or product that primarily
                                                 Section 501(c)(3) organizations must
choose to receive a book worth $16                                                          give some economic or physical benefit
                                              separate gross receipts from special
retail value. A person who gives $40,                                                       to the payer (grantor).
                                              events into revenue and contributions
and who chooses the book, is really           when preparing the Support Schedule              Example. A public interest
purchasing the book for $16 and also          in Part IV-A of Schedule A (Form 990          organization described in section
making a contribution of $24. The             or 990-EZ).                                   501(c)(4) makes a grant to another
contribution of $24, which is the                                                           organization to conduct a nationwide
difference between the buyer’s                Section 501(c)(9), (17), and (18)             survey to determine voter attitudes on
payment and the $16 retail value of the       Organizations                                 issues of interest to the grantor. The
book, would be reported on line 1b and        These organizations provide                   grantor plans to use the results of the
again on line 9a (within the                  participants with life, sickness, accident,   survey to plan its own program for the
parentheses). The revenue received            welfare, and unemployment insurance,          next 3 years. Under these
($16 retail value of the book) would be       pensions, or similar benefits, or a           circumstances, since the survey serves
reported in the right-hand column on          combination of these benefits. When           the grantor’s direct needs and benefits
line 9a.                                      such an organization receives                 the grantor more than incidentally, the
    If a contributor gives more than $40,     payments from participants or their           grant to the organization making the
that person would be making a larger          employers to provide these benefits,          survey is not a contribution. The grant
contribution, the difference between the      report the payments on line 2 as              recipient should not report the grant as
book’s retail value of $16 and the            program service revenue, rather than          a contribution but should report it on
amount actually given. Rev. Rul.              on line 1 as contributions.                   line 2 as program service revenue.
                                                                 -26-                             Specific Instructions for Form 990
   Treat research to develop products            c. All grants from the fund or           donee’s name in a sales promotion
for the payer’s use or benefit as directly   account are awarded on an objective          campaign. In such a campaign, the
serving the payer. However, generally,       and nondiscriminatory basis according        donor advertises that it will contribute a
basic research or studies in the             to a procedure approved in advance by        certain dollar amount to the donee
physical or social sciences should not       the board of directors of the sponsoring     organization for each unit of a particular
be treated as serving the payer’s            organization. The procedure must be          product or service sold or for each
needs.                                       designed to ensure that all grants meet      occurrence of a specific type.
                                             the requirements of sections                 Contributions received through
   See Regulations section
                                             4945(g)(1), (2), or (3).                     special events. Report contributions
1.509(a)-3(g) to determine if a grant is
a contribution reportable on line 1b or a                                                 received through special events on line
revenue item reportable elsewhere on         Line 1b. Direct Public Support               1b. See the preceding line 1
Form 990.                                    Contributions, gifts, grants, and            instructions and the instructions for
                                             similar amounts received. Enter the          Lines 9a through 9c.
Line 1a. Contributions to Donor              gross amounts of contributions, gifts,       Line 1c. Indirect Public Support
Advised Funds                                grants, and bequests that the                Enter the total contributions received
Complete line 1a only if the                 organization received directly from the      indirectly from the public through
organization is a sponsoring                 public. Do not include any amounts           solicitation campaigns conducted by
organization that maintains one or more      previously reported on line 1a on this       federated fundraising agencies and
donor advised funds. Enter the gross         line. Include:                               similar fundraising organizations (such
amounts of contributions, gifts, grants,     • All donated items. For example, a car      as a United Way organization and
and bequests received for all donor          is donated to an organization.               certain sectarian federations). These
advised funds the organization               Immediately after the organization           organizations normally conduct
maintains.                                   receives the donated car, the                fundraising campaigns within a single
                                             organization sells the car. The              metropolitan area or some part of a
   A sponsoring organization is any          organization includes the value of the
organization which:                                                                       particular state and allocate part of the
                                             car as of the time of its receipt as a
• Is described in section 170(c), except     contribution on line 1b and includes it in
                                                                                          net proceeds to each participating
for governmental entities described in                                                    organization on the basis of the donors’
                                             the total on line 1e as a noncash            individual designations and other
section 170(c)(1),                           contribution.
• Is not a private foundation as defined     • All funds or the entire value of           factors.
in section 509(a), and                       noncash items raised by an outside              Include on line 1c amounts
• Maintains one or more donor advised        fundraiser in a charity’s name and not       contributed by other organizations
funds.                                       just the amount actually received by the     closely associated with the reporting
   In general, a donor advised fund is a     charity. For example, a corporation          organization. This includes
fund or account:                             solicits and sells cars in a charity’s       contributions received from a parent
                                             name. When a car is received, its entire     organization, subordinate, or another
   1. Which is separately identified by                                                   organization with the same parent.
reference to contributions of a donor or     value is reported as a contribution.
donors;                                      • Amounts received from individuals,         National organizations that share in
                                             trusts, corporations, estates, and           fundraising campaigns conducted by
   2. Which is owned and controlled by                                                    their local affiliates should report the
a sponsoring organization; and               foundations, or raised by an outside
                                             professional fundraiser.                     amount they receive on line 1c.
   3. For which the donor (or any
person appointed or designated by the        • Contributions and grants from public          Do not include any amounts
donor) has or expects to have advisory       charities and other exempt                   previously reported on line 1a on this
privileges concerning the distribution or    organizations that are neither               line.
investment of amounts held in the            fundraising organizations nor affiliates
                                             of the filing organization.                  Line 1d. Government
donor advised funds or accounts
because of the donor’s status as a           • See the instructions for line 1c.          Contributions (Grants)
donor.                                       Membership dues. Report on line 1b           The general line 1 instructions, under
                                             membership dues and assessments              the heading, Grants That Are
Exception. A donor advised fund              that represent contributions from the        Equivalent to Contributions, earlier,
does not include:                            public rather than payments for benefits     apply to this item in particular. A grant
                                             received or payments from affiliated         or other payment from a governmental
    1. Any fund or account that makes                                                     unit is treated as a contribution if its
distributions only to a single identified    organizations. See the instructions for
                                             line 3.                                      primary purpose is to enable the donee
organization or governmental entity, or                                                   to provide a service to, or maintain a
    2. Any fund or account for a person      Government contributions (grants).
                                                                                          facility for, the direct benefit of the
described in 3 above that gives advice       Report government grants on line 1d if
                                                                                          public rather than to serve the direct
about which individuals receive grants       they represent contributions, or on line
                                                                                          and immediate needs of the grantor
for travel, study, or other similar          2 (and on line 93(g) of Part VII), if they
                                                                                          even if the public pays part of the
purposes, if:                                represent fees for services. See the
                                                                                          expense of providing the service or
    a. The person’s advisory privileges      instructions under the heading, Grants
                                                                                          facility.
are performed exclusively by such            That Are Equivalent to Contributions,
                                             earlier and the instructions for line 1d         The following are examples of
person in their capacity as a committee
                                             later.                                       governmental grants and other
member of which all of the committee
                                                                                          payments that are treated as
members are appointed by the                 Commercial co-venture. Report
                                                                                          contributions.
sponsoring organization.                     amounts contributed by a commercial
    b. No combination of persons with        co-venture on line 1b as a contribution          Examples.
advisory privileges described in 3           received directly from the public. These         1. Payments by a governmental unit
above, or persons related to those in 3      are amounts received by an                   for the construction or maintenance of
above, directly or indirectly control the    organization (donee) for allowing an         library or hospital facilities open to the
committee.                                   outside organization (donor) to use the      public.
Specific Instructions for Form 990                             -27-
    2. Payments under government             Lines 2 through 11                            participants, for health and welfare
programs to nursing homes or homes                                                         benefits coverage; insurance premiums
for the aged in order to provide health               Do not enter any contributions       received by a fraternal beneficiary
care or other services to their residents.     !      on lines 2 through 11. Enter all
                                              CAUTION contributions on line 1. If the
                                                                                           society; and registration fees received
                                                                                           in connection with a meeting or
    3. Payments to child placement or
child guidance organizations under           organization enters contributions on          convention.
government programs serving children         lines 2 through 11, it will be unable to      Program-related investments.
in the community. The general public         complete Part VII correctly. Line 105         Program service revenue also includes
gets the primary and direct benefit from     (the sum of amounts entered in                income from program-related
these payments and any benefit to the        columns (B), (D), and (E) for lines 93        investments. These investments are
governmental unit itself would be            through 103 of Part VII, Analysis of          made primarily to accomplish an
indirect and insubstantial as compared       Income-Producing Activities) should           exempt purpose of the investing
to the public benefit.                       match the total of amounts entered for        organization rather than to produce
                                             correlating lines 2 through 11 of Part I.     income. Examples are scholarship
                                             See the instructions for Part VII.            loans and low interest loans to
   Do not include any amounts                Line 2. Program Service                       charitable organizations, indigents, or
previously reported on line 1a on this                                                     victims of a disaster.
line.
                                             Revenue Including Medicare,
                                             Medicaid Payments and                            Rental income from an exempt
                                                                                           function is another example of
                                             Government Fees and                           program-related investment income.
Line 1e. Total Contributions,                Contracts
etc.                                                                                       When an organization rents to an
                                             Enter the total of program service            unaffiliated exempt organization at less
Enter the total of amounts reported on       revenue (exempt function income) as           than fair rental value for the purpose of
lines 1a through 1d. In the entry spaces     reported in Part VII, lines 93(a) through     aiding that tenant’s exempt function,
in the description column for line 1e,       (g), columns (B), (D), and (E). Program       the reporting organization should report
enter the separate totals for cash and       services are primarily those that form        such rental income as program service
noncash contributions, gifts, grants, and    the basis of an organization’s                revenue on line 2. See also the
similar amounts received. The total of       exemption from tax. For a more                instructions for line 6a. For purposes of
the two amounts must equal the total         detailed description of program               this return, report all rental income from
on line 1e.                                  services, refer to the instructions for       an affiliated organization on line 2.
                                             Part II, column (B), Program services.        Unrelated trade or business
   Report as cash contributions, only            Example. A hospital would report          activities. Unrelated trade or business
contributions received in the form of        on this line all of its charges for medical   activities (not including any special
cash, checks, money orders, credit card      services (whether to be paid directly by      events or activities) that generate fees
charges, wire transfers, and other           the patients or through Medicare,             for services may also be program
transfers and deposits to a cash             Medicaid, or other third-party                service activities. A social club, for
account of the organization. If the          reimbursement), hospital parking lot          example, should report as program
organization records pledges as              fees, room charges, laboratory fees for       service revenue the fees it charges
contributions, at the time the pledges       hospital patients, and related charges        both members and nonmembers for the
are made (rather than when the               for services.                                 use of its tennis courts and golf course.
pledges are collected), include as cash          Insurance premiums. A section             Sales of inventory items by
contributions, only those pledges            501(c)(15) organization would report on       hospitals, colleges, and universities.
actually collected in cash during the        this line all of its insurance premiums       Books and records maintained in
year and pledges uncollected at the          received. The amount reported here for        accordance with generally accepted
end of the year that are reasonably          insurance premiums should correlate           accounting principles for hospitals,
expected to be paid in cash in a later       with the amounts reported on line 93,         colleges, and universities are more
year.                                        columns (B), (D), and (E).                    specialized than books and records
                                             Program service revenue. Program              maintained according to those
    Report all other contributions, as       service revenue includes income               accounting principles for other types of
noncash contributions in the space           earned by the organization for providing      organizations that file Form 990.
provided. Be sure to include as a            a government agency with a service,           Accordingly, hospitals, colleges, and
noncash contribution donated items like      facility, or product that benefited that      universities may report, as program
cars and clothing valued as of the time      government agency directly rather than        service revenue on line 2, sales of
of their receipt even if these items were    benefiting the public as a whole. See         inventory items otherwise reportable on
made available for sale immediately          the line 1d instructions for reporting        line 10a. In that event, show the
after they were received. See General        guidelines when payments are received         applicable cost of goods sold as
Instruction L and Schedule B (Form           from a government agency for providing        program service expense on line 13 of
990, 990-EZ, or 990-PF), and the             a service, facility, or product for the       Part I and in column (B) of Part II. All
instructions for lines 1 and 1b for a        primary benefit of the general public.        other organizations, however, should
discussion of noncash contributions.             Program service revenue also              not report sales of inventory items on
Noncash contributions do not include         includes: tuition received by a school;       line 2.
donated services, which may be               revenue from admissions to a concert
reported on line 82 and in the narrative                                                   Line 3. Membership Dues and
                                             or other performing arts event or to a
section of Part III.                         museum; royalties received as author
                                                                                           Assessments
                                             of an educational publication distributed     Enter members’ and affiliates’ dues and
Schedule of Contributors. Attach             by a commercial publisher; interest           assessments that are not contributions.
Schedule B (Form 990, 990-EZ, or             income on loans a credit union makes          Dues and assessments received that
990-PF). See General Instruction L and       to its members; payments received by a        compare reasonably with available
the Specific Instructions for Completing     section 501(c)(9) organization from           benefits. When dues and
the Heading of Form 990, Item M.             participants, or employers of                 assessments are received that
                                                                -28-                            Specific Instructions for Form 990
compare reasonably with membership            Line 6a. Gross Rents                         assets (such as program-related
benefits received, report such dues and       Enter on line 6a the rental income           investments and fixed assets used by
assessments on line 3.                        received for the year from investment        the organization in its related and
                                              property reportable on line 55. Do not       unrelated activities).
   Organizations described in section
501(c)(5), (6), or (7) generally provide      include on line 6a rental income related         On line 8a, for each column, enter
benefits that have a reasonable               to the reporting organization’s exempt       the total gross sales price of all such
relationship to dues, although benefits       function (program service). Report such      assets. Total the cost or other basis
to members may be indirect.                   income on line 2. For example, an            (less depreciation) and selling
                                              exempt organization whose exempt             expenses and enter the result on line
Dues or assessments received that             purpose is to provide low-rental housing     8b. On line 8c, enter the net gain or
exceed the value of available                 to persons with low income would             loss.
membership benefits. Whether or               report that rental income as program             On lines 8a and 8c, also report
not membership benefits are used,             service revenue on line 2. Rental            capital gains dividends, the
dues received by an organization, to          income received from an unaffiliated         organization’s share of capital gains
the extent they are more than the             exempt organization is generally             and losses from a partnership, and
monetary value of the membership              considered as unrelated to the reporting     capital gains distributions from trusts.
benefits available to the dues payer,         organization’s exempt purpose and            Indicate the source on the schedule
are a contribution that should be             reportable on line 6a. However, note an      described later.
reported on line 1b. See Rev. Rul.            exception given in the instructions for          Combine the gain and/or loss figures
54-565, 1954-2 C.B. 95 and Rev. Rul.          line 2 when the reporting organization       reported on line 8c, columns (A) and
68-432, 1968-2 C.B. 104.                      aids an unaffiliated organization with its   (B) and report that total on line 8d. Do
                                              exempt function.                             not include any unrealized gains or
Dues received primarily for the
organization’s support. If a member               Only for purposes of completing this     losses on securities carried at market
pays dues mainly to support the               return, the reporting organization must      value in the books of account. See the
organization’s activities and not to          report any rental income received from       instructions for line 20.
obtain benefits of more than nominal          an affiliated exempt organization as             For reporting sales of securities on
monetary value, those dues are a              program service revenue on line 2.           Form 990, the organization may use
contribution to the organization              Line 6b. Rental Expenses                     the more convenient average cost basis
includible on line 1b.                        Enter the expenses paid or incurred for      method to figure the organization’s gain
                                              the income reported on line 6a. Include      or loss. When a security is sold,
Examples of membership benefits.                                                           compare its sales price with the
These include subscriptions to                interest related to rental property and
                                              depreciation if it is recorded in the        average cost basis of the particular
publications, newsletters (other than                                                      security to determine gain or loss.
one about the organization’s activities       organization’s books and records.
                                              Report in column (B) of Part II Program      However, generally, for reporting sales
only), free or reduced-rate admissions                                                     of securities on Form 990-T, do not use
to events the organization sponsors,          services any rental expenses allocable
                                              to rental income reportable as program       the average cost basis to determine
the use of its facilities, and discounts on                                                gain or loss.
articles or services that both members        service revenue on line 2.
                                                                                           Nonpublicly traded securities and
and nonmembers can buy. In figuring           Line 6c. Net Rental Income or                noninventory items. Attach a
the value of membership benefits, do          (Loss)                                       schedule showing the sale or exchange
not include intangible benefits, such as
                                              Subtract line 6b from line 6a. Show any      of nonpublicly traded securities and the
the right to attend meetings, vote or
                                              loss in parentheses.                         sale or exchange of other assets that
hold office in the organization, and the
                                                                                           are not inventory items. The schedule
distinction of being a member of the          Line 7. Other Investment                     should show security transactions
organization.                                 Income                                       separately from the sale of other
Line 4. Interest on Savings and               Enter the amount of investment income        assets. Show for each of these assets:
Temporary Cash Investments                    not reportable on lines 4 through 6 and      • Date acquired and how acquired,
                                              describe the type of income in the           • Date sold and to whom sold,
Enter the amount of interest income           space provided or in an attachment.          • Gross sales price,
from savings and temporary cash               The income should be the gross               • Cost, other basis, or if donated, value
investments reportable on line 46.            amount derived from investments              at time acquired (state which),
So-called dividends or earnings               reportable on line 56. Include, for          • Expense of sale and cost of
received from mutual savings banks,           example, royalty income from mineral         improvements made after acquisition,
money market funds, etc., are actually        interests owned by the organization.         and
interest and should be entered on line        However, do not include income from          • If depreciable property, depreciation
4.                                            program-related investments. See the         since acquisition.
                                              instructions for line 2. Also, do not        Publicly traded securities. On the
Line 5. Dividends and Interest                include unrealized gains and losses on       attached schedule, for sales of publicly
from Securities                               investments carried at market value.         traded securities through a broker, total
Enter the amount of dividend and              See the instructions for line 20.            the gross sales price, the cost or other
interest income from equity and debt                                                       basis, and the expenses of sale on all
securities (stocks and bonds) of the
                                              Lines 8a through 8d. Gains (or
                                                                                           such securities sold, and report
type reportable on line 54. Include           Losses) From Sale of Assets                  lump-sum figures in place of the
amounts received from payments on             Other Than Inventory                         detailed reporting required by the above
securities loans, as defined in section       Report, on lines 8a through 8c, all sales    paragraph. Publicly traded securities
512(a)(5). Do not include any capital         of securities in column (A). Use column      include common and preferred stocks,
gains dividends that are reportable on        (B) to report sales of all other types of    bonds (including governmental
line 8. See the instructions for line 2 for   investments (such as real estate,            obligations), and mutual fund shares
reporting income from program-related         royalty interests, or partnership            that are listed and regularly traded in an
investments.                                  interests) and all other noninventory        over-the-counter market or on an
Specific Instructions for Form 990                              -29-
established exchange and for which           amount received that exceeds the retail      and lotteries in which a payment of at
market quotations are published or           value of the goods or services given.        least a specified minimum amount is
otherwise readily available.                     Report on line 9b only the expenses      required for each entry are special
                                             directly attributable to the goods or        events, reportable on line 9, unless the
Lines 9a through 9c. Special                                                              prizes awarded have only nominal
Events and Activities                        services the buyer receives from a
                                             special event. Fundraising expenses          value. Reporting payments in their
On the appropriate line, enter the gross     attributable to contributions, reported on   entirety as contributions when gifts or
revenue, expenses, and net income (or        both line 1b and line 9a (within the         services given are nominal in value is
loss) from all special events and            parentheses), are reportable in Part II,     discussed above.
activities, such as dinners, dances,         column (D), Fundraising. If the              Attached schedule. Attach a
carnivals, raffles, bingo games, other       organization includes an expense on          schedule listing the three largest
gaming activities, and door-to-door          line 9b, do not report it again on line      fundraising events, as measured by
sales of merchandise.                        10b or in Part II. Expenses reported on      gross receipts. If gaming is conducted,
    These activities only incidentally       line 10b relate to sales of inventory.       treat different types of gaming
accomplish an exempt purpose. Their          Expenses reported in Part II, column         separately to determine the three
sole or primary purpose is to raise          (D), relate to contributions raised          largest events. For example, treat bingo
funds that are other than contributions      through fundraising.                         and pull tabs as separate fundraising
to finance the organization’s exempt             Example. At a special event, an          events. Describe each of these events
activities. This is done by offering         organization received $100 in gross          by listing the type of event and the
goods or services that have more than        receipts for goods valued at $40. The        number of occasions that the event
a nominal value (compared to the price       organization entered gross revenue of        occurred and show (for each event):
charged) for a payment that is more          $40 on line 9a (in the right-hand               1. Gross receipts,
than the direct cost of those goods or       column) and entered a contribution of           2. Contributions included in gross
services.                                    $60 on both line 1b and line 9a (within      receipts (see Special events may
    The gross revenue from gaming            the parentheses). The contribution of        generate both revenue and
activities and other special events must     $60 was the difference between the           contributions, earlier),
be reported in the right-hand column on      gross revenue of $40 and the gross              3. Gross revenue (gross receipts
line 9a without reduction for cash or        receipts of $100.                            less contributions),
noncash prizes, cost of goods sold,              The expenses directly relating to the       4. Direct expenses, and
compensation, fees, or other expenses.       sale of the goods would be reported on          5. Net income or (loss) (gross
Check the box for gaming if the              line 9b. However, all expenses of            revenue less direct expenses).
organization conducted directly, or          raising contributions would be reported      For gaming, direct expenses include:
through a promoter, any amount of            in column (D), Fundraising, Part II and      cash and noncash prizes,
gaming during the year.                      not on line 9b.                              compensation to bingo callers and
    Gaming includes, but is not limited          For more details about contributions     workers, rental of gaming equipment,
to: bingo, pull tabs, instant bingo,         received through fundraising, and            cost of bingo supplies such as pull tab
raffles, scratch-offs, charitable gaming     contributions and revenue received           deals, etc.
tickets, break-opens, hard cards,            through special events, see the line 1          Include the same information, in total
banded tickets, jar tickets, pickle cards,   instructions. See also General               figures, for all other special events held
Lucky Seven cards, Nevada Club               Instruction L and its references.            that were not among the three largest.
tickets, casino nights, Las Vegas                                                         Indicate the type and number of the
nights, and coin-operated gambling           Sales or gifts of goods or services of
                                             only nominal value. If the goods or          events not listed individually (for
devices. Coin-operated gambling                                                           example, three dances and two raffles).
devices include slot machines,               services given or offered at special
electronic video slot or line games,         events have only nominal value, include         An example of this schedule of
video poker, video blackjack, video          all of the receipts as contributions on      special events might appear in
keno, video bingo, video pull tab            line 1b and all of the related expenses      columnar form as follows:
games, etc.                                  as fundraising expenses on line 15 and       Special Events (and the
                                             in column (D) of Part II. See General        number of occasions that   (A)   (B)    (C) All
    Characterizing any required payment      Instruction L for a description of           the event occurred):        #     #      # Other Total
as a donation or contribution on tickets     nominal or insubstantial benefits.
or on advertising or solicitation                                                         Gross Receipts             $xx   $xx    $xx   $xx   $xx
materials does not affect how such           An activity may generate only                Less: Contributions         xx     xx    xx    xx    xx
payments should be reported on Form          contributions. An activity that
                                                                                          Gross Revenue               xx     xx    xx    xx    xx
990 or Form 990-EZ. As discussed in          generates only contributions, such as a
                                             solicitation campaign by mail, is not a      Less: Direct Expenses       xx     xx    xx    xx    xx
the instructions for line 1, the amount of
the contribution is the excess of the        special event and should not be              Net Income or (Loss)       $xx   $xx    $xx   $xx   $xx

amount paid over the retail value of the     reported on line 9.
                                                                                             If the organization uses the above
goods or services received by the                Contributions from such an activity      schedule, report the total for
payer. See also Pub. 526.                    are reportable on line 1, and the related    Contributions on line 1b of Form 990
Special events may generate both             fundraising expenses are reportable in       and on line 9a (within the parentheses).
revenue and contributions. Special           column (D), Part II.                         Report the totals for Gross Revenue, in
events sometimes generate both                   The proceeds of solicitation             the right-hand column, on line 9a;
contributions and revenue. When a            campaigns in which the names of              Direct Expenses on line 9b; and Net
buyer pays more than the retail value of     contributors and other respondents are       Income or (Loss) on line 9c.
the goods or services furnished, enter:      entered in a drawing for the awarding of     Lines 10a through 10c. Gross
• As gross revenue, on line 9a (in the       prizes (so-called sweepstakes or
right-hand column), the retail value of      lotteries) are contributions, reportable     Profit or (Loss) from Sales of
the goods or services,                       on line 1, and the related expenses are      Inventory
• As a contribution, on both line 1b and     fundraising expenses, reportable in          Enter the gross sales (less returns and
line 9a (within the parentheses), the        column (D) of Part II. However, raffles      allowances), cost of goods sold, and
                                                               -30-                              Specific Instructions for Form 990
gross profit or (loss) from the sale of     organizations affiliated with (closely         services, publications, and materials,
inventory items. These sales do not         related to) a reporting agency.                from other organizations as Other
include items sold at special events that   Payments to affiliated state or                expenses on line 43. This is the case,
are reportable on line 9. Sales of          national organizations. Dues paid by           for example, if a charitable organization
inventory items reportable on line 10       the local charity to its affiliated state or   pays dues to a trade association
are sales of those items the                national (parent) organization are             comprised of otherwise unrelated
organization makes to sell to others or     usually reported on line 16. Report on         members.
buys for resale. Sales of investments       this line predetermined quota support          Attached schedule. Attach a
on which the organization expected to       and dues (excluding membership dues            schedule listing the name and address
profit by appreciation and sale are not     of the type described below) by local          of each affiliate that received payments
reported here. Report sales of              agencies to their state or national            reported on line 16. Specify the amount
investments on line 8.                      organizations for unspecified purposes;        and purpose of the payments to each
   On line 10a, report gross sales          that is, general use of funds for the          affiliate.
revenue from sales of inventory items,      national organization’s own program                   Properly distinguishing between
whether the sales activity is an exempt     and support services.                           TIP payments to affiliates and grants
function of the organization or an          Purchases from affiliates. Purchases                    and allocations is especially
unrelated trade or business.                of goods or services from affiliates are       important if the organization uses Form
   On line 10b, report the cost of goods    not reported on line 16 but are reported       990 for state reporting purposes. See
sold related to the sales of such           as expenses in the usual manner.               General Instruction E. If the
inventory. The usual items included in      Expenses for providing goods or                organization uses Form 990 only for
cost of goods sold are direct and           services to affiliates. In addition to         reporting to the IRS, payments to
indirect labor, materials and supplies      payments made directly to affiliated           affiliated state or national organizations
consumed, freight-in, and a proportion      organizations, expenses incurred in            that do not represent membership dues
of overhead expenses. Marketing and         providing goods or services to affiliates      reportable as Other expenses on line
distribution costs are not included in      may be reported on line 16 if:                 43 (see instructions, earlier) may be
cost of goods sold but are reported in          1. The goods or services provided          reported either on line 16 or line 22 and
Part II, column (B), Program services.      are not related to the program services        explained in the required attachment.
Attached schedule. In an attached           conducted by the organization                  Line 17. Total Expenses
schedule, give a breakdown of items         furnishing them (for example, when a
sold; for example, sales of food,                                                          Organizations using only column (A) of
                                            local organization incurs expenses in          Part II should enter the total of line 16
souvenirs, electronic equipment,            the production of a solicitation film for
uniforms, or educational publications.                                                     and line 44 of column (A), Part II, on
                                            the state or national organization); and       line 17. Other organizations should
Line 11. Other Revenue                          2. The costs involved are not              enter the total of lines 13 through 16.
                                            connected with the management and              Organizations using Form 5500 or an
Enter the total amount from Part VII,       general or fundraising functions of the
lines 103(a) through (e) (Other                                                            approved DOL form as a partial
                                            reporting organization. For example,           substitute for Form 990 should enter
revenue), columns (B), (D), and (E).        when a local organization gives a copy
This figure represents the total income                                                    the total expense figure from Form
                                            of its mailing list to the state or national   5500, or from the required reconciliation
from all sources not covered by lines 1     organization, the expense of preparing
through 10 of Part I. Examples of                                                          schedule if Form LM-2 or LM-3 is used.
                                            the copy provided may be reported on           See General Instruction F.
income includible on line 11 are interest   line 16, but not expenses of preparing
on notes receivable not held as             and maintaining the local organization’s       Line 18. Excess or (Deficit) for
investments or as program-related           master list.
investments (defined in the line 2
                                                                                           the Year
instructions); interest on loans to         Federated fundraising agencies.                Enter the difference between lines 12
officers, directors, trustees, key          These agencies (see the instructions           and 17. If line 17 is more than line 12,
employees, and other employees; and         for line 1c) should include in their own       enter the difference in parentheses.
royalties that are not investment income    support the full amount of contributions       Line 19. Net Assets or Fund
or program service revenue.                 received in connection with a                  Balances, Beginning of Year
                                            solicitation campaign they conduct,
Lines 13 through 15—Program                 even though donors designate specific          Enter the balance at the beginning of
Services, Management and                    agencies to receive part or all of their       the year as reported in column (A) of
General, and Fundraising                    individual contributions. These                line 73 (or from Form 5500 or an
Expenses                                    fundraising organizations should report        approved DOL form if General
                                            the allocations to participating agencies      Instruction F applies). The balance at
Section 4947(a)(1) nonexempt                                                               the beginning of the year for line 19
charitable trusts and section               as grants and allocations (line 22b) and
                                            quota support payments to their state          was the end of the year balance for line
501(c)(3) and (4) organizations.                                                           21 and 73 as reported on the
Complete Part II and then enter on          or national organization as payments to
                                            affiliates (line 16).                          organization’s prior year return.
lines 13 through 15 the appropriate
amounts from the totals for columns         Voluntary awards or grants to                  Line 20. Other Changes in Net
(B), (C), and (D) reported on line 44,      affiliates. Do not report on line 16           Assets or Fund Balances
Part II.                                    voluntary awards or grants made by the         Attach a schedule explaining any
All other organizations. All other          reporting agency to its state or national      changes in net assets or fund balances
organizations are not required to           organization for specified purposes.           between the beginning and end of the
complete lines 13 through 15 of the         Report these awards or grants on line          year that are not accounted for by the
Form 990.                                   22b, Other Grants and Allocations.             amount on line 18. Amounts to report
                                            Membership dues paid to other                  here include adjustments of earlier
Line 16. Payments to Affiliates             organizations. Report membership               years’ activity; unrealized gains and
This expense classification is used to      dues paid to obtain general                    losses on investments carried at market
report certain types of payments to         membership benefits, such as regular           value; and any difference between fair
Specific Instructions for Form 990                             -31-
market value and book value of              expenses such as occupancy, supplies,           Other expenses to report in column
property given as an award or grant.        and depreciation of office equipment,        (C) include those for meetings of the
See General Instruction G regarding         use an appropriate basis for each kind       board of directors or similar group;
the reporting of a section 481(a)           of cost. However, the organization           committee and staff meetings (unless
adjustment to conform to SFAS 116.          should report some other shared              held in connection with specific
                                            expenses in column (C) only. The             program services or fundraising
Line 21. Net Assets or Fund                 column instructions below discuss            activities); general legal services;
Balances, End of Year                       allocating expenses.                         accounting (including patient
Enter the total of lines 18, 19, and 20.                                                 accounting and billing); general liability
This total figure must equal the amount     Column (A)—Total                             insurance; office management;
reported for the end of the year in         For column (A), total each line item of      auditing, personnel, and other
column (B) of line 73.                      columns (B), (C), and (D) in Part II.        centralized services; preparation,
                                            Except for expenses the organization         publication, and distribution of an
                                            reports on lines 6b, 8b, 9b, 10b, or 16      annual report; and investment
Part II—Statement of                        of Part I, the organization should use       expenses (however, report rental
Functional Expenses                         column (A) to report all expenses the        income expenses on line 6b and
                                            organization paid or incurred.               program-related income expenses in
In General—                                                                              column (B)).
                                            Column (B)—Program Services                     The organization should report only
Column (A)                                  Program services are mainly those            general expenses in column (C). Do not
All organizations must complete column      activities that the reporting organization   use this column to report costs of
(A) unless they are using an approved       was created to conduct and which,            special meetings or other activities that
DOL form or Form 5500 as a partial          along with any activities commenced          relate to fundraising or specific program
substitute for Form 990. See General        subsequently, form the basis of the          services.
Instruction F.                              organization’s current exemption from
                                            tax. They may be self-funded or funded       Column (D)— Fundraising
Columns (B), (C), and (D)                   out of contributions, accumulated            Fundraising expenses are the total
These columns are optional for all          income, investment income, or any            expenses incurred in soliciting
organizations except section 4947(a)(1)     other source. Fundraising expenses           contributions, gifts, grants, etc. Report
nonexempt charitable trusts and section     should not be reported as                    as fundraising expenses all expenses,
501(c)(3) and (4) organizations. Section    program-related expenses even though         including allocable overhead costs,
4947(a)(1) nonexempt charitable trusts      one of the functions of the organization     incurred in: (a) publicizing and
and section 501(c)(3) and (4)               is to solicit contributions for other        conducting fundraising campaigns; (b)
organizations must complete columns         organizations.                               soliciting bequests and grants from
(B), (C), and (D).                                                                       foundations or other organizations, or
                                               Program services can also include         government grants reportable on line
   In Part II, the organization’s           the organization’s unrelated trade or        1d; (c) participating in federated
expenses are designated by object           business activities. For example,            fundraising campaigns; (d) preparing
classification (for example, salaries,      publishing a magazine is a program           and distributing fundraising manuals,
legal fees, supplies, etc.) and allocated   service even though the magazine             instructions, and other materials; and
into three functions: Program services      contains both editorials and articles that   (e) conducting special events that
(column (B)); Management and general        further the organization’s exempt            generate contributions reportable on
(column (C)); and Fundraising (column       purpose and advertising, the income          line 1b, in addition to revenue
(D)). These functions are explained         from which is taxable as unrelated           reportable in the right-hand column on
below in the instructions for the           business income.                             line 9a. However, report any expenses
columns. Do not include in Part II any                                                   that are directly attributable to revenue
expense items the organization must            If an organization receives a grant to
                                            do research, produce an item, or             shown on line 9a (for example, the
report on lines 6b, 8b, 9b, 10b, or 16 in                                                direct expenses incurred in furnishing
Part I.                                     perform a service, either to meet the
                                            grantor’s specific needs or to benefit       the goods or services sold) on line 9b.
   For reporting to the IRS only, use the   the public directly, the costs incurred
organization’s normal accounting            represent program service expenses.
                                                                                         Allocating Indirect Expenses
method to report total expenses in          Do not treat these costs as fundraising      Colleges, universities, hospitals, and
column (A) and to segregate them into       expenses, even if the organization           other organizations that accumulate
functions under columns (B), (C), and       reports the grant on line 1 as a             indirect expenses in various cost
(D). However, for state reporting           contribution.                                centers (such as the expenses of
requirements, see General Instructions                                                   operating and maintaining the physical
E and G. If the accounting system does      Column (C)— Management and                   plant) that are reallocated to the
not provide for this type of segregation,   General                                      program services and other functional
a reasonable method of allocation may       Use column (C) to report the                 areas of the organization in single or
be used. The amounts reported should        organization’s expenses for overall          multiple steps may find it easier to
be accurate and the method of               function and management, rather than         report these expenses in the following
allocation documented in the                for its direct conduct of fundraising        optional manner:
organization’s records.                     activities or program services. Overall         First, report the expenses of these
   Report, in the appropriate column,       management usually includes the              indirect cost centers on lines 25
expenses that are directly attributable     salaries and expenses of the chief           through 43 of column (C), Management
to a particular functional category. In     officer of the organization and that         and general, along with the expenses
general, allocate expenses that relate      officer’s staff. If part of their time is    properly reportable in that column.
to more than one functional category.       spent directly supervising program              Second, allocate the total
For example, allocate employees’            services and fundraising activities, their   expenses for each cost center to
salaries on the basis of each               salaries and expenses should be              columns (B), (C), and (D) (Program
employee’s time. For some shared            allocated among those functions.             services, Management and general,
                                                               -32-                           Specific Instructions for Form 990
and Fundraising) as a separate item                         cost center expenses to management           Accruals of present value increments to
entry on line 43, Other Expenses. Enter                     and general.                                 the unpaid grant should also be
the name of the cost center on line 43.                         The above is an example of a             reported on line 22 in future years.
If any of the cost center’s expenses are                    one-step allocation that shows how to
to be allocated to the expenses listed in                   report the allocation in Part II. This
                                                                                                         Line 22a. Grants Paid From
Part I (such as the expenses                                reporting method would actually be           Donor Advised Funds
attributable to special events and                          needed more for multiple step                Enter the amount of awards and grants
activities), enter these expenses as a                      allocations involving two or more cost       to individuals and organizations paid
negative figure in columns (A) and (C).                     centers. The total expenses of the first     from donor advised funds on line 22a.
This prevents reporting the same                            would be allocated to the other              See the line 1a instructions for the
expense in both Parts I and II. If part of                  functions, including an allocation of part   definition of a donor advised fund. See
the total cost center expenses are to be                    of these expenses to the second cost         the line 22 instructions, above, for
allocated to columns (B), Program                           center. The expenses of the second           general information on the reporting of
services, and (D), Fundraising, enter                       cost center would then be allocated to       grants and allocations paid. See the
these expenses as positive amounts in                       other functions and any remaining cost       instructions for line 22b for information
these columns and as single negative                        centers to be allocated, and so on. The      about the required schedule.
amounts in column (C), Management                           greater the number of these cost
and general. Do not make any entries                        centers that are allocated out, the more     Line 22b. Other Grants and
in column (A), Total, for these offsetting                  difficult it is to preserve the object       Allocations
entries.                                                    classification identity of the expenses of
                                                            each cost center (for example, salaries,               Do not include on line 22b
   Example. An organization reports
in column (C) $50,000 of its actual
                                                            interest, supplies, etc.). Using the           !       amounts paid from a donor
                                                                                                                   advised fund.
                                                            reporting method described above             CAUTION
management and general expenses
                                                            avoids this problem.
and $100,000 of expenses of an                                                                              Enter the amount of other awards
indirect cost center that are allocable in                          The intent of the above              and grants (not included on line 22a) to
part to other functions. The total of lines
25 through 43 of column (C) would be
                                                              !     instructions is only to facilitate
                                                            CAUTION reporting indirect expenses by
                                                                                                         individuals and organizations selected
                                                                                                         by the filing organization. United Way
$150,000 before the indirect cost center                    both object classification and function.     and similar fundraising organizations
allocations were made. Assume that                          These instructions do not permit the         should include allocations to member
$10,000 (of the $100,000 total                              allocation to other functions of             agencies.
expenses of the cost center) was                            expenses that should be reported as
allocable to fundraising; $70,000 to                        management and general expenses.             Attached schedule. Attach a
various program services; $15,000 to                                                                     schedule of amounts reported on line
management and general functions;                           Line 22. Grants and Allocations              22a and a separate schedule for line
and $5,000 to special events and                            The following instructions apply to lines    22b as applicable. Any grants or
activities. To report this in Part II under                 22a and 22b.                                 allocations reported on line 22b that
this optional method:                                                                                    were approved during the year, but not
                                                                Report voluntary awards and grants       paid by the due date for filing Form 990
    1. Indicate the cost center, the                        to affiliated organizations for specific     (including extensions), must be
expenses of which are being allocated,                      (restricted) purposes or projects also on    identified and listed separately in the
on line 43, as Allocation of (specify)                      line 22, but not required payments to        schedule for line 22b. On the applicable
expenses;                                                   affiliates reportable on line 16.            schedule show: (a) each class of
    2. Enter a decrease of $5,000 on                            Report scholarship, fellowship, and      activity; (b) grantee’s name, address,
the same line in the column (A), Total,                     research grants to individuals on line       and the amount given; and (c) (in the
representing the special event                              22. Certain other payments to, or for        case of grants to individuals)
expenses that were already reported on                      the benefit of, individuals may be           relationship of grantee if related by
line 9b in Part I;                                          reportable on line 23 instead. See the       blood, marriage, adoption, or
    3. Enter $70,000 on the same line in                    instructions for line 23 for details.        employment (including employees’
column (B), Program services;                                   Report only the amount of actual         children) to any person or corporation
    4. Enter $10,000 on the same line in                    grants and awards on line 22. Report         with an interest in the organization,
column (D), Fundraising; and                                expenses incurred in selecting               such as a creator, donor, director,
    5. Enter a decrease of $85,000 on                       recipients, or monitoring compliance         trustee, officer, etc.
the same line in column (C),                                with the terms of a grant or award, on           On the applicable schedule, classify
Management and general, to represent                        lines 25 through 43.                         activities in more detail than in such
the allocations to functional areas other                       In the spaces provided, give             broad terms as charitable, educational,
than management and general.                                separate totals for cash and noncash         religious, or scientific. For example,
                                                            grants and allocations made. Cash            identify payments for nursing services,
Line                  (A)      (B)       (C)       (D)      grants include only grants and               laboratory construction, or fellowships.
25 – 43a . . . . . . $ 150,000 $ —      $150,000 $ —        allocations paid by cash, checks,
43b Allocation of
                                                            money orders, wire transfers, and other          If property other than cash is given,
the $100,000
indirect cost                                               charges against funds on deposit at a        also show on the applicable schedule:
center expenses
                                                            financial institution.                       (a) a description of the property; (b) its
reported in (C) . .      (5,000) 70,000   (85,000) 10,000                                                book value and how the book value
44 . . . . . . . . . $ 145,000 $ 70,000 $ 65,000 $ 10,000       Reporting for line 22, in accordance     was determined; (c) its fair market
                                                            with SFAS 116, is acceptable for Form        value and how the fair market value
   After making these allocations, the                      990 purposes, but not required by IRS.       was determined; (d) the date of the gift.
column (C) total (line 44, column (C))                      However, see General Instruction E.          If the fair market value of the property
would be $65,000, consisting of the                             An organization that makes a grant       when the organization gave it is the
$50,000 actual management and                               to be paid in future years should,           measure of the award or grant, record
general expense amount and the                              according to SFAS 116, report the            any difference between fair market
$15,000 allocation of the aggregate                         grant’s present value on line 22.            value and book value in the
Specific Instructions for Form 990                                             -33-
organization’s books of account and on            In Part V-A, give the name and           expense of the organization (such as
line 20.                                      compensation (if any) of each current        interest on loans owed to the
    Colleges, universities, and primary       officer, director, trustee, and key          disqualified person), but not business
and secondary schools are not required        employee, along with the other               expenses paid under an accountable
to list the names of individuals who          information requested. In Part V-B, give     plan or de minimis fringe benefits. Do
were provided scholarships or other           the name and compensation (if any) of        not include on line 25c, amounts
financial assistance whether they are         each former officer, director, trustee,      previously included on lines 25a or 25b.
the recipients of federal grant money or      and key employee, along with the other          For a definition of disqualified
not. Instead, these organizations must        information requested. See the Part          persons, see Disqualified Persons
(a) group each type of financial aid          V-A instructions for a definition of key     under General Instruction P, earlier.
provided; (b) indicate the number of          employee.
individuals who received the aid; and             Form 941 must be filed to report         Line 26. Salaries and Wages of
(c) specify the aggregate dollar amount.      income tax withholding and social            Employees Not Included on
                                              security and Medicare taxes. The             Lines 25a, b, and c
Line 23. Specific Assistance to               organization must also file Form 940 to      Enter the total amount of employees’
Individuals                                   report federal unemployment taxes            salaries and wages, fees, bonuses,
Enter the amount of payments to, or for       unless the organization is not subject to    severance payments, and payments of
the benefit of, particular clients or         these taxes. See Pub.15 (Circular E) for     compensation deferred in a prior year
patients, including assistance rendered       details. See also the discussion of the      to all employees not reported on lines
by others at the expense of the filing        Trust Fund Recovery Penalty given in         25a, b, or c.
organization. Do not include grants to        General Instruction D.
other organizations that select the                                                        Line 27. Pension Plan
person(s) to receive the assistance           Lines 25a and 25b                            Contributions Not Included on
available through the use of the grant        Enter on line 25a the total                  Lines 25a, b, and c
funds. For example, report a payment          compensation for the tax year for the        Enter the employer’s share of
to a hospital to cover the medical            current officers, directors, trustees, and   contributions to qualified and
expenses of a particular individual on        key employees listed in Part V-A. Enter      nonqualified pension plans for the year.
line 23, but do not report a contribution     on line 25b the total compensation for       Do not include contributions to qualified
to a hospital to provide some service to      the tax year for the former officers,        pension plans under section 401(a) for
the general public or to unspecified          directors, trustees, and key employees       current or former officers, directors,
charity patients on this line. Also, do not   listed in Part V-B.                          trustees, or key employees, that were
include scholarship, fellowship, or               Section 501(c)(3) and (c)(4)             reported on lines 25a, b, or c.
research grants to individuals even           organizations and section 4947(a)(1)
though selected by the grantor                                                                Complete Form 5500 for the
                                              non-exempt charitable trusts must            organization’s plan and file it as a
organization. Report these grants on          allocate the total compensation in
line 22b, or line 22a, if applicable.                                                      separate return. If the organization has
                                              column (A) for lines 25a and lines 25b       more than one plan, complete a Form
Attached schedule. Attach a                   by functional expense in columns (B),        5500 for each plan. File the form by the
schedule showing the total payments           (C), and (D).                                last day of the 7th month after the plan
for each particular class of activity, such       Example. Allocate the total              year ends. See General Instruction D
as food, shelter, and clothing for            compensation figure of line 25a, column      for a discussion of Form 5500.
indigents or disaster victims; medical,       (A), by functional expenses represented
dental, and hospital fees and charges;        by line 25a, columns (B), (C), and (D).      Line 28. Employee Benefits Not
and direct cash assistance to indigents.      For instance, if key employee A spent        Included on Lines 25a–27
For payments to indigent families, do         90% of her time running a program            Enter the organization’s contributions to
not identify the individuals.                 which constitutes the basis of the           employee benefit programs (such as
Line 24. Benefits Paid to or for              organization’s exempt purpose and            insurance, health, and welfare
Members                                       10% in general management of the             programs) that are not an incidental
                                              organization itself, key employee A’s        part of a pension plan included on line
For an organization that provides             compensation should be allocated 90%         27.
benefits to members or dependents             to column (B), program services, and
(such as organizations exempt under                                                            Do not include contributions on
                                              10% to column (C), management and            behalf of current or former officers,
section 501(c)(8), (9), or (17)), attach a    general. Conversely, if Director B is not
schedule. Show amounts of: (a) death,                                                      directors, trustees, and key employees,
                                              paid as a member of the board, but is        that were included on lines 25a, b, or c.
sickness, hospitalization, or disability      employed by the organization as a
benefits; (b) unemployment                                                                 Report expenses for employee events
                                              part-time fundraiser, all of Director B’s    such as a picnic or holiday party on line
compensation benefits; and (c) other          compensation should be allocated to
benefits (state their nature). Do not                                                      28.
                                              column (D), fundraising.
report the cost of employment-related                                                      Line 29. Payroll Taxes
benefits the organization provides its        Line 25c. Compensation and
officers and employees on this line.                                                       Enter the amount of federal, state, and
                                              Other Distributions to                       local payroll taxes for the year but only
Report those expenses on lines 27 and         Disqualified Persons
28.                                                                                        those taxes that are imposed on the
                                              Enter the total compensation or other        organization as an employer. This
Line 25. Compensation of                      distributions provided to disqualified       includes the employer’s share of social
Current and Former Officers,                  persons (as defined under section            security and Medicare taxes, the
Directors and Certain                         4958(f)(1)) and persons described in         Federal unemployment tax (FUTA),
                                              section 4958(c)(3) for the year. For a       state unemployment compensation
Disqualified and Other Persons                definition of compensation, see the          taxes, and other state and local payroll
Compensation. Compensation                    instructions for line 25. Distributions      taxes. Do not include taxes withheld
includes all forms of income earned or        include anything of value provided to a      from employees’ salaries and paid to
received for services provided.               disqualified person that constitutes an      the various governmental units such as
                                                                -34-                            Specific Instructions for Form 990
federal and state income taxes and the       Line 35. Postage and Shipping               expenses as the rental of facilities,
employees’ shares of social security         Enter the total amount of postage,          speakers’ fees and expenses, and
and Medicare taxes.                          parcel delivery, trucking, and other        printed materials. Include the
                                             delivery expenses, including the cost of    registration fees (but not travel
Line 30. Professional                        shipping materials. Include the costs of    expenses) paid for sending any of the
Fundraising Fees                             outside mailing services on this line.      organization’s staff to conferences,
Enter on line 30 fundraising fees paid to                                                meetings, or conventions conducted by
independent contractors and outside          Line 36. Occupancy                          other organizations. However, do not
vendors and suppliers in carrying out        Enter the total amount paid or incurred     include on this line the salaries and
fundraising activities. Include on line 30   for the use of office space or other        travel expenses of the reporting
fundraising expenses such as printing,       facilities, heat, light, power, and other   organization’s own officers, directors,
paper, envelopes, postage, mailing list      utilities (other than telephone expenses    trustees, and employees who
rental, and equipment rental, incurred in    reported on line 34), outside janitorial    participate.
a fundraising activity conducted by an       services, mortgage interest, property
                                             insurance, real estate taxes, and similar   Line 41. Interest
independent contractor. Fundraising
                                             expenses.                                   Enter the total interest expense for the
expenses also include amounts the
                                                                                         year. Do not include any interest
organization reimburses to a fundraiser.         Occupancy expenses paid or
                                                                                         attributable to rental property
                                             incurred for program-related income,
   For purposes of line 30, fundraising                                                  (reportable on line 6b) or any mortgage
                                             reportable on line 2, are included on
activities include gaming, vehicle and                                                   interest treated as occupancy expense
                                             line 36. Do not subtract rental income
other property donation programs, and                                                    on line 36.
                                             received from renting or subletting
special events. Fees and expenses            rented space from the amount reported
incurred by the organization, whether
                                                                                         Line 42. Depreciation,
                                             for occupancy expense on line 36. If        Depletion, etc.
by payment to independent contractors,       the activities of the organization’s
vendors, or suppliers, or by deduction       tenant are related to the reporting         If the organization records depreciation,
from proceeds received by the                organization’s exempt purpose, report       depletion, and similar expenses, enter
organization, are included on line 30.       rental income as program-service            the total for the year. Include any
                                             revenue and allocable occupancy             depreciation (amortization) of leasehold
     Do not include on line 30 salaries of                                               improvements. The organization is not
employees who undertake fundraising          expenses on line 36. However, if the
                                             tenant’s activities are not                 required to use the Modified
as part of their employment duties.                                                      Accelerated Cost Recovery System
Compensation related to fundraising          program-related, report such rental
                                             income on line 6a and related rental        (MACRS) to compute the depreciation
paid to non-key employees is allocated                                                   reported on Form 990 or Form 990-EZ.
to line 26, Column (D). Compensation         expenses on line 6b.
                                                                                         If the organization records depreciation
related to fundraising paid to officers,         Do not include, as an occupancy         using MACRS, attach Form 4562, or a
directors, trustees, and key employees       expense, depreciation (reportable on        schedule showing the same information
is allocated to line 25, Column (D).         line 42) or any salaries of the reporting   required by Form 4562. If the
                                             organization’s own employees                organization does not use MACRS,
   In addition to completing line 30, the    (reportable on line 26).                    attach a schedule showing how
organization should keep for its                                                         depreciation was computed.
permanent records a list of fees and         Line 37. Equipment Rental and
expenses for each fundraising activity.      Maintenance                                     For an explanation of acceptable
Do not include this list with the            Enter the cost of renting and               methods for computing depreciation,
organization Form 990.                       maintaining office equipment and other      see Pub. 946.
                                             equipment, except for automobile and            If the organization claims a
Line 31. Accounting Fees                     truck expenses reportable on lines 35       deduction for depletion, attach a
Enter the total accounting and auditing      and 39.                                     schedule explaining the deduction.
fees charged by outside firms and            Line 38. Printing and
individuals who are not employees of                                                     Line 43. Other Expenses
the reporting organization.                  Publications                                Show the type and amount of each
                                             Enter the printing and related costs of     functional expense for which a separate
Line 32. Legal Fees                          producing the reporting organization’s      line is not provided. The organization
Enter the total legal fees charged by        own newsletters, leaflets, films, and       may report minor miscellaneous
outside firms and individuals who are        other informational materials on this       expenses as a single total. The total of
not employees of the reporting               line. Also include the cost of any          minor miscellaneous expenses grouped
organization. Do not include any             purchased publications. However, do         together on line 43 cannot exceed 5%
penalties, fines, or judgments imposed       not include any expenses, such as           of the total of all functional expenses on
against the organization as a result of      salaries or postage, for which a            line 44.
legal proceedings. Report those              separate line is provided in Part II.
                                                                                             The following expenses must be
expenses on line 43, Other expenses.         Line 39. Travel                             categorized and reported separately on
                                             Enter the total travel expenses,            line 43:
Line 33. Supplies                                                                            1. For health care organizations,
                                             including transportation costs (fares,
Enter the total for office, classroom,       mileage allowances, and automobile          payments to heath care professionals
medical, and other supplies used during      expenses), meals and lodging, and per       who are not employees of the health
the year, as determined by the               diem payments.                              care organization.
organization’s normal method of                                                              2. Investment counseling and other
accounting for supplies.                     Line 40. Conferences,                       professional fees. (Do not include
                                             Conventions, and Meetings                   professional fundraising fees,
Line 34. Telephone                           Enter the total expenses incurred by        accounting fees, or legal fees on line
Enter the total telephone, telegram, and     the organization in conducting meetings     43; these are reportable on lines 30
similar expenses for the year.               related to its activities. Include such     through 32.)
Specific Instructions for Form 990                             -35-
    3. Penalties, fines, and judgments.            Organizations answering “Yes” to                        • Give reasonable estimates for any
    4. Unrelated business income taxes.        the joint-cost question following line 44                   statistical information if exact figures are
    5. Insurance and real estate taxes         must furnish the relevant financial data                    not readily available. Indicate that this
not attributable to rental property or         in the spaces provided.                                     information is estimated.
reported as occupancy expenses.                                                                            • Be clear, concise, and complete in the
    6. Other expenses the organization            An organization conducts a                               description. Avoid adding an attachment.
tracks, not included on other lines of         combined educational campaign and
Part II.                                       fundraising solicitation when it solicits               3   If part of the total expenses of any
    7. Payments of travel or                   contributions (by mail, telephone,                          program service consists of grants and
entertainment expenses (including              broadcast media, or any other means)                        allocations reported on line 22a or 22b,
reimbursements for such costs) for any                                                                     enter the amount of grants and
                                               and includes, with the solicitation,                        allocations in the space provided and
federal, state or local government
                                               educational material or other                               include the grants and allocations in the
officials (as determined under section
4946(c)) and their family members (as          information that furthers a bona fide                       Expenses column. If the amount of grants
determined under section 4946(d)). The         nonfundraising exempt purpose of the                        and allocations entered includes foreign
                                               organization.                                               grants, check the box to the left of the
reported total amount should include:                                                                      entry space for Program services
    a. Each separate expenditure                                                                           expenses.
relating to a government official or              Expenses attributable to providing
                                               information regarding the organization                      • Section 501(c)(3) and (4) organizations,
family member of such official that                                                                        and section 4947(a)(1) nonexempt
exceeds $200, and                              itself, its use of past contributions, or its
                                                                                                           charitable trusts, must show the amount
    b. Aggregate expenditures relating         planned use of contributions received                       of grants and allocations to others and
to a government official or family             are not program service expenses and                        must enter the total expenses for each
member of such official that exceed            should not be included in column (B).                       program service reported.
$1,000 for the year.                           This is true whether or not the
                                                                                                           • For all other organizations, completing
                                               organization accounts for joint costs in                    the Program Services Expenses column
                                               accordance with the AICPA’s                                 (and the Grants and allocations entry) in
         Do not double count
                                               Statement of Position 98-2, Accounting
  !      expenditures that are described
 CAUTION in both a and b above. For
                                               for Costs of Materials and Activities of
                                                                                                           Part III is optional.

                                               Not-for-Profit Organizations and State                  4   Attach a schedule that lists the
expenditures that are not specifically
identifiable to a particular individual, the   and Local Government Entities that                          organization’s other program services.
organization may use any reasonable            Include Fund Raising. Any method of                         • The detailed information required for the
allocation method to estimate the cost         allocating joint costs to program service                   four largest services is not necessary for
of the expenditure to an individual.           expenses must be reasonable under                           this schedule.
Amounts not described in a and b               the facts and circumstances of each                         • Section 501(c)(3) and (4) organizations,
above may be included in this amount           case. Most states with reporting                            and section 4947(a)(1) nonexempt
or, provided that such amounts do not          requirements for charitable and other                       charitable trusts, however, must show the
exceed 5% of total functional expenses,        organizations that solicit contributions                    expenses attributable to their program
may be grouped with other minor                either require or allow the reporting of                    services.
miscellaneous expenses. The                    joint costs according to Statement of
                                               Position 98-2 standards.                                5   The organization may show the amount
organization is responsible for keeping                                                                    of any donated services, or use of
records for all travel and entertainment                                                                   materials, equipment, or facilities it
expenses related to a government                                                                           received or utilized in connection with a
official regardless of whether reported        Part III—Statement of                                       specific program service.
in this amount or as other minor
                                               Program Service                                             • Disclose the applicable amounts of any
miscellaneous expenses.                                                                                    donated services, etc., on the lines for the
State reporting — miscellaneous
                                               Accomplishments                                             narrative description of the appropriate
expenses. Some states that accept              A program service is a major (usually                       program service.
Form 990, or Form 990-EZ, in                   ongoing) objective of an organization,                      • Do not include these amounts in the
satisfaction of their filing requirements      such as adoptions, recreation for the                       expense column in Part III.
may require that certain types of              elderly, rehabilitation, or publication of
                                                                                                           • See the instructions for line 82.
miscellaneous expenses be itemized             journals or newsletters.
regardless of amount. See General
Instruction E.                                 Step                     Action

Line 44. Total Functional                       1     State the organization’s primary exempt         Part IV—Balance Sheets
Expenses                                              purpose.
                                                                                                      All organizations, except those that
Add lines 22a through 43g and enter             2     All organizations must describe their
                                                                                                      meet one of the exceptions in General
the totals on line 44 in columns (A), (B),            exempt purpose achievements for each            Instruction F, must complete all of Part
(C), and (D). Report the total amounts                of their four largest program services (as      IV and may not submit a substitute
for columns (B), (C), and (D) in Part I,              measured by total expenses incurred). If        balance sheet. Failure to complete Part
lines 13 through 15.                                  there were four or fewer of such activities,    IV may result in penalties for filing an
                                                      describe each program service activity.         incomplete return. See General
Reporting of Joint Costs                              • Describe program service                      Instruction K. If there is no amount to
Organizations that included in program                accomplishments through measurements            report in column (A), Beginning of year,
service expenses (column (B) of Part II)              such as clients served, days of care,           place a zero in that column.
any joint costs from a combined                       therapy sessions, or publications issued.
educational campaign and fundraising                  • Describe the activity’s objective, for both      See General Instruction E for details
solicitation must disclose how the total              this time period and the longer-term goal,      on completing a Form 990, or Form
joint costs of all such combined                      if the output is intangible, such as in a       990-EZ, to be filed with any state or
activities were reported in Part II.                  research activity.                              local governmental agency.
                                                                      -36-                                 Specific Instructions for Form 990
   When a schedule is required to be           and key employees, and all secured          as all other members of the
attached for any line item in Part IV, it is   and unsecured loans to such persons,        organization.
only for the end-of-year balance sheet         on line 50a and in an attached                  Schedule format. For each
figure reported in column (B). Give the        schedule discussed below. Report            outstanding loan, or other receivable
end-of-year figures for any receivables        interest from such receivables on line      that must be reported separately, the
or depreciable assets and the related          11. For a definition of key employee,       attached schedule should show the
allowances for doubtful accounts or            see the instructions in Part V-A.           following information (preferably in
accumulated depreciation reported                  In the required schedule, report each   columnar form):
within the description column.                 receivable separately even if more than         1. Borrower’s name and title,
Line 45. Cash—                                 one loan was made to the same person            2. Original amount,
Non-Interest-Bearing                           or the same terms apply to all loans.           3. Balance due,
                                               Report salary advances, and other               4. Date of note,
Enter the total of non-interest-bearing        advances for the personal use and               5. Maturity date,
checking accounts, deposits in transit,        benefit of the recipient, and receivables       6. Repayment terms,
change funds, petty cash funds, or any         subject to special terms, or arising from       7. Interest rate,
other non-interest-bearing account. Do         nontypical transactions, as separate            8. Security provided by the
not include advances to employees or           loans for each current and former           borrower,
officers or refundable deposits paid to        officer, director, trustee, and key             9. Purpose of the loan, and
suppliers or others.                           employee. For credit unions, report only      10. Description and fair market value
Line 46. Savings and                           loans, or receivables that are not made     of the consideration furnished by the
                                               on the same terms as all other              lender (for example, cash — $1,000; or
Temporary Cash Investments                     members of the organization.                100 shares of XYZ, Inc., common
Enter the total of interest-bearing                                                        stock — $9,000).
checking accounts, savings and                     Schedule format. For each
temporary cash investments, such as            outstanding loan, or other receivable
                                               that must be reported separately, the       Line 51. Other Notes and Loans
money market funds, commercial
paper, certificates of deposit, and U.S.       attached schedule should show the           Receivable
Treasury bills or other governmental           following information (preferably in        Line 51a. Enter on line 51a the
obligations that mature in less than 1         columnar form):                             combined total of receivables (both
year. Report the income from these                 1. Borrower’s name and title,           notes and loans) to non-key
investments on line 4.                             2. Original amount,                     employees. Do not include the following
                                                   3. Balance due,                         on line 51a.
Line 47. Accounts Receivable                       4. Date of note,                        • Receivables reported on line 50.
Enter the total accounts receivable                5. Maturity date,                       • Program-related investments.
(reduced by the allowance for doubtful             6. Repayment terms,                     (Report program-related investments
accounts) from the sale of goods and/or            7. Interest rate,                       on line 58.)
the performance of services. Report                8. Security provided by the             • Notes receivable acquired as
claims against vendors or refundable           borrower,                                   investments (report receivables
deposits with suppliers or others here, if         9. Purpose of the loan, and             acquired as investments on line 56).
not significant in amount. Otherwise,            10. Description and fair market value         For notes and loans that represent
report them on line 58, Other assets.          of the consideration furnished by the       program-related investments (defined in
Report any receivables due from                lender (for example, cash — $1,000; or      the line 2 instructions), report the
officers, directors, trustees, or key          100 shares of XYZ, Inc., common             interest income on line 2. For all other
employees on line 50. Report                   stock — $9,000).                            notes and loans receivable included on
receivables (including loans and                                                           line 51, report the income on line 11.
advances) due from other employees             Line 50b. Receivables From                  Line 51b. Enter on line 51b the total
on line 51a.                                   Other Disqualified Persons                  amount of doubtful accounts.
Line 48a. Pledges Receivable                   Report all receivables due from                 Notes receivable. Enter the
Enter the total pledges receivable             disqualified persons (as defined under      amount of all notes receivable not listed
recorded as of the beginning and end           section 4958(f)(1)) and persons             on line 50 and not acquired as
of the year. Do not include the amount         described in section 4958(c)(3)(B) for      investments. Attach a schedule similar
of pledges estimated to be                     the year on line 50b and in a required      to that requested in the instructions for
uncollectible.                                 attached schedule. Do not include on        line 50. The schedule should also
                                               line 50b, amounts reported on line 50a.     describe the family or business
Line 49. Grants Receivable                         For a definition of disqualified        relationship of the borrower to any
Enter the total grants receivable from         persons, see Disqualified Person under      officer, director, trustee, key employee,
governmental agencies, foundations,            General Instruction P, earlier.             or substantial contributor of the
and other organizations as of the                                                          organization.
                                                   Report each receivable separately
beginning and end of the year.                 even if more than one loan was made             Notes receivable from loans by a
Organizations that follow SFAS 116             to the same person or the same terms        credit union to its members and
may report the present value of the            apply to all loans. Report advances for     scholarship loans by a section 501(c)(3)
grants receivable as of each balance           the personal use and benefit of the         organization do not have to be
sheet date.                                    recipient, and receivables subject to       itemized. However, identify these loans
                                               special terms, or arising from nontypical   as such on a schedule and indicate the
Line 50a. Receivables From                                                                 total amount of such loans that are
Current and Former Officers,                   transactions, as separate loans for
                                               each disqualified person that is not a      outstanding.
Directors, Trustees, and Key                   current or former officer, director,            For a note receivable from another
Employees                                      trustee, or key employee. For credit        organization exempt under the same
Report all receivables due from current        unions, report only loans, or receivables   paragraph of section 501(c) as the filing
and former officers, directors, trustees,      that are not made on the same terms         organization, list only the name of the
Specific Instructions for Form 990                               -37-
borrower and the balance due. For           Line 52. Inventories For Sale Or                Attached schedule. On the
example, a section 501(c)(3)                Use                                          attached schedule, give the following
organization would have to provide the                                                   information for each security held at the
                                            Enter the amount of materials, goods,
full details of a loan to a section                                                      end of the organization’s tax year.
                                            and supplies purchased, manufactured
501(c)(4) organization but would have
                                            by the organization, or donated and          • A description of the security,
to provide only the name of the                                                          including the value recorded at the time
                                            held for future sale or use.
borrower and the balance due on a                                                        of receipt in the case of donated
note from a loan to another section         Line 53. Prepaid Expenses and                securities,
501(c)(3) organization.                     Deferred Charges                             • The book value of the security, and
                                            Enter the amount of short-term and           • The valuation method that was used
   Loans receivable. Enter the gross                                                     (cost or the total book value of all
amount of loans receivable, less the        long-term prepayments of expenses
                                            attributable to one or more future           securities listed on the attachment must
allowance for doubtful accounts, from                                                    agree with the amount entered on line
the normal activities of the filing         accounting periods. Examples include
                                            prepayments of rent, insurance, and          54b, column (B)).
organization such as loans by a credit
union to its members or scholarship         pension costs, and expenses incurred
                                            for a solicitation campaign of a future      Line 55. Investments—Land,
loans by a section 501(c)(3)
organization. A schedule of these loans     accounting period.                           Buildings, and Equipment
is not required.                                                                         Enter the book value (cost or other
                                            Line 54a. Investments—                       basis less accumulated depreciation) of
    Report loans to current and former      Publicly Traded Securities                   all land, buildings, and equipment held
officers, directors, trustees, and key      Enter the book value, which may be           for investment purposes, such as rental
employees on line 50. Report loans to       market value, of securities held as          properties. Attach a schedule listing
non-key employees, vendors, suppliers,      investments. Check the appropriate box       these fixed assets held as investments
and independent contractors on line 51.     to indicate whether the securities are       at the end of the year. Show for each
Attach a schedule similar to that called    reported at cost or fair market value.       item or category listed, the cost or other
for in the instructions for line 50. The    Publicly traded securities include           basis, accumulated depreciation, and
schedule should also describe the           common and preferred stocks, bonds           book value. Report the income from
family or business relationship, if any,    (including governmental obligations          these assets on line 6a.
between the borrower and any officer,       such as bonds and Treasury bills), and
director, trustee, key employee, or         mutual fund shares that are listed and       Line 56. Investments—Other
substantial contributor of the              regularly traded in an over-the-counter      Enter the amount of all other
organization as defined in section          market or on an established exchange         investment holdings not reported on
507(d)(2)(A).                               and for which market quotations are          line 54a, 54b, or 55. Attach a schedule,
                                            published or otherwise readily               listing and describing each of these
   Family relationships include an          available.                                   investments held at the end of the year.
individual’s spouse, ancestors, children,       Do not report stock holdings that        Show the book value for each and
grandchildren, great-grandchildren,         represent 5% or more of the                  indicate whether the investment is listed
siblings (whether by whole or half          outstanding shares of stock of the           at cost or end-of-year market value.
blood), and the spouses of children,        same class. Instead, report them on          Report the income from these assets
grandchildren, great-grandchildren, and     line 54b. Report dividends and interest      on line 7. Do not include
siblings.                                   from these securities on line 5 of Part I,   program-related investments. See the
                                            Revenue.                                     instructions for line 58.
    Business relationships are
employment and contractual                  Line 54b. Investments—Other                  Line 57. Land, Buildings, and
relationships, and common ownership         Securities
of a business where any officers,                                                        Equipment
directors, or trustees, individually or     Enter the book value, which may be           Enter the book value (cost or other
together, possess more than a 35%           market value, of securities held as          basis less accumulated depreciation) of
ownership interest in common.               investments that are not publicly traded     all land, buildings, and equipment
Ownership is voting power in a              or that represent 5% or more of the          owned by the organization and not held
corporation, profits interest in a          outstanding shares of the same class.        for investment. This includes any
partnership, or beneficial interest in a    Check the appropriate box to indicate        property, plant, and equipment owned
trust. Employment and contractual           whether the securities are reported at       and used by the organization in
relationships include relationships         cost or fair market value. When valuing      conducting its exempt activities. Attach
through a sole proprietorship or            securities at fair market value, use         a schedule listing these fixed assets
partnership (for example, a borrower is     commonly accepted valuation methods.         held at the end of the year and
employed by a partnership in which one      (See Regulations section 20.2031-2.)         showing, for each item or category
of the organization’s directors is a            Attach a schedule that lists the         listed, the cost or other basis,
partner) but not through a corporation      securities held at the end of the year.      accumulated depreciation, and book
(for example, a borrower is employed        Indicate whether the securities are          value.
by a corporation in which one of the        listed at cost (including the value
organization’s directors is a               recorded at the time of receipt in the       Line 58. Other Assets, Including
shareholder, director, or officer).         case of donated securities) or               Program-Related Investments
                                            end-of-year market value. Do not             List and show the book value of each
   See General Instruction X regarding      include amounts reported on line 46.         category of assets not reportable on
due diligence requirements to               Securities not publicly traded.              lines 45 through 57. If more space is
determine business relationships.           Securities that are not publicly traded      needed, attach a schedule (see
                                            include investments such as stock in a       Attachment under General Instruction
       Report program-related               closely held company whose stock is          X) and enter the total book value of all
 TIP investments on line 58.                not available for sale to the general        categories of other assets on line 58.
                                            public or which is not widely traded.        For interest earned on notes and loans
                                                              -38-                            Specific Instructions for Form 990
that represent program-related              amount of the mortgage on line 64a,             the IRS does not (see General
investments, report income on line 2.       and not on line 64b. For such                   Instruction E). However, a Form 990, or
   One type of asset reportable on line     mortgage, include in the above listing,         Form 990-EZ, return prepared in
58 is program-related investments.          the maturity date of the debt,                  accordance with SFAS 117 will be
These are investments made primarily        repayment terms, interest rate, and any         acceptable to the IRS.
to accomplish an exempt purpose of          security provided by the organization.          Organizations that follow SFAS 117.
the filing organization rather than to          Line 64a does not, however, refer to        If the organization follows SFAS 117,
produce income.                             situations where the organization only          check the box above line 67. Classify
                                            has a contingent liability, as it would if it   and report net assets in three groups —
Line 59. Total Assets                       were a guarantor of tax-exempt bonds            unrestricted, temporarily restricted, and
Enter the total of lines 45 through 58.     issued by a related entity. Contingent          permanently restricted — based on the
The amounts on line 59 must equal the       liabilities, such as those that arise from      existence or absence of donor-imposed
amounts on line 74 for both the             guarantees, must be included as an              restrictions and the nature of those
beginning and end of the year.              entry in the separately attached                restrictions. Show the sum of the three
Line 60. Accounts Payable and               schedule required for line 64a.                 classes of net assets on line 73. On line
                                            Attachment. For all such bonds and              74, add the amounts on lines 66 and 73
Accrued Expenses                                                                            to show total liabilities and net assets.
Enter the total of accounts payable to      obligations outstanding at any time
                                            during the year, attach a schedule              This figure should be the same as the
suppliers and others and accrued                                                            figure for Total assets on line 59.
expenses, such as salaries payable,         showing for each separate issue:
accrued payroll taxes, and interest         • The purpose of the issue,                     Line 67. Unrestricted
payable.                                    • The amount of the issue outstanding,
                                            and                                             Enter the balances per books of the
Line 61. Grants Payable                     • The unexpended bond proceeds, if              unrestricted class of net assets.
                                            any.                                            Unrestricted net assets are neither
Enter the unpaid portion of grants and                                                      permanently restricted nor temporarily
awards that the organization has made           Also, show if any portion of any bond       restricted by donor-imposed
a commitment to pay other                   financed facility was used by a third           stipulations. All funds without
organizations or individuals, whether or    party (other than a governmental unit or        donor-imposed restrictions must be
not the commitments have been               a Section 501(c)(3) organization). If so,       classified as unrestricted, regardless of
communicated to the grantees.               list the percentage of space used by            the existence of any board designations
                                            the third party.                                or appropriations.
Line 62. Deferred Revenue
Include revenue that the organization       Line 64b. Mortgages and Other                   Line 68. Temporarily Restricted
has received but not yet earned as of       Notes Payable                                   Enter the balance per books for the
the balance sheet date under its            Enter the amount of mortgages and
method of accounting.                                                                       temporarily restricted class of net
                                            other notes payable at the beginning            assets. Donors’ temporary restrictions
Line 63. Loans From Officers,               and end of the year. Attach a schedule          may require that resources be used in a
                                            showing, as of the end of the year, the         later period or after a specified date
Directors, Trustees, and Key                total amount of all mortgages payable
Employees                                                                                   (time restrictions), or that resources be
                                            and, for each nonmortgage note                  used for a specified purpose (purpose
Enter the unpaid balance of loans           payable, the name of the lender and             restrictions), or both.
received from current and former            the other information specified in items
officers, directors, trustees, and key      2 through 10 of the instructions for line       Line 69. Permanently Restricted
employees. See the instructions for         50a. The schedule should also identify          Enter the total of the balances for the
Part V-A for the definition of key          the relationship of the lender to any           permanently restricted class of net
employee. For loans outstanding at the      officer, director, trustee, or key              assets. Permanently restricted net
end of the year, attach a schedule that     employee of the organization.                   assets are (a) assets, such as land or
shows, for each loan, the name and                                                          works of art, donated with stipulations
title of the lender and the information     Line 65. Other Liabilities
                                                                                            that they be used for a specified
specified in items 2 through 10 of the      List and show the amount of each                purpose, be preserved, and not be sold
instructions for line 50a.                  liability not reportable on lines 60            or (b) assets donated with stipulations
                                            through 65. Attach a separate schedule          that they be invested to provide a
Line 64a. Tax-Exempt Bond                   if more space is needed.
Liabilities                                                                                 permanent source of income. The latter
                                            Lines 67 through 69. Net Assets                 result from gifts and bequests that
Enter the amount of tax-exempt bonds                                                        create permanent endowment funds.
(or other obligations) issued by the        The Financial Accounting Standards
organization on behalf of a state or        Board issued Financial Statements of            Organizations that do not follow
local governmental unit, or by a state or   Not-for-Profit Organizations (SFAS              SFAS 117. If the organization does
local governmental unit on behalf of the    117). SFAS 117 provides standards for           not follow SFAS 117, check the box
organization, and for which the             external financial statements certified         above line 70 and report account
organization has a direct or indirect       by an independent accountant for                balances on lines 70 through 72.
liability. Tax-exempt bonds include         certain types of nonprofit organizations.       Report net assets or fund balances on
state or local bonds and any                SFAS 117 does not apply to credit               line 73. Complete line 74 to report the
obligations, including direct borrowing     unions, voluntary employees’                    sum of the total liabilities and net
from a lender, or certificates of           beneficiary associations, supplemental          assets.
participation, the interest on which is     unemployment benefit trusts, section               Some states that accept Form 990,
excluded from the income of the             501(c)(12) cooperatives, and other              or Form 990-EZ, as their basic
recipient for federal income tax            member benefit or mutual benefit                reporting form may require a separate
purposes under section 103.                 organizations.                                  statement of changes in net assets/
    If the tax-exempt bond or obligation       While some states may require                fund balances. See General Instruction
is in the form of a mortgage, include the   reporting in accordance with SFAS 117,          E.
Specific Instructions for Form 990                              -39-
Line 70. Capital Stock, Trust                                                                   Give the preferred address at which
Principal, or Current Funds                  Parts IV-A and IV-B—                           officers, directors, etc., want the
For corporations, enter the balance per      Reconciliation Statements                      Internal Revenue Service to contact
                                             Use these reconciliation statements to         them.
books for capital stock accounts. Show
par or stated value (or for stock with no    reconcile the differences between the              Use an attachment if there are more
par or stated value, total amount            revenue and expenses shown on the              persons to list in Part V-A.
received upon issuance) of all classes       organization’s audited financial                   Show all forms of cash and noncash
of stock issued and, as yet,                 statements prepared in accordance              compensation received by each listed
uncancelled. For trusts, enter the           with SFAS 117 and the revenue and              officer, director, etc., whether paid
amount in the trust principal or corpus      expenses shown on the organization’s           currently or deferred.
account. For organizations continuing        Form 990.
                                                                                                If the organization pays any other
to use the fund method of accounting,           If the organization did not receive an      person, such as a management
enter the fund balances for the              audited financial statement for 2007 (or       services company, for the services
organization’s current restricted and        the fiscal year for which it is completing     provided by any of its officers, directors,
unrestricted funds.                          this Form 990) and prepared the return         trustees, or key employees, report the
                                             in accordance with SFAS 117, it does           compensation and other items in Part
                                             not need to complete Parts IV-A or IV-B        V-A as if the organization had paid the
Line 71. Paid-In or Capital                  and should instead enter “N/A” on line a       officers, directors, etc., directly. Also
Surplus, or Land, Bldg., and                 of each Part.                                  see Ann. 2001-33, 2001-17 I.R.B.
Equipment Fund                                                                              1137.
                                               These two Parts do not have to be
Enter the balance per books for all          completed on group returns.                        A failure to fully complete Part V-A
paid-in capital in excess of par or stated                                                  can subject both the organization and
value for all stock issued and                  On line d1 of Parts IV-A and IV-B,          the individuals responsible for such
uncancelled. If stockholders or others       include only those investment expenses         failure to penalties for filing an
gave donations that the organization         netted against investment income in the        incomplete return. See General
records as paid-in capital, include them     revenue portion of the organization’s          Instruction K. In particular, entering the
here. Report any current-year                audited financial statements. Do not           phrase on Part V-A, “Information
donations the organization included on       include program-related investment             available upon request,” or a similar
line 71 in Part I, line 1. Enter the fund    expenses or other expenses reported            phrase, is not acceptable.
                                             as program service expenses in the
balance for the land, building, and                                                             The organization may also provide
                                             audited statement of activities.
equipment fund on this line.                                                                an attachment to explain the entire
                                                                                            2007 compensation package for any
Line 72. Retained Earnings or                Part V-A — Current Officers,                   person listed in Part V-A.
Accumulated Income,                          Directors, Trustees, and Key                       Each person listed in Part V-A
                                                                                            should report the listed compensation
Endowment, or Other Funds                    Employees                                      on his or her income tax return unless
For corporations, enter the balance in       List each person who was a current             the Code specifically excludes any of
the retained earnings, or similar            officer, director, trustee, or key             the payments from income tax. See
account, minus the cost of any               employee (defined below) of the                Pub. 525 for details.
corporate treasury stock. For trusts,        organization or disregarded entity
                                             described in Regulations sections                  Key employee. A key employee is
enter the balance per books in the                                                          any person having responsibilities,
accumulated income or similar account.       301.7701-1 through 301.7701-3 at any
                                             time during the year even if they did not      powers, or influence similar to those of
For those organizations using fund                                                          officers, directors, or trustees. The term
accounting, enter the total of the fund      receive any compensation from the
                                             organization. If person is listed in Part      includes the chief management and
balances for the permanent and term                                                         administrative officials of an
endowment funds as well as balances          V-A, then list all of that person’s
                                             compensation from the organization in          organization (such as an executive
of any other funds not reported on lines                                                    director or chancellor).
70 and 71.                                   Part V-A, whether received as a current
                                             officer, as a former officer, or in another        A chief financial officer and the
                                             capacity (for example, independent             officer in charge of the administration or
Line 73. Total Net Assets or                 contractor).                                   program operations are both key
Fund Balances                                                                               employees if they have the authority to
                                                For purposes of reporting all               control the organization’s activities, its
For organizations that follow SFAS 117,      amounts in columns (B) through (E) in
enter the total of lines 67 through 69.                                                     finances, or both.
                                             Part V-A, either use the organizations
For all other organizations, enter the       tax year, or the calendar year ending          Column (A)
total of lines 70 through 72. Enter the      within such tax year.                          Report the name and address of each
beginning-of-the-year figure on line 73,                                                    person who was a current officer,
column (A), in Part I, line 19. The             Enter a zero in columns (B), (C), (D),
                                             or (E) if no hours were entered in             director, trustee, or key employee
end-of-the-year figure on line 73,                                                          (defined above), during the tax year or,
column (B) must agree with the figure        column (B) and no compensation,
                                             contributions, expenses, and other             if using the calendar year, at any time
on line 21 of Part I.                                                                       during the calendar year or tax year.
                                             allowances were paid during the
                                             reporting period, or deferred for              Column (B)
Line 74. Total Liabilities and Net           payment to a future reporting period.
                                                                                            In column (B), a numerical estimate of
Assets/Fund Balances                            Aid in the processing of the                the average hours per week devoted to
Enter the total of lines 66 and 73. This     organization’s return by grouping              the position is required for a complete
amount must equal the amount for total       together, preferably at the end of its list,   answer. Statements such as “as
assets reported on line 59 for both the      those who received no compensation.            needed,” “as required,” or “40+” are
beginning and end of the year.               Be careful not to repeat names.                unacceptable.
                                                                -40-                             Specific Instructions for Form 990
Column (C)                                    defined below). For this purpose,            • Relationship 3. The organizations
For each person listed, report salary,        compensation includes any amount that        have a relationship as supporting and
fees, bonuses, and severance                  would be reportable in columns (C),          supported organizations under section
payments paid. Include current-year           (D), and (E) of Form 990, Part V-A, if       509(a)(3) (see Example 1, later).
payments of amounts reported or               provided by the organization. See            • Relationship 4. The organizations
reportable as deferred compensation in        General Instruction X regarding due          use a common paymaster. For a
any prior reporting period.                   diligence requirements to determine          definition of common paymaster and
                                              business relationships.                      illustrated examples, see Regulations
Column (D)                                    Required attachment. If the                  section 31.3121(s)-1(b).
Include in this column all forms of           organization answered “Yes,” it must         • Relationship 5. The other
deferred compensation and future              attach a schedule that lists, for each       organization pays part of the
severance payments (whether or not            officer, director, trustee, key employee,    compensation that the organization
funded; whether or not vested; and            highest compensated employee, or             would otherwise be contractually
whether or not the deferred                   highest compensated professional or          obligated to pay (see Example 2, later).
compensation plan is a qualified plan         other independent contractor, the            • Relationship 6. The organizations
under section 401(a)). Include also           information requested in 1 and 2,            conduct joint programs or share
payments to welfare benefit plans on          below.                                       facilities or employees.
behalf of the officers, directors, etc.           1. For Relationships 1 through 5,            Ownership. The term ownership is
Such plans provide benefits such as           provide:                                     holding (directly or indirectly) 50% or
medical, dental, life insurance,                                                           more of the voting power in a
severance pay, disability, etc.                   a. The name of the officer, director,    corporation, profits interest in a
Reasonable estimates may be used if           etc., receiving compensation from a          partnership, or beneficial interest in a
precise cost figures are not readily          related organization or organizations;       trust.
available.                                        b. The name and EIN of each
                                              related organization that provided the           Control. The term control is having
   Unless the amounts were reported in        compensation;                                50% or more of the voting power in a
column (C), report, as deferred                   c. A description of the relationship     governing body, or the power to appoint
compensation in column (D), salaries          between the organization and the             50% or more of an organization’s
and other compensation earned during          related organization(s); and                 governing body, or the power to
the reporting period, but not yet paid by         d. The amount of compensation            approve an organization’s budgets or
the date the organization files its return.   each related organization provided. Use      expenditures (an effective veto power
Column (E)                                    the same format as required by               over the organization’s budgets and
                                              columns (C) through (E) of Part V-A.         expenditures). Also, control can be
Enter both taxable and nontaxable                                                          indirect by owning or controlling another
                                                  2. If the organizations are related
fringe benefits (other than de minimis                                                     organization with such power.
                                              only by Relationship 6 or if the
fringe benefits described in section
                                              Volunteer exception to Relationship 2            The term governing body is defined
132(e)). Include expense allowances or
                                              applies, report the following information,   by the relevant state law. Generally, the
reimbursements that the recipients
                                              but do not report compensation paid by       governing body of a corporation is its
must report as income on their separate
                                              the related organization(s).                 board of directors and the governing
income tax returns. Examples include
amounts for which the recipient did not           a. The name of the officer, director,    body of a trust is its board of trustees.
account to the organization or                etc., receiving compensation from a          Reporting exceptions. The following
allowances that were more than the            related organization(s);                     exceptions apply:
payee spent on serving the                        b. The name and EIN of each              • Bank or financial institution
organization. Include payments made           related organization that provided such      trustee exception. If the organization
under indemnification arrangements,           compensation; and                            and the other organization are related
the value of the personal use of                  c. A description of the relationship     only because they are both controlled
housing, automobiles, or other assets         between the organization and the             by a common trustee that is a bank or
owned or leased by the organization (or       related organization(s).                     financial institution, the organization
provided for the organization’s use                                                        does not need to report either the
without charge), as well as any other         Reporting compensation. Report               relationship or the trustee’s
taxable and nontaxable fringe benefits.       compensation paid by a related               compensation from the related
See Pub. 525 for more information.            organization for only that time period       organization.
                                              during which a relationship existed          • Common independent contractor
Line 75b. Business                            between the organization and the             exception. If an independent contractor
Relationships                                 related organization. Report                 listed in Schedule A, Part II-A or II-B
For a definition of family and business       compensation paid by a related               does not exercise substantial influence,
relationships, see Family relationships       organization in the same period (either      as defined in section 4958(f)(1) and
and Business relationships on line 51 of      calendar or fiscal year) as the              Regulations section 53.4958-3 (treating
these instructions.                           organization reports compensation it         the organization as though it were an
                                              paid.                                        applicable tax-exempt organization
Line 75c. Compensation from                   Definition of related organization.          under section 4958(e)), over either the
Related Organizations                         Organizations may be related in several      organization or the related organization,
Answer “Yes,” to this question if any of      ways; the relationships are not mutually     the organization does not need to
the organization’s listed officers,           exclusive. Related organizations are         report either the relationship or the
directors, trustees, key employees,           tax-exempt or taxable organizations          independent contractor’s compensation
highest compensated employees, or             related to the tax-exempt organization       from the related organization. However,
highest compensated professional or           in one or more of the following ways.        this exception does not apply to a
other independent contractors received        • Relationship 1. One organization           management services company that
aggregate compensation amounts of             owns or controls the other organization.     performs for the organization functions
$50,000 or more from the organization         • Relationship 2. The same person(s)         similar to those of president, chief
and all related organizations (as             owns or controls both organizations.         executive officer, chief operating officer,
Specific Instructions for Form 990                              -41-
treasurer, or chief financial officer.        B. Because Organization A is paying to     exception earlier, the relationship
Compensation paid by a related                Bob a portion of Bob’s compensation        between Company Y and Organization
organization to such a management             that Organization B would otherwise be     B, and Company Y’s compensation
company must be reported by the               contractually committed to pay,            from Organization B for such janitorial
organization unless another exception         Organizations A and B are related          services is not reported by Organization
applies. See Examples 4 and 5 later.          organizations for Form 990 reporting       A.
• Volunteer exception. If Relationship        purposes. Organization B must report
                                                                                            None of Organization A’s officers,
2 is met only because the same                the payment from Organization A to
                                                                                         directors, etc., receive compensation
individuals control both the tax-exempt       Bob in an attachment to line 75c. If,
                                                                                         from Organization B. In conclusion,
organization and a for-profit                 instead, Organization B reimbursed
                                                                                         Organization A does not report its
organization that is not owned or             Organization A for a portion of Bob’s
                                                                                         relationship with Organization B in an
controlled directly or indirectly by one or   compensation and all of Bob’s
                                                                                         attachment to line 75c, and
more tax-exempt organizations, and            compensation was reported as paid by
                                                                                         Organization A answers “No” on line
none of the Relationships described in        Organization A, then Relationship 5
                                                                                         75c.
1 or 3 through 5 are met, then the            would not apply.
tax-exempt organization does not have             Example 3. Tom is the sole trustee        Example 5. The facts are the same
to report the compensation from the           of Organization A, a tax-exempt            as in Example 4, except that one of
for-profit organization of any persons        organization, and Organization B, a        Organization A’s officers, Sue, receives
serving the tax-exempt organization as        for-profit taxable organization wholly     compensation from Organization B.
a volunteer without compensation other        owned by Tom. So, Organizations A          Organization A must report in an
than reimbursement of expenses under          and B are related under Relationship 2     attachment to line 75c its relationship
an accountable plan (treating the             because they are controlled by the         with Organization B, and Sue’s
volunteer as an employee for this             same person. In this situation, Tom’s      compensation from Organization B for
purpose). See Example 3 later).               compensation from Organization B (as       services provided to Organization B.
                                              well as the name and EIN of                Even though Organization A must
        Providing information on
                                              Organization B, and a description of the   report Sue’s compensation from
 TIP compensation received from                                                          Organization B, Organization A does
        related organizations does not        relationship between the two
                                              organizations) is reported in an           not report Company Y’s compensation
violate the disclosure provisions of
                                              attachment to line 75c of Organization     from Organization B because of the
section 7216(a). See also section
                                              A’s Form 990.                              Common independent contractor
6033(a)(1).
                                                                                         exception.
Examples illustrating relationships.              However, if Tom serves
    Example 1. X, a hospital auxiliary,       Organization A without compensation
raises funds for Hospital Y. Z, another       and none of the other relationships        Part V-B. Former Officers,
hospital auxiliary, coordinates the           described in 1 or 3 through 5 are met,
                                              then because of the Volunteer              Directors, Trustees, and Key
efforts of Hospital Y’s volunteer staff.
Both X and Z are supporting                   exception, Tom’s compensation from         Employees That Received
organizations of Hospital Y and are           Organization B is not reported by          Compensation or Other
                                              Organization A. However, the
considered related organizations to
                                              relationship between Organization A
                                                                                         Benefits
Hospital Y. Hospital Y is also                                                           List each former officer, director,
considered a supported organization of        and Organization B must be reported.
                                                                                         trustee, and key employee (as defined
the auxiliaries.                                  Example 4. Organization A is filing
                                                                                         in Part V-A) of the organization or
    Hospital Y must report (in an             its Form 990. Organization B is a
                                                                                         disregarded entity described in
attachment to line 75c) the                   taxable subsidiary of Organization A;
                                                                                         Regulations sections 301.7701-1
compensation, if any, paid by each of         so, Organizations A and B are related
                                                                                         through 301.7701-3 that received
the auxiliaries to the officers, directors,   under Relationship 1 because A
                                                                                         compensation or other benefits during
trustees, or key employees listed in the      controls B.
                                                                                         the reporting year. A reasonable effort
hospital’s Form 990, Part V-A, or                 Organization A contracts with          should be made to determine whether
highest-compensated employees listed          Company Y for janitorial services.         any persons that were paid
in the hospital’s Schedule A, Part I, or      Company Y is listed as one of              compensation or held loans are former
highest-compensated professional or           Organization A’s highest-compensated       officers, etc. Do not list persons in Part
other independent contractors listed in       independent contractors. Organization      V-B that are listed in Part V-A, even if
the hospital’s Schedule A, Part II-A or       B also contracts with Company Y for        they were former officers, etc. for part
II-B. Both X and Z must report (in an         janitorial services. Company Y is not a    of the year.
attachment to line 75c) the                   35% controlled entity of a disqualified
compensation, if any, paid by Hospital        person for organization A or                  For purposes of reporting all
Y to an officer, director, etc., of the       Organization B. So, Company Y is           amounts in columns (B) through (E) in
auxiliary.                                    listed in Organization A’s Schedule A,     Part V-B, either use the organization’s
                                              Part II-B, and Company Y also receives     tax year, or the calendar year ending
    Example 2. Bob, a key employee                                                       within such tax year.
of Organization B, a 501(c)(4) social         compensation from Organization B,
welfare organization, conducts                which is related to Organization A.           Give the preferred address at which
fundraising among Organization B’s                However, Company Y meets the           these former officers, directors, etc.,
members, with the proceeds going to           requirements of the Common                 want the Internal Revenue Service to
Organization A, a 501(c)(3) public            independent contractor exception,          contact them.
charity, to carry out disaster relief. The    earlier. Company Y is not considered to
                                                                                           Use an attachment if there are more
Chief Executive Officers (CEOs) of            exercise substantial influence over
                                                                                         persons to list in Part V-B.
Organizations A and B agree that              either Organization A or Organization B
Organization A will pay a portion of          if they were applicable tax-exempt           Show all forms of cash and noncash
Bob’s salary for a period of time in          organizations within the meaning of        compensation or benefits received by
recognition of Bob’s role in the              section 4958(e). Because of the            each listed former officer, director, etc.,
fundraising assistance of Organization        Common independent contractor              whether paid currently or deferred.
                                                               -42-                           Specific Instructions for Form 990
    If the organization pays any other       and other compensation earned during        authorized to sign for the organization,
person, such as a management                 the period covered by the return, but       certifying that they are complete and
services company, for the services           not yet paid by the date the                accurate copies of the original
provided by any of its former officers,      organization files its return.              documents.
directors, trustees, or key employees,                                                      Photocopies of articles of
report the compensation and other            Column (E)
                                                                                         incorporation showing the certification
items in Part V-B as if the organization     Enter both taxable and nontaxable           of an appropriate state official do not
had paid the former officers, directors,     fringe benefits (other than de minimis      have to be accompanied by such a
etc., directly.                              fringe benefits described in section        declaration. See Rev. Proc. 68-14,
    A failure to fully complete Part V-B     132(e)). Include expense allowances or      1968-1 C.B. 768, for details. When a
can subject both the organization and        reimbursements that the recipients          number of changes are made, attach a
the individuals responsible for such         must report as income on their separate     copy of the entire revised organizing
failure to penalties for filing an           income tax returns. Examples include        instrument or governing document.
incomplete return. See General               amounts for which the recipient did not
                                             account to the organization or                 However, if the exempt organization
Instruction K. In particular, entering the                                               changes its legal structure, such as
phrase on Part V-B, “Information             allowances that were more than the
                                             payee spent on serving the                  from a trust to a corporation, it must file
available upon request,” or a similar                                                    a new exemption application to
phrase, is not acceptable.                   organization. Include payments made
                                             under indemnification arrangements,         establish that the new legal entity
    The organization may also provide        the value of the personal use of            qualifies for exemption.
an attachment to explain the entire          housing, automobiles, or other assets
2007 compensation package for any                                                        Line 78. Unrelated Business
                                             owned or leased by the organization (or
person listed in Part V-B.                   provided for the organization’s use
                                                                                         Income
    Each person listed in Part V-B           without charge), as well as any other       Political organizations described in
should report the listed compensation        taxable and nontaxable fringe benefits.     section 527 are not required to answer
on his or her income tax return unless       See Pub. 525 for more information.          this question.
the Code specifically excludes any of                                                        Check “Yes” on line 78a if the
the payments from income tax. See                                                        organization’s total gross income from
Pub. 525 for details.                        Part VI—Other Information                   all of its unrelated trades and
Column (A)                                   • Section 501(c)(3) organizations and       businesses is $1,000 or more for the
                                             section 4947(a)(1) nonexempt                year. Gross income is the amount of
Report the name and address of each          charitable trusts must also complete        gross receipts less the cost of goods
person who was a former officer,             and attach a Schedule A (Form 990 or        sold. See Pub. 598 for a description of
director, trustee, or key employee           990-EZ) to their Form 990 or Form           unrelated business income and the
(defined in Part V-A) at any time during     990-EZ. See General Instruction D for       Form 990-T filing requirements for
the calendar year.                           information on Schedule A (Form 990         section 501(c), (e), (f), (k), and (n)
Column (B)                                   or 990-EZ).                                 organizations having such income.
In column (B), report all secured and
                                             • Answer “Yes,” or “No,” to each            Form 990-T is not a substitute for
                                             applicable question.                        Form 990. Report on Form 990, or
unsecured loans and salary advances
to former officers, directors, trustees,     Line 76. Change in Activities               Form 990-EZ, items of income and
and key employees. For credit unions,                                                    expense that are also reported on Form
                                             Attach a statement to explain any           990-T when the organization is required
report only loans not made on the same       changes during the past 3 years in the
terms as for all other members.                                                          to file both forms.
                                             activities the organization conducts to
Column (C)                                   further its exempt purpose, or in the                All tax-exempt organizations
For each person listed, report salary,       methods of conducting these activities.
                                             However, if a change has been
                                                                                           !      must pay estimated taxes for
                                                                                          CAUTION their unrelated business income
fees, bonuses, and severance
payments paid. Include current-year          reported to the IRS on a previously filed   if they expect their tax liability to be
payments of amounts reported or              attachment, do not report the change        $500 or more. Use Form 990-W to
reportable as deferred compensation in       again. An activity previously listed as     compute this tax.
any prior year.                              current or planned in the organization’s
                                             application for recognition of exemption    Line 79. Liquidation,
Column (D)                                   does not have to be reported unless the     Dissolution, Termination, or
Include in this column all forms of          method of conducting such activity has      Substantial Contraction
deferred compensation and future             changed. Also, include any major            For a complete liquidation of a
severance payments (whether or not           program activities that are being           corporation or termination of a trust,
funded; whether or not vested; and           discontinued.                               check the Termination box in the
whether or not the deferred                                                              heading on page 1 of the form. If there
compensation plan is a qualified plan
                                             Line 77. Changes In Organizing              was a liquidation, dissolution,
under section 401(a)). Include also          or Governing Documents                      termination, or substantial contraction,
payments to welfare benefit plans on         Attach a conformed copy of any              attach a statement explaining what took
behalf of the officers, directors, etc.      changes to the articles of incorporation,   place.
Such plans provide benefits such as          or association, constitution, trust            On the attached statement, show
medical, dental, life insurance,             instrument, or other organizing             whether the assets have been
severance pay, disability, etc.              document, or to the bylaws or other         distributed and the date of distribution.
Reasonable estimates may be used if          governing document.                         Also attach a certified copy of any
precise cost figures are not readily            A conformed copy is one that agrees      resolution, or plan of liquidation or
available.                                   with the original document and all          termination, etc., with all amendments
   Unless the amounts were reported in       amendments to it. If the copies are not     or supplements not already filed. In
column (C), report, as deferred              signed, they must be accompanied by a       addition, attach a schedule listing the
compensation in column (D), salaries         written declaration signed by an officer    names and addresses of all persons
Specific Instructions for Form 990                             -43-
who received the assets distributed in        organization, or the election of             • Remuneration to such individual (a
liquidation or termination, the kinds of      Presidential or Vice Presidential            candidate or prospective candidate) for
assets distributed to each one, and           electors. It does not matter whether the     speeches or other services;
each asset’s fair market value.               attempt succeeds.                            • Travel expenses of such individual;
   A substantial contraction is a partial         An expenditure includes a payment,       • Expenses of conducting polls,
liquidation or other major disposition of     distribution, loan, advance, deposit, or     surveys, or other studies, or preparing
assets except transfers for full              gift of money, or anything of value. It      papers or other material for use by
consideration or distributions from           also includes a contract, promise, or        such individual;
current income.                               agreement to make an expenditure,            • Expenses of advertising, publicity,
                                              whether or not legally enforceable.          and fundraising for such individual; and
   A major disposition of assets is any                                                    • Any other expense that has the
disposition for the tax year that is:         All section 501(c) organizations. An         primary effect of promoting public
    1. At least 25% of the fair market        exempt organization that is not a            recognition or otherwise primarily
value of the organization’s net assets at     political organization must file Form        accruing to the benefit of such
the beginning of the tax year; or             1120-POL if it is treated as having          individual.
    2. One of a series of related             political organization taxable income
dispositions begun in earlier years that      under section 527(f)(1).                        An organization is effectively
add up to at least 25% of the net assets                                                   controlled by a candidate or prospective
                                                 If a section 501(c) organization          candidate only if such individual has a
the organization had at the beginning of      establishes and maintains a section
the tax year when the first disposition in                                                 continuing, substantial involvement in
                                              527(f)(3) separate segregated fund, it is    the day-to-day operations or
the series was made. Whether a major          the fund’s responsibility to file its own
disposition of assets took place through                                                   management of the organization.
                                              Form 1120-POL if the fund meets the
a series of related dispositions depends      Form 1120-POL filing requirements. Do            A determination of whether the
on the facts in each case.                    not include the segregated fund’s            primary purpose of an organization is
                                              receipts, expenditures, and balance          promoting the candidacy or prospective
   See Regulations section 1.6043-3                                                        candidacy of an individual for public
for special rules and exceptions.             sheet items on the Form 990, or Form
                                              990-EZ, of the section 501(c)                office is made on the basis of all the
Line 80. Relation To Other                    organization that establishes and            facts and circumstances. See section
Organizations                                 maintains the fund. When answering           4955 and Regulations section 53.4955.
Answer “Yes” if most (more than 50%)          questions 81a and 81b on its Form 990,          Use Form 4720 to figure and report
of the organization’s governing body,         this section 501(c) organization should      the excise taxes.
officers, directors, trustees, or             disregard the political expenses and
membership are also officers, directors,      Form 1120-POL filing requirement of          Line 82. Donated Services or
trustees, or members of any other             the segregated fund.                         Facilities
organization.                                     However, when a section 501(c)           Because Form 990, or Form 990-EZ, is
    Disregard any coincidental overlap        organization transfers its own funds, to     open to public inspection, the
of membership with another                    a separate segregated section 527(f)(3)      organization may want the return to
organization; that is, when membership        fund for use as political expenses, the      show contributions the organization
in one organization is not a condition of     501(c) organization must report the          received in the form of donated
membership in another organization.           transferred funds as its own political       services or the use of materials,
For example, assume that a majority of        expenses on its Form 990 or Form             equipment, or facilities at less than fair
the members of a section 501(c)(4)            990-EZ.                                      rental value. If so, and if the
civic organization also belong to a local     Section 501(c)(3) organizations. A           organization’s records either show the
chamber of commerce described in              section 501(c)(3) organization will lose     amount and value of such items or give
section 501(c)(6). The civic                  its tax-exempt status if it engages in       a clearly objective basis for an
organization should answer “No” on line       political activity.                          estimate, the organization may choose
80a if it does not require its members to                                                  to enter this optional information on line
belong to the chamber of commerce.                A section 501(c)(3) organization         82b. The IRS does not require any
                                              must pay a section 4955 excise tax for       organization to keep such records.
    Also, disregard affiliation with any      any amount paid or incurred on behalf
statewide or nationwide organization.                                                      However, do not include the value of
                                              of, or in opposition to, any candidate for   such items in Part I or II, or in the
Thus, the civic organization in the           public office. The organization must pay
above example would still answer “No”                                                      expense column in Part III. The
                                              an additional excise tax if it fails to      organization may indicate the value of
on line 80a even if it belonged to a          correct the expenditure timely.
state or national federation of similar                                                    donated services or use of materials,
organizations. A local labor union               A manager of a section 501(c)(3)          equipment, or facilities in Part III in the
whose members are also members of a           organization who knowingly agrees to a       narrative description of program
national labor organization would             political expenditure must pay a section     services rendered. See the instructions
answer “No” on line 80a.                      4955 excise tax, unless the agreement        for Part III.
                                              is not willful and there is reasonable
Line 81. Expenditures For                     cause. A manager who does not agree          Line 83a. Public Inspection
Political Purposes                            to a correction of the political             Requirements
                                              expenditure may have to pay an               Answer “Yes” only if the organization
          Political organizations described   additional excise tax.                       complied with its public inspection
  !       in section 527 are not required
          to answer this question.                When a section 501(c)(3)                 obligations described in General
CAUTION
                                              organization promotes a candidate for        Instruction M.
   A political expenditure is one             public office (or is used or controlled by   Line 83b. Disclosure
intended to influence the selection,          a candidate or prospective candidate),
nomination, election, or appointment of       amounts paid or incurred for the             Requirements For Quid Pro
anyone to a federal, state, or local          following purposes are political             Quo Contributions
public office, or office in a political       expenditures:                                See General Instruction L.
                                                                 -44-                           Specific Instructions for Form 990
Line 84a. Solicitations of                      d. Organizations described in 1           IF . . .                     THEN . . .
Contributions                                through 3, above.
                                                5. Section 501(c)(4) and (5)              The organization’s           The organization must:
All organizations that qualify under                                                      lobbying and political       (a) Allocate all
                                             organizations that receive more than
section 170(c) to receive contributions                                                   expenses are more than       membership dues to its
                                             90% of their annual dues from:               its membership dues for      lobbying and political
that are deductible as charitable
contributions for federal income tax            a. Persons,                               the year,                    activities, and
                                                b. Families, or                                                        (b) Carry forward any
purposes, enter “N/A.” See General                                                                                     excess lobbying and
Instruction L.                                   c. Entities who each paid annual                                      political expenses to the
                                             dues of $95 or less in 2007 (adjusted                                     next tax year.
Line 85. Section 501(c)(4), (5),             annually for inflation). See Rev. Proc.
or (6) Organizations                         2006-53 which is on page 996 of the          The organization:            The organization need
                                             Internal Revenue Bulletin 2006-48 at         (a) Had only de minimis      not disclose to its
Reporting membership dues,                   www.irs.gov/pub/irs-irbs/irb06-48.pdf        in-house expenses            membership the
lobbying, and political expenses                6. Any organization that receives a       ($2,000 or less) and no      allocation of dues, etc.,
under section 6033(e). Only certain          private letter ruling from the IRS stating   other nondeductible          to its lobbying and
organizations that are tax-exempt                                                         lobbying or political        political activities.
                                             that the organization satisfies the          expenses; or
under:                                       section 6033(e)(3) exception.
• Section 501(c)(4) (social welfare             7. Any organization that keeps            (b) Paid a proxy tax,
organizations),                              records to substantiate that 90% or          instead of notifying its
• Section 501(c)(5) (agricultural and        more of its members cannot deduct            members on the
horticultural organizations), or             their dues (or similar amounts) as           allocation of dues to
• Section 501(c)(6) (business leagues)       business expenses whether or not any
                                                                                          lobbying and political
are subject to (a) the section 6033(e)                                                    expenses*; or
                                             part of their dues are used for lobbying
notice and reporting requirements, and       purposes.                                    (c) Established that
(b) a potential proxy tax. These                8. Any organization that is not a         substantially all of its
organizations must report their total        membership organization.                     membership dues, etc.,
lobbying expenses, political expenses,                                                    are not deductible by
and membership dues, or similar                                                           members.
amounts, on line 85 of Form 990.                     Special rules treat affiliated       *Such as political campaign or grassroots lobbying
   Section 6033(e) notice and                  !     social welfare organizations,
                                             CAUTION agricultural and horticultural
                                                                                          expenses.

reporting requirements and proxy             organizations, and business leagues as
tax. Section 6033(e) requires certain        parts of a single organization for              Members of the organization cannot
section 501(c)(4), (5), and (6)              purposes of meeting the nondeductible        take a trade or business expense
organizations to tell their members what     dues exception. See Rev. Proc. 98-19.        deduction on their tax returns for the
portion of their membership dues were                                                     portion of their dues, etc., allocable to
allocable to the political or lobbying       Exception 2. Section 6033(e)(1)              the organization’s lobbying and political
activities of the organization. If an        $2,000 in-house lobbying exception.          activities.
organization does not give its members       (Check “Yes” for line 85b.) An
                                             organization satisfies the $2,000            Proxy tax.
this information, then the organization is
subject to a proxy tax. The tax is           in-house lobbying exception if it:           IF . . .                     THEN . . .
reported on Form 990-T.                          1. Did not receive a waiver for proxy
   However, if the organization meets        tax owed for the prior year,                 The organization’s           The organization is
Exception 1 or 2, it is excluded from the        2. Did not make any political            actual lobbying and          liable for a proxy tax on
                                             expenditures or foreign lobbying             political expenses are       the excess and reports it
notice, reporting, and proxy tax                                                          more than it estimated       on Form 990-T.
requirements of section 6033(e). See         expenditures during the 2007 reporting       in its dues notices,
also Rev. Proc. 98-19, 1998-1 C.B.           year, and
547.                                             3. Made lobbying expenses during         The organization:            All the members’ dues
                                             the 2007 reporting year consisting only      (a) Elects to pay the        remain eligible for a
Exception 1. Section 6033(e)(3)              of in-house direct lobbying expenses         proxy tax, and               section 162 trade or
exception for organizations whose            totaling $2,000 or less, but excluding:      (b) Chooses not to give      business expense
dues are nondeductible. (Check “Yes”                                                      its members a notice         deduction.
for line 85a.)                                   a. Any allocable overhead                allocating dues to
                                             expenses, and                                lobbying and political
    1. All organizations exempt from tax         b. All direct lobbying expenses of       activities,
under section 501(a), other than section     any local council regarding legislation of
501(c)(4), (5), and (6) organizations.       direct interest to the organization or its   The organization:         The IRS may permit a
    2. Local associations of employees’      members.                                     (a) Makes a reasonable waiver of the proxy tax.
and veterans’ organizations described                                                     estimate of dues
in section 501(c)(4), but not section                                                     allocable to
                                             Dues notices. An organization that           nondeductible lobbying
501(c)(4) social welfare organizations.      checked “No” for both lines 85a and          and political activities,
    3. Labor unions and other labor          85b, and is thus responsible for             and
organizations described in section           reporting on line 85c through 85h, must      (b) Agrees to adjust its
501(c)(5), but not section 501(c)(5)         send dues notices to its members at          estimate in the following
agricultural and horticultural                                                            year*.
                                             the time of assessment or payment of
organizations.                               dues, unless the organization chooses        *A facts and circumstances test determines whether or
    4. Section 501(c)(4), (5), and (6)       to pay the proxy tax instead of              not a reasonable estimate was made in good faith.
organizations that receive more than         informing its members of the
90% of their dues from:                      nondeductible portion of its dues.           Allocation of costs to lobbying
    a. Section 501(c)(3) organizations,      These dues notices must reasonably           activities and influencing legislation.
    b. State or local governments,           estimate the dues allocable to the            An organization that is subject to the
    c. Entities whose income is exempt       nondeductible lobbying and political         lobbying disclosure rules of section
from tax under section 115, or               expenditures reported on line 85d.           6033(e) must use a reasonable
Specific Instructions for Form 990                              -45-
allocation method to determine its total      and that otherwise qualifies as a
costs of its direct lobbying activities;      lobbying activity.                            X Organization allocated its lobbying
that is, costs to influence:                                                                costs as follows:
• Legislation, and                               Treat all hours spent by a person in
• The actions of a covered executive          connection with direct contact lobbying       Lobbying
                                                                                            labor hrs.
branch official through direct                as labor hours allocable to lobbying          3,000
                                                                                                           ×   $300,000       +        0         = $150,000
communication (for example, President,        activities.                                   6,000
                                                                                            Total labor        Total              Allocable         Costs
Vice President, or cabinet-level officials,      Do not treat the hours spent by a          hrs.               costs of           third-party       allocable to
and their immediate deputies) (sections       person who engages in research and                               operations         costs             lobbying
                                                                                                                                                    activities
162(e)(1)(A) and (D)).                        other background activities related to
   Reasonable methods of allocating           direct contact lobbying, but who makes        Examples: Gross-up method and
costs to direct lobbying activities           no direct contact with a legislator, or       Alternative gross-up method.
include, but are not limited to:              covered executive branch official, as         A and B are employees of Y
• The ratio method,                           direct contact lobbying.                      Organization.
• The gross-up and alternative                   De minimis rule. If less than 5% of           1. A’s activities involve significant
gross-up methods, and                         a person’s time is spent on lobbying          judgment with respect to lobbying
• A method applying the principles of         activities, and there is no direct contact    activities.
section 263A.                                 lobbying, an organization may treat that         2. A’s basic lobbying labor costs
   See Regulations sections 1.162-28          person’s time spent on lobbying               (excluding employee benefits) are
and 1.162-29 and the special rules and        activities as zero.                           $50,000.
definitions for these allocation methods                                                       3. B performs clerical and support
given below.                                     Influencing legislation is:                activities for A.
                                              • Any attempt to influence legislation           4. B’s labor costs (excluding
   An organization that is subject to the     through a lobbying communication; and         employee benefits) in support of A’s
lobbying disclosure rules of section          • All activities, such as research and        activities are $15,000.
6033(e) must also determine its total         coordination for the purpose of making
costs of:                                                                                      5. Allocable third-party costs are
                                              or supporting a lobbying
• De minimis in-house lobbying,               communication, even if not yet made.
                                                                                            $100,000.
• Grassroots lobbying, and                                                                      If Y Organization uses the gross-up
• Political activities.                          A lobbying communication is any
                                                                                            method to allocate its lobbying costs, Y
There are no special rules related to         communication with any member or
                                              employee of a legislative body, or any        multiplies 175% times its basic labor
determining these costs.                                                                    costs (excluding employee benefits) for
                                              other government official participating in
   All methods. For all the allocation        the formulation of the legislation that:      all of the lobbying of its personnel and
methods, include labor hours and costs        • Refers to specific legislation and          adds its allocable third-party lobbying
of personnel whose activities involve         reflects a view on that legislation, or       costs as follows:
significant judgment with respect to          • Provides support for views in a prior       175% × $65,000         + $100,000              = $213,750
lobbying activities (lobbying personnel).     lobbying communication.                       Basic lobbying labor       Allocable                Costs allocable
                                                                                            costs of A + B             third-party costs        to lobbying
                                                  Purpose for engaging in an                                                                    activities
Special rules and definitions.                activity is based on all the facts and
   Ratio and gross-up methods.                circumstances. If an organization’s               If Y Organization uses the alternative
                                              lobbying communication was for a              gross-up method to allocate its lobbying
   1. May use even if volunteers                                                            costs, Y multiplies 225% times its basic
conduct activities.                           lobbying and a nonlobbying purpose,
                                              the organization must make a                  labor costs (excluding employee
   2. May disregard labor hours and                                                         benefits) for all of the lobbying hours of
costs of clerical or support personnel        reasonable allocation of costs to
                                              influencing legislation.                      its lobbying personnel and adds its
(other than lobbying personnel) under                                                       third-party lobbying costs as follows:
the ratio method.                                Correction of prior year lobbying
                                                                                            225% × $50,000         +   $100,000            = $212,500
                                              costs. If in a prior year, an
    Alternative gross-up method.              organization treated costs incurred for a     Basic lobbying labor       Allocable                Costs allocable
• Disregard labor hours, and                  future lobbying communication as a
                                                                                            costs of A                 third-party costs        to lobbying
                                                                                                                                                activities
• Costs of clerical or support personnel      lobbying cost to influence legislation,
(other than lobbying personnel).              but after the organization filed a timely     Section 263A cost allocation
                                              return, it appears the lobbying               method. The examples that
    Third-party costs are those paid
                                              communication will not be made under          demonstrate this method are found in
to:
                                                                                            Regulations section 1.162-28(f).
• Outside parties for conducting              any foreseeable circumstance, the
lobbying activities,                          organization may apply these costs to         Line 85a. Section 6033(e)(3)
• Dues paid to another membership             reduce its current year’s lobbying costs,     Exception For Nondeductible
organization that were declared to be         but not below zero. The organization
                                              may carry forward any amount of the
                                                                                            Dues
nondeductible lobbying expenses, and
• Travel and entertainment costs for          costs not used to reduce its current          If the organization meets any of the
lobbying activities.                          year’s lobbying costs to subsequent           criteria of Exception 1 in the line 85
                                              years.                                        instructions, answer “Yes” to question
    Direct contact lobbying is a:                                                           85a. By doing so, the organization is
• Meeting,                                    Example: Ratio method. X                      declaring that substantially all of its
• Telephone conversation,                     Organization incurred:                        membership dues were nondeductible.
• Letter, or                                     1. 6,000 labor hours for all activities,   Skip lines 85b through 85h.
• Similar means of communication that            2. 3,000 labor hours for lobbying
is with a:                                    activities (three employees),                 Line 85b. In-House Lobbying
    1. Legislator (other than a local            3. $300,000 for operational costs,         Expenditures
legislator), or                               and                                           An organization is exempt from the
    2. Covered executive branch official         4. No third-party lobbying costs.          notice, reporting, and proxy tax liability
                                                                 -46-                               Specific Instructions for Form 990
rules of section 6033(e) if it meets            The term dues is the amount the             Example:
Exception 2, the $2,000 in-house             organization requires a member to pay          • Membership dues: $100,000 for the
lobbying exception. Both exceptions are      in order to be recognized as a member.         2007 reporting year,
discussed in the instructions for line 85.      Payments that are similar to dues           • Organization’s timely notices to
    An organization should answer “Yes”      include:                                       members — 25% of membership dues
to question 85b if it met all of the                                                        nondeductible, and
requirements of Exception 2. Skip lines
                                                 1. Members’ voluntary payments,            • Line 85e entry — $25,000.
                                                 2. Assessments to cover basic
85c through 85h.                             operating costs, and                           Line 85f. Taxable Lobbying and
    If the organization’s in-house direct        3. Special assessments to conduct          Political Expenditures
lobbying expenditures during the 2007        lobbying and political activities.             The taxable amount reportable on line
reporting year were $2,000 or less, but                                                     85f is the amount of dues, etc.:
the organization also paid or incurred       Line 85d. Lobbying and                            1. Allocable to the 2007 reporting
other lobbying or political expenditures     Political Expenditures                         year, and
during the 2007 reporting year, or           Include on line 85d the total amount of           2. Attributable to lobbying and
received a waiver for proxy tax owed         expenses paid or incurred during the           political expenditures that the
for the prior year, it should answer “No”    2007 reporting year in connection with:        organization did not timely notify its
to question 85b and complete lines 85c                                                      members were nondeductible.
through 85h. However, the $2,000 or              1. Influencing legislation;
less of in-house direct lobbying                 2. Participating or intervening in any
                                             political campaign on behalf of (or in            If the amount on line 85c (dues, etc.)
expenditures should not be included in                                                      is greater than the amount on line 85d
the total on line 85d.                       opposition to) any candidate for any
                                             public office;                                 (lobbying & political expenses), then:
Definitions.                                     3. Attempting to influence any
                                                                                                Line 85d (lobbying & political expenses)
    Grassroots lobbying refers to            segment of the general public with                                  Less
attempts to influence any segment of         respect to elections, legislative matters,
the general public regarding legislative     or referendums; or                                    Line 85e (dues shown in notices)
matters or referendums.                          4. Communicating directly with a                                Equals
    Direct lobbying includes                 covered executive branch official in an
                                                                                            Line 85f (taxable lobbying & political expenses)
attempting to influence:                     attempt to influence the official actions
• Legislation through communication          or positions of such official.                     If the amount on line 85c (dues, etc.)
with legislators and other government                                                       is less than the amount on line 85d
                                                Also include on line 85d:                   (lobbying & political expenses), then:
officials, and
• The official actions or positions of          1. Excess lobbying and political
covered executive branch officials           expenditures carried over from the                           Line 85c (dues, etc.)
                                             preceding tax year.                                                 Less
through direct communication.
                                                2. An amount equal to the taxable                  Line 85e (dues shown in notices)
    Direct lobbying does not include         lobbying and political expenditures
attempting to influence:                     reported on line 85f for the preceding                              Equals
• Any local council on legislation of        tax year, if the organization received a             Line 85f (taxable lobbying & political
direct interest to the organization or its   waiver of the proxy tax imposed on that                         expenses), and
members, and                                 amount.
• The general public regarding                                                                  Line 85d (lobbying & political expenses)
legislative matters (grassroots              Do not include:                                                     Less
lobbying).                                      1. Any direct lobbying of any local                       Line 85c (dues, etc.)
    Other lobbying includes:                 council or similar governing body with
• Grassroots lobbying,                       respect to legislation of direct interest to
                                                                                                                 Equals
• Foreign lobbying,                          the organization or its members.               The excess amount to be carried over to the
• Third-party lobbying, and                     2. In-house direct lobbying                 following tax year and reported on line 85d
• Dues paid to another organization          expenditures, if the total of such             (lobbying & political expenses), or its
                                                                                            equivalent, on the year 2008 Form 990.
that were used to lobby.                     expenditures is $2,000 or less
    In-house expenditures include:           (excluding allocable overhead).                   See Examples given below.
• Salaries, and                                 3. Political expenditures for which
• Other expenses of the organization’s       the section 527 tax has been paid (on          Lines 85g and 85h. Proxy Tax
officials and staff (including amounts       Form 1120-POL).                                and Waivers
paid or incurred for the planning of         • Reduce the current year’s lobbying           An organization must pay the section
legislative activities).                     expenditures, but not below zero, by           6033(e) proxy tax on the amount
    In-house expenditures do not             costs previously allocated in a prior          reported on line 85f unless it has the
include:                                     year to lobbying activities that were          option to check “Yes” on line 85h.
• Any payments to other taxpayers            cancelled after a return reporting those       If the amount on line 85f is zero, or less than
engaged in lobbying or political             costs was filed.                               zero, enter on:
activities as a trade or business.           • Carry forward any amounts not used               Line 85g             N/A
• Any dues paid to another                   as a reduction to subsequent years.                Line 85h             N/A
organization that are allocable to
lobbying or political activities.            Line 85e. Dues Declared
                                             Nondeductible In Notices To                    If the organization sent dues notices to its
Line 85c. Dues, Assessments,                 Members                                        members at the time of assessment or
                                                                                            payment of dues that reasonably estimated the
and Similar Amounts Received                 Enter the total amount of dues, etc.,          dues allocable to the nondeductible lobbying
Enter the total dues, assessments, and       allocable to the 2007 reporting year that      and political expenditures reported on line 85d,
similar amounts allocable to the 2007        members were notified were                     enter on:
reporting year.                              nondeductible under section 162(e).
Specific Instructions for Form 990                              -47-
   Line 85g                      No                             received in 2007 were less than its                           the income shown on line 86b on the
   Line 85h                      Yes                            lobbying expenses for 2007.                                   club’s Form 990-T.
Include the amount from the 2007 Form 990,                      Workpapers (for 2007 Form 990) —                                 Investment income earned by a
line 85f, on the year 2008 Form 990, line 85d,                  Organization B                                                section 501(c)(7) organization is not
or its equivalent.                                              1. Total dues, assessments, etc.,                             tax-exempt income unless it is set aside
                                                                   received . . . . . . . . . . . . . . . . . . $400          for:
If the organization did not send these dues
                                                                2. Lobbying expenses paid or incurred                  $600   • Religious,
notices, enter on:                                              3. Less: Total nondeductible amount of                        • Charitable,
    Line 85g              Yes
                                                                   dues notices . . . . . . . . . . . . . . .   100    100    • Scientific,
    Line 85h              No                                    4. (Subtract line 3 from both lines 1 and                     • Literary,
                                                                   2) . . . . . . . . . . . . . . . . . . . . . $300   $500
                                                                                                                              • Educational purposes, or
Report the proxy tax on Form 990-T.                             5. Taxable amount of lobbying expenses
                                                                   (smaller of the two amounts on line 4) $300
                                                                                                                              • Prevention of cruelty to children or
                                                                                                                              animals.
Underreporting of lobbying                                                                                                         If the combined amount of an
expenses. An organization is subject                                       The amounts on lines 1, 2, 3,
                                                                  TIP and 5 of the workpapers were                            organization’s gross investment income
to the proxy tax for the 2007 reporting                                                                                       (that is not set aside for charitable
year for underreported lobbying and                                     entered on lines 85c through 85f
                                                                of the 2007 Form 990.                                         purposes) and other unrelated business
political expenses only to the extent                                                                                         income exceeds $1,000, it must report
that these expenses (if actually                                    Because dues, etc., received were                         the investment income and other
reported) would have resulted in a                              less than lobbying expenses, excess                           unrelated business income on Form
proxy tax liability for that year. A waiver                     lobbying expenses of $200 must be                             990-T.
of proxy tax for the tax year only                              carried forward to line 85d of the year
applies to reported expenditures.                                                                                             Nondiscrimination policy. A section
                                                                2008 Form 990 (excess of $600 of                              501(c)(7) organization is not exempt
   An organization that underreports its                        lobbying expenses over $400 dues,                             from income tax if any written policy
lobbying and political expenses is also                         etc., received). The $200 will be                             statement, including the governing
subject to the section 6652(c) daily                            included along with the other lobbying                        instrument and bylaws, allows
penalty for filing an incomplete or                             and political expenses paid or incurred                       discrimination on the basis of race,
inaccurate return.                                              in the 2008 reporting year and                                color, or religion.
                                                                reportable on line 85d (or the
Examples                                                        equivalent line) of the year 2008 Form                           However, section 501(i) allows social
                                                                990.                                                          clubs to retain their exemption under
Organizations A and B:                                                                                                        section 501(c)(7) even though their
   1. Reported on the calendar year                               See the instructions for lines 85g                          membership is limited (in writing) to
basis.                                                          and 85h for the treatment of the $300.                        members of a particular religion, if the
   2. Incurred only grassroots lobbying                                                                                       social club:
expenses (did not qualify for the under
                                                                Line 86. Section 501(c)(7)
                                                                                                                                  1. Is an auxiliary of a fraternal
$2,000 in-house lobbying exception (de                          Organizations                                                 beneficiary society exempt under
minimis rule)).                                                 Gross receipts test. A section                                section 501(c)(8), and
   3. Allocated dues to the tax year in                         501(c)(7) organization may receive up                             2. Limits its membership to the
which received.                                                 to 35% of its gross receipts, including                       members of a particular religion; or the
                                                                investment income, from sources                               membership limitation is:
   For Organization A — Dues,                                   outside its membership and remain                                 a. A good-faith attempt to further the
assessments, and similar amounts                                tax-exempt. Part of the 35% (up to 15%                        teachings or principles of that religion,
received in 2007 were greater than its                          of gross receipts) may be from public                         and
lobbying expenses for 2007.                                     use of a social club’s facilities.                                b. Not intended to exclude
Workpapers (for 2007 Form 990) —                                   Gross receipts are the club’s income                       individuals of a particular race or color.
Organization A
                                                                from its usual activities and include:
1. Total dues, assessments, etc.,                               • Charges,                                                    Line 87. Section 501(c)(12)
   received . . . . . . . . . . . . . . . . . .   $800
                                                                • Admissions,                                                 Organizations
2. Lobbying expenses paid or incurred                    $600
                                                                • Membership fees,                                            One of the requirements that an
3. Less: Total nondeductible amount of                          • Dues,                                                       organization must meet to qualify under
   dues notices . . . . . . . . . . . . . . .     100    100
                                                                • Assessments, and                                            section 501(c)(12) is that at least 85%
4. (Subtract line 3 from both lines 1 and
   2) . . . . . . . . . . . . . . . . . . . . .   $700   $500
                                                                • Investment income (such as                                  of its gross income consists of amounts
                                                                dividends, rents, and similar receipts),                      collected from members for the sole
5. Taxable amount of lobbying expenses
   (smaller of the two amounts on line 4)                $500   and normal recurring capital gains on                         purpose of meeting losses and
                                                                investments.                                                  expenses. For purposes of section
            The amounts on lines 1, 2, 3,                           Gross receipts do not include:                            501(c)(12), the term gross income is
  TIP and 5 of the workpapers were                              • Capital contributions (see                                  gross receipts without reduction for any
        entered on lines 85c through 85f                        Regulations section 1.118-1),                                 cost of goods sold.
of the 2007 Form 990.                                           • Initiation fees, or                                             Gross income for mutual or
   Because dues, etc., received were                            • Unusual amounts of income (such as                          cooperative electric companies is
greater than lobbying expenses, there                           the sale of the clubhouse).                                   figured by excluding any income
is no carryover of excess lobbying                                                                                            received or accrued from:
                                                                         College fraternities or sororities
expenses to line 85d of the year 2008                                                                                             1. Qualified pole rentals,
Form 990.                                                           !    or other organizations that
                                                                 CAUTION charge membership initiation
                                                                                                                                  2. Any provision or sale of electric
                                                                                                                              energy transmission services or
  See the instructions for lines 85g                            fees, but not annual dues, do include
                                                                                                                              ancillary service if the services are
and 85h for the treatment of the $500.                          initiation fees in their gross receipts.
                                                                                                                              provided on a nondiscriminatory open
  For Organization B — Dues,                                        If the 35% and 15% limits do not                          access basis under an open access
assessments, and similar amounts                                affect the club’s exempt status, include                      transmission tariff; approved or
                                                                                            -48-                                   Specific Instructions for Form 990
accepted by the Federal Energy                principles in determining its ownership     See General Instruction W for
Regulatory Commission (FERC) or               interests in other entities.                information about prohibited tax shelter
under an independent transmission                 If the organization answered “Yes,”     transactions.
provider agreement approved or                to line 88b, complete Part XI,                 If the organization answered “Yes,” it
accepted by FERC (other than income           Information Regarding Transfers To          must complete Form 8886-T.
received or accrued directly or indirectly    and From Controlled Entities.
from a member),                                                                           Line 89f. Applicable Insurance
   3. The provision or sale of electric       Line 89a. Section 501(c)(3)                 Contract Interest
energy distribution services or ancillary     Organizations: Disclosure of                Answer “Yes” if after August 17, 2006,
services if the services are provided on      Excise Taxes Imposed Under                  but before August 17, 2008, the
a nondiscriminatory, open-access basis        Section 4911, 4912, or 4955                 organization directly or indirectly
to distribute electric energy not owned
                                              Section 501(c)(3) organizations must        acquired an applicable insurance
by the mutual or electric cooperative
                                              disclose any excise tax imposed during      contract which is a part of a structured
company:
                                              the year under section 4911 (excess         transaction involving a pool of such
   a. To end-users who are served by          lobbying expenditures), 4912                contracts. If the organization answered
distribution facilities not owned by the      (disqualifying lobbying expenditures),      “Yes,” it also must complete Form
company or any of its members (other          or, unless abated, 4955 (political          8921.
than income received or accrued               expenditures). See sections 4962 and
directly or indirectly from a member), or                                                    An applicable insurance contract is
                                              6033(b).                                    any life insurance, annuity, or
   b. Generated by a generation facility
not owned or leased by the company or         Line 89b. Section 501(c)(3) and             endowment contract to which an
any of its members and which is directly      501(c)(4) Organizations:                    applicable exempt organization and a
connected to distribution facilities                                                      person other than an applicable exempt
                                              Disclosure of Section 4958                  organization have directly or indirectly
owned by such company or any of its           Excess Benefit Transactions
members (other than income received                                                       held an interest in the contract (whether
or accrued directly or indirectly from a
                                              and Excise Taxes                            or not at the same time). However, an
member).                                      Sections 6033(b) and 6033(f) require        applicable insurance contract does not
   4. From any nuclear                        section 501(c)(3) and (4) organizations     include any life insurance, annuity, or
decommissioning transaction, or               to report the amount of taxes imposed       endowment contract if:
   5. From any asset exchange or              under section 4958 (excess benefit              1. All persons directly or indirectly
conversion transaction.                       transactions) involving the organization,   holding any interest in the contract
                                              unless abated, as well as any other         (other than applicable exempt
   For a mutual or cooperative                information the Secretary may require       organizations) have an insurable
telephone company, gross income also          concerning those transactions. See          interest in the insured under the
does not include amounts received or          General Instruction P for a discussion      contract independent of any interest of
accrued either from another telephone         of excess benefit transactions.             an applicable exempt organization in
company for completing long distance             Attach a statement describing any        the contract, or
calls to or from or between the               excess benefit transaction, the                 2. The sole interest in the contract
telephone company’s members, or from          disqualified person or persons involved,    of an applicable exempt organization or
the sale of display listings in a directory   and whether or not the excess benefit       each person other than an applicable
furnished to the telephone company’s          transaction was corrected.                  exempt organization is as a named
members. Also, gross income does not                                                      beneficiary, or
include amounts received or accrued as
                                              Line 89c. Taxes Imposed on                      3. The sole interest in the contract
qualified pole rentals.                       Organization Managers or                    of each person other than an applicable
                                              Disqualified Persons                        exempt organization is:
Line 88a.                                     For line 89c, enter the amount of taxes         a. As a beneficiary of a trust holding
Answer “Yes” to this question if at any       imposed on organization managers or         an interest in the contract, but only if
time during the tax year, the                 disqualified persons under sections         the person’s designation as the
organization owned a 50% or greater           4912, 4955, and 4958, unless abated.        beneficiary was made without
interest in a taxable corporation or                                                      consideration and solely on a purely
                                              Line 89d. Taxes Reimbursed by               gratuitous basis, or
partnership or an entity disregarded as
separate from the organization under          the Organization                                b. As a trustee who holds an
Regulations sections 301.7701-2 and           For line 89d, enter the amount of tax on    interest in the contract in a fiduciary
301.7701-3. If an organization answers        line 89c that was reimbursed by the         capacity solely for the benefit of
“Yes” on line 88a, complete Part IX,          organization. Any reimbursement of the      applicable exempt organizations or
Information Regarding Taxable                 excise tax liability of a disqualified      persons described above in 1, 2, or 3a.
Subsidiaries and Disregarded Entities.        person or organization manager will be
                                              treated as an excess benefit unless (1)        An applicable exempt organization is
Line 88b.                                     the organization treats the                 any organization to which contributions
Answer “Yes” if at any time during the        reimbursement as compensation during        received are deductible for income tax
tax year, the organization owned more         the year the reimbursement is made,         purposes, estate and gift tax purposes,
than 50% of the:                              and (2) the total compensation to that      and Indian tribal governments.
• Stock (by vote or value) in a               person, including the reimbursement, is
                                                                                          Line 89g. Disclosure of Excess
corporation,                                  reasonable.
                                                                                          Business Holdings
• Interest (either profit or capital) in a    Line 89e. Prohibited Tax Shelter
partnership, or                                                                           Answer “Yes” if the organization is a
                                              Transactions
• Beneficial interest in any other entity.                                                supporting organization or a donor
                                              Answer “Yes” if the organization was a      advised fund maintained by a
   The organization must apply section        party to a prohibited tax shelter           sponsoring organization; had excess
318 in determining its ownership of           transaction as described in section         business holdings during its tax year;
stock in a corporation and use similar        4965(e) at any time during the tax year.    and began its tax year after August 17,
Specific Instructions for Form 990                              -49-
2006. See the Instructions for Form          financial account in a foreign country      purpose. Enter gross amounts unless
4720, Schedule C, to determine if the        (such as a bank account, securities         indicated otherwise. Show also any
organization is subject to the excess        account, or other financial account);       revenue excludable from the definition
business holdings tax under section          and                                         of unrelated business taxable income.
4943. If the organization answered               a. The combined value of the               The sum of amounts entered in
“Yes” to line 89g, it must also complete     accounts was more than $10,000 at           columns (B), (D), and (E) for lines 93
Form 4720.                                   any time during the calendar year; and      through 103 of Part VII should match
Donor advised funds. For purposes                b. The accounts were not with a         amounts entered for correlating lines 2
of the excise tax on excess business         U.S. military banking facility operated     through 11 of Part I. Use the following
holdings under section 4943, a donor         by a U.S. financial institution.            table to verify the relationship of Part
advised fund will be treated as a private        2. The organization owns more than      VII with Part I.
foundation. For a definition of donor        50% of the stock in any corporation that
advised funds, and a sponsoring              would answer “Yes” to item 1 above.                   Contributions that are reportable
organization, see the instructions for                                                    TIP on lines 1a through 1e of Part I
Line 1a. Contributions to Donor Advised         If the “Yes” box is checked, enter the             are not reportable in Part VII.
Funds. Also see, Donor advised funds         name of the foreign country or
                                             countries. Attach a separate sheet if       Amounts in Part VII                                 Correspond
under Excess Benefit Transaction, in                                                     on Line:                                            to Amounts
General Instruction P, to determine who      more space is needed. File Form TD F
                                             90-22.1 by June 30, 2008, with the                                                               in Part I on
is considered a disqualified person for                                                                                                             Line:
purposes of determining the excise tax       Department of the Treasury at the
on excess business holdings for a            address shown on the form.                   93(a) through (g) . . . . .        .   .   .   .   .   .   .   .   .   .   2
donor advised fund.                             Form TD F 90-22.1 is available by         94 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   .   3
                                             calling 1-800-TAX-FORM                       95 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   .   4
Supporting organizations. Only                                                            96 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   .   5
certain supporting organizations are         (1-800-829-3676) or by downloading it
                                             from the IRS website at www.irs.gov.         97 and 98 . . . . . . . . . .      .   .   .   .   .   .   .   .   .   . 6c
subject to the excess business holdings                                                   99 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   .   7
tax under section 4943. These include:       Do not file Form TD F 90-22.1 with the
                                                                                         100 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   . 8d
• Type III supporting organizations that     IRS or attach it to Form 990.
                                                                                         101 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   . 9c
are not functionally integrated; and         Line 92. Section 4947(a)(1)                 102 . . . . . . . . . . . . . . .   .   .   .   .   .   .   .   .   .   . 10c
• Type II supporting organizations that      Nonexempt Charitable Trusts                 103(a) through (e) . . . . .        .   .   .   .   .   .   .   .   .   . 11
accept any gift or contribution from a                                                   105 (plus line 1e, Part I) .        .   .   .   .   .   .   .   .   .   . 12
person who, by himself or in connection      Section 4947(a)(1) nonexempt
with a related party, controls the           charitable trusts that file Form 990
                                             instead of Form 1041 and have no
                                                                                         Completing Part VII
supported organization of such Type II
supporting organization.                     taxable income under Subtitle A may
                                             use Form 990 to meet its Section 6012       Column (A)
    To determine if the organization is a    filing requirement by checking the box      In column (A), identify any unrelated
supporting organization and if so, what      on line 92. Also, enter on line 92 the      business income reportable in column
type of supporting organization it is, see   total of exempt-interest dividends          (B) by selecting a business code from
the Instructions for Schedule A, Line        received from a mutual fund or other        the Codes for Unrelated Business
13. Supporting Organizations.                regulated investment company as well        Activity in the 2007 Instructions for
    Also see, Supporting organizations       as tax-exempt interest received directly.   Form 990-T.
under Excess Benefit Transaction, in                                                        Use the current codes listed in the
General Instruction P, to determine who                                                  2007 Instructions for Form 990-T.
is considered a disqualified person for      Part VII—Analysis of
purposes of determining the excise tax       Income-Producing Activities                 Column (B)
on excess business holdings for a            Political organizations described in        In column (B), enter any revenue
supporting organization.                     section 527 are not required to             received from activities unrelated to the
                                             complete this Part.                         exempt purpose of the organization.
Line 90a. List of States                                                                 See the Instructions for Form 990-T
                                                 An organization is exempt from
List each state with which the                                                           and Pub. 598 for a discussion of what
                                             income taxes only if its primary purpose
organization is filing a copy of this                                                    is unrelated business income. If the
                                             is to engage in the type of activity for
return in full or partial satisfaction of                                                organization enters an amount in
                                             which it claims exemption.
state filing requirements.                                                               column (B), then it must enter a
                                                 An exempt organization is subject to    business code in column (A).
Line 90b. Number of Employees                a tax on unrelated business taxable
Enter the number of employees on the         income if such income is from a trade       Column (C)
organization’s payroll during the pay        or business that is regularly carried on    In column (C), enter an exclusion code
period including March 12, 2007, as          by the organization and is not              from the Exclusion Codes list on the
shown on its Form 941 or Form 943            substantially related to the                last page of the Specific Instructions for
(January-March calendar quarter return       organization’s performance of its           Form 990 to identify any revenue
only). Do not include household              exempt purpose or function. Generally,      excludable from unrelated business
employees, persons who received no           a tax-exempt organization with gross        income. If more than one exclusion
pay during the pay period, pensioners,       income of $1,000 or more for the year       code applies to a particular revenue
or members of the Armed Forces.              from an unrelated trade or business         item, use the lowest numbered
                                             must file Form 990-T and pay any tax        exclusion code that applies. If
Line 91b. Foreign Accounts                   due.                                        nontaxable revenues from several
Check the “Yes” box if either 1 or 2             In Part VII, show whether revenue,      sources are reportable on the same line
below applies:                               also reportable on lines 2 through 11 of    in column (D), use the exclusion code
   1. At any time during the calendar        Part I, was received from activities        that applies to the largest revenue
year, the organization had an interest in    related to the organization’s purpose or    source. If the list of exclusion codes
or signature or other authority over a       activities unrelated to its exempt          does not include an item of revenue
                                                               -50-                             Specific Instructions for Form 990
that is excludable from unrelated             primarily benefited the government            General instructions for lines 99
business income, enter that item in           agencies.                                     through 102 are given in the
column (E) and see the instructions for          Report on line 2 of Part I (program        instructions for Part I, lines 7 through
column (E).                                   service revenue) the sum of the entries       10.
Column (D)                                    in columns (B), (D), and (E) for lines
                                              93(a) through (g).
                                                                                            Lines 103(a) through (e). Other
For column (D), identify any revenue                                                        Revenue
received that is excludable from              Lines 94 through 96. Dues,                    List any Other revenue activity on these
unrelated business income. If the             Assessments, Interest, and                    lines. These activities are discussed in
organization enters an amount in
column (D), it must enter an exclusion        Dividends                                     the instructions for line 11, Part I. In the
                                              In the appropriate columns, report the        appropriate columns, enter the revenue
code in column (C).
                                              revenue received for these line items.        received from these activities. Select
Column (E)                                    General instructions for lines 94             applicable business and exclusion
For column (E), report any revenue            through 96 are given in the instructions      codes. Report as Other revenue, on
from activities related to the                for Part I, lines 3 through 5.                line 11 of Part I, the total revenue
organization’s exempt purpose; for                                                          entered in columns (B), (D), and (E) for
example, income received from                 Lines 97 and 98. Rental Income                lines 103(a) through (e).
activities that form the basis of the         (Loss)
organization’s exemption from taxation.       Report net rental income from
                                                                                            Line 105. Total
Also report here any revenue that is          investment property on these lines.           Enter the total revenue reported on line
excludable from gross income other            Also report here rental income from           104 for columns (B), (D), and (E). The
than by section 512, 513, or 514, such        unaffiliated exempt organizations.            amount reported on line 105, plus the
as interest on state and local bonds          Report rental income, however, from an        amount on line 1e of Part I, should
that is excluded from tax by section          exempt function (program service) on          equal the amount entered for Total
103. Explain in Part VIII how any             line 93. Refer to the instructions for Part   revenue on line 12 of Part I.
amount reported in column (E) relates         I, line 6. A more detailed discussion of
to the accomplishment of the                  rental income is given in the
organization’s exempt purposes.               Instructions for Form 990-T and Pub.          Part VIII—Relationship of
Lines 93(a) through (g).                      598.                                          Activities to the
Program Service Revenue                            Rents from real property are usually     Accomplishment of Exempt
List the organization’s                       excluded in computing unrelated               Purposes
revenue-producing program service             business taxable income, as are
                                                                                            To explain how an amount entered in
activities on these lines. Program            incidental amounts (10% or less) of
                                                                                            Part VII, column (E), was related or
service activities are primarily those        rental income from personal property
                                                                                            exempt function income, show the line
that form the basis of an organization’s      leased with real property (mixed lease).
                                                                                            number of the amount in column (E)
exemption from tax. Enter in the              In a mixed lease where the rent
                                                                                            and give a brief description of how the
appropriate columns, gross revenue            attributable to personal property is more
                                                                                            activity reported in column (E)
from each program service activity and        than 50% of the total rent, neither rent
                                                                                            specifically contributed to the
the business and exclusion codes that         from real or personal property is
                                                                                            accomplishment of the organization’s
identify this revenue. See the                excluded from unrelated business
                                                                                            exempt purposes (other than by
explanation of program service revenue        taxable income. The exclusion also
                                                                                            providing funds for such purposes).
in the instructions for Part I, line 2. For   does not apply when the real or
                                                                                            Activities that generate exempt-function
501(c)(15) reporting of insurance             personal property rentals depend
                                                                                            income are activities that form the basis
premiums received, refer to instructions      wholly or partly on the income or profits
                                                                                            of the organization’s exemption from
for Part I, line 2.                           from leased property, other than an
                                                                                            tax.
                                              amount based on a fixed percentage or
Line 93(f). Medicare and                      percentage of gross receipts or sales.           Also give the line number and an
Medicaid Payments                                  The rental exclusion from unrelated      explanation for any income entered in
Enter the revenue received from               business taxable income does not              column (E) that is specifically excluded
Medicare and Medicaid payments. See           apply to debt-financed real property. In      from gross income other than by
the Example of program service                general, debt-financed property is any        sections 512, 513, or 514. If no amount
revenue in the instructions for Part I,       property that the organization finances       is entered in column (E), do not
line 2.                                       by debt and holds to produce income           complete Part VIII.
                                              instead of for exempt purposes. An                Example. M, an organization
Line 93(g). Fees and Contracts                exempt organization’s income from
From Government Agencies                                                                    described in section 501(c)(3), operates
                                              debt-financed property is treated as          a school for the performing arts.
In the appropriate columns, enter gross       unrelated business taxable income and         Admission is charged at student
revenue earned from fees and contract         is subject to tax in the same proportion      performances. M reported admission
payments by government agencies for           as the property remains financed by the       income in column (E) of Part VII and
a service, facility, or product that          debt. If substantially all (85% or more)      explained in Part VIII that performances
benefited the government agency               of any property is used for an                before an audience were an essential
primarily, either economically or             organization’s exempt purposes, the           part of the students’ training and related
physically. Do not include government         property is not treated as debt-financed      to the exempt purpose of the
grants that enabled the organization to       property. The rules for debt-financed         organization.
benefit the public directly and primarily.    property do not apply to rents from
See Part I, line 1d instructions for the      personal property.                               Because M also reported interest
distinction between government grants                                                       from state bonds in column (E) of Part
that represent contributions and              Lines 99 through 102                          VII, M explained in Part VIII that such
payments from government agencies             In the appropriate columns, report the        interest was excluded from gross
for a service, product, or facility that      revenue received for these line items.        income by section 103.
Specific Instructions for Form 990                               -51-
   If additional space is needed, see         If, in connection with any transfer of    payment for that loan. If additional
Attachments in General Instruction X.      funds to a charitable organization, the      space is needed, attach a statement.
                                           organization directly or indirectly pays     See Attachments in General Instruction
                                           premiums on any personal benefit             X.
Part IX—Information                        contract, or there is an understanding
Regarding Taxable                          or expectation that any person will
                                           directly or indirectly pay such              Line 107. Answer “Yes” and complete
Subsidiaries and                                                                        the schedule if at any time during the
                                           premiums, the organization must report
Disregarded Entities                       the premiums it paid and the premiums        tax year, the organization received any
Column (A). Enter the name, address,       paid by others, but treated as paid by       transfers of funds or payments from a
and EIN of each taxable corporation or     the organization, on Form 8870. The          controlled entity within the meaning of
partnership and each disregarded entity    organization must report and pay an          section 512(b)(13).
in which the organization held a 50% or    excise tax, equal to premiums paid, on
greater interest at any time during the    Form 4720.
year. If a disregarded entity does not                                                     In column (c), describe each
have its own EIN, state that it uses the                                                transfer. Indicate in the description if
organization’s EIN.                        Part XI — Information                        such transfer is a qualifying specified
Columns (D) and (E). Enter the             Regarding Transfers To and                   payment (described in line 108) and
corporation’s or partnership’s total       From Controlled Entities                     indicate the type of transfer such as
income and end-of-year total assets as                                                  interest, annuities, royalties, rents,
                                           Line 106. Answer “Yes” and complete
reported on each entity’s federal tax                                                   dividends, fees or other payments for
                                           the schedule if at any time during the
return for the year ending within the                                                   services, or contributions to capital, and
                                           tax year the organization made any
year covered by the parent                                                              loans.
                                           loans or transfers to a corporation,
organization’s Form 990. Since the
                                           partnership, or other entity, which it
financial information of a disregarded
                                           controlled within the meaning of section        In column (d), enter the amount
entity is reported on its parent
                                           512(b)(13). In column (c), describe          received for each type of payment. If
organization’s return, enter in column
                                           each loan or transfer (including but not     additional space is needed, attach a
(D) the amount on line 12, Total
                                           limited to interest, annuities, royalties,   statement. See Attachments in General
revenue, that is attributable to the
                                           or rents). In column (d) enter the
disregarded entity. Enter in column (E)                                                 Instruction X.
                                           amount for each loan or transfer to
the amount on line 59, Total assets,
                                           each controlled entity. Report only the
column (B), that is attributable to the                                                 Line 108. Answer “Yes” if the
                                           total of all payments for a specific
disregarded entity.
                                           transfer transaction. For example, for a     organization had a contract covering
                                           loan, report only the total of all           payments from a controlled entity of
Part X—Information                         payments rather than each individual         interest, annuities, royalties, or rents,
Regarding Transfers                                                                     but only if the contract was in writing,
Associated With Personal                                                                legally enforceable, and in effect on
                                                                                        August 17, 2006. Also, answer “Yes” if
Benefit Contracts                                                                       the contract described above had been
See General Instruction V which also                                                    renewed with substantially similar
discusses the reporting requirements
                                                                                        terms.
for this Part.




                                                             -52-                            Specific Instructions for Form 990
                                                                   Exclusion Codes
  General Exceptions                                    17— Rent from personal property leased with                 85% of the use of the property is for the
                                                            real property and incidental (10% or less) in           organization’s exempt purposes (Note:
  01— Income from an activity that is not regularly                                                                 This code is only for income from the
                                                            relation to the combined income from the
      carried on (section 512(a)(1))                                                                                15% or less non-exempt purpose use.)
                                                            real and personal property (section
  02— Income from an activity in which labor is a           512(b)(3))                                              (section 514(b)(1)(A))
      material income-producing factor and                                                                  31—     Gross income from mortgaged property
                                                        18— Gain (or loss, to the extent allowed) from
      substantially all (at least 85%) of the work                                                                  used in research activities described in
                                                            the sale of investments and other
      is performed with unpaid labor (section                                                                       section 512(b)(7), (8), or (9) (section
                                                            non-inventory property and from certain
      513(a)(1))                                                                                                    514(b)(1)(C))
                                                            property acquired from financial institutions
  03— Section 501(c)(3) organization—Income                 that are in conservatorship or receivership     32—     Gross income from mortgaged property
      from an activity carried on primarily for the         (sections 512(b)(5) and 512(b)(16)(A))                  used in any activity described in section
      convenience of the organization’s                                                                             513(a)(1), (2), or (3) (section 514(b)(1)(D))
                                                        19— Income or loss from the lapse or
      members, students, patients, visitors,
                                                            termination of options to buy or sell           33—     Income from mortgaged property
      officers, or employees (hospital parking lot
                                                            securities, or real property, and from the              (neighborhood land) acquired for exempt
      or museum cafeteria, for example) (section
                                                            forfeiture of good-faith deposits for the               purpose use within 10 years (section
      513(a)(2))
                                                            purchase, sale, or lease of investment real             514(b)(3))
  04— Section 501(c)(4) local association of                property (section 512(b)(5))
      employees organized before 5/27/69—                                                                   34—     Income from mortgaged property
                                                        20— Income from research for the United                     acquired by bequest or devise (applies to
      Income from the sale of work-related
                                                            States; its agencies or instrumentalities; or           income received within 10 years from the
      clothes or equipment and items normally
                                                            any state or political subdivision (section             date of acquisition) (section 514(c)(2)(B))
      sold through vending machines; food
                                                            512(b)(7))                                      35—     Income from mortgaged property
      dispensing facilities; or snack bars for the
      convenience of association members at             21— Income from research conducted by a                     acquired by gift where the mortgage was
      their usual places of employment (section             college, university, or hospital (section               placed on the property more than 5 years
      513(a)(2))                                            512(b)(8))                                              previously and the property was held by
  05— Income from the sale of merchandise,              22— Income from research conducted by an                    the donor for more than 5 years (applies
      substantially all of which (at least 85%) was         organization whose primary activity is                  to income received within 10 years from
      donated to the organization (section                  conducting fundamental research, the                    the date of gift) (section 514(c)(2)(B))
      513(a)(3))                                            results of which are freely available to the    36—     Income from property received in return
                                                            general public (section 512(b)(9))                      for the obligation to pay an annuity
  Specific Exceptions                                   23— Income from services provided under                     described in section 514(c)(5)
  06— Section 501(c)(3), (4), or (5) organization           license issued by a Federal regulatory          37—     Income from mortgaged property that
      conducting an agricultural or educational             agency and conducted by a religious order               provides housing to low and moderate
      fair or exposition—Qualified public                   or school operated by a religious order, but            income persons to the extent the
      entertainment activity income (section                only if the trade or business has been                  mortgage is insured by the Federal
      513(d)(2))                                            carried on by the organization since before             Housing Administration (section 514(c)(6))
  07— Section 501(c)(3), (4), (5), or (6)                   May 27, 1959 (section 512(b)(15))                       (Note: In many cases, this would be
      organization—Qualified convention and             Foreign Organizations                                       exempt function income reportable in
      trade show activity income (section                                                                           column (E). It would not be so in the case
      513(d)(3))                                        24— Foreign organizations only—Income from a                of a section 501(c)(5) or (6) organization,
                                                            trade or business NOT conducted in the                  for example, that acquired the housing as
  08— Income from hospital services described in
                                                            United States and NOT derived from United               an investment or as a charitable activity.)
      section 513(e)
                                                            States sources (patrons) (section 512(a)(2))    38—     Income from mortgaged real property
  09— Income from noncommercial bingo games
      that do not violate state or local law            Social Clubs and VEBAs                                      owned by: a school described in section
      (section 513(f))                                                                                              170(b)(1)(A)(ii); a section 509(a)(3) affiliated
                                                        25— Section 501(c)(7), (9), or (17) organization—           support organization of such a school; a
  10— Income from games of chance conducted                  Non-exempt function income set aside for               section 501(c)(25) organization, or by a
      by an organization in North Dakota (section            a charitable, etc., purpose specified in               partnership in which any of the above
      311 of the Deficit Reduction Act of 1984,              section 170(c)(4) (section 512(a)(3)(B)(i))            organizations owns an interest if the
      as amended)                                       26— Section 501(c)(7), (9), or (17) organization—           requirements of section 514(c)(9)(B)(vi) are
  11— Section 501(c)(12) organization—Qualified              Proceeds from the sale of exempt function              met (section 514(c)(9))
      pole rental income (section 513(g)) and/or             property that was or will be timely
      member income (described in section                    reinvested in similar property (section       Special Rules
      501(c)(12)(H))                                         512(a)(3)(D))                                 39— Section 501(c)(5) organization—Farm
  12— Income from the distribution of low-cost          27— Section 501(c)(9), or (17) organization—            income used to finance the operation and
      articles in connection with the solicitation of        Non-exempt function income set aside for           maintenance of a retirement home,
      charitable contributions (section 513(h))              the payment of life, sick, accident, or other      hospital, or similar facility operated by the
  13— Income from the exchange or rental of                  benefits (section 512(a)(3)(B)(ii))                organization for its members on property
      membership or donor list with an                                                                          adjacent to the farm land (section
                                                        Veterans’ Organizations                                 1951(b)(8)(B) of Public Law 94-455)
      organization eligible to receive charitable
      contributions by a section 501(c)(3)              28— Section 501(c)(19) organization—Payments       40— Annual dues not exceeding $136 (subject
      organization; by a war veterans’                       for life, sick, accident, or health insurance      to inflation) paid to a section 501(c)(5)
      organization; or an auxiliary unit or society          for members or their dependents that are           agricultural or horticultural organization
      of, or trust or foundation for, a war                  set aside for the payment of such                  (section 512(d))
      veterans’ post or organization (section                insurance benefits or for a charitable, etc.,
      513(h))                                                purpose specified in section 170(c)(4)        Trade or Business
                                                             (section 512(a)(4))                           41— Gross income from an unrelated activity
  Modifications and Exclusions                          29— Section 501(c)(19) organization—Income              that is regularly carried on but, in light of
  14— Dividends, interest, payments with respect             from an insurance set-aside (see code 28           continuous losses sustained over a
      to securities loans, annuities, income from            above) that is set aside for payment of            number of tax periods, cannot be
      notional principal contracts, loan                     insurance benefits or for a charitable,            regarded as being conducted with the
      commitment fees, and other substantially               etc., purpose specified in section                 motive to make a profit (not a trade or
      similar income from ordinary and routine               170(c)(4) (Regulations section                     business)
      investments excluded by section 512(b)(1)              1.512(a)–4(b)(2))
                                                                                                            Other
  15— Royalty income excluded by section                Debt-financed Income
      512(b)(2)                                                                                             42—     Receipt of qualified sponsorship
                                                        30—    Income exempt from debt-financed                     payments described in section 513(i)
  16— Real property rental income that does not
                                                               (section 514) provisions because at least    43—     Exclusion of any gain or loss from the
      depend on the income or profits derived by
      the person leasing the property and is                                                                        qualified sale, exchange, or other
      excluded by section 512(b)(3)                                                                                 disposition of any qualifying brownfield
                                                                                                                    property (section 512(b)(19))




Specific Instructions for Form 990                                            -53-
                                                           liquidations, dissolutions, terminations,      and government regulators may use
Specific Instructions for                                  or substantial contractions.                   during normal business hours to obtain
                                                              If the return is an amended return,         information about the organization’s
Form 990-EZ                                                check the box. There are amended               finances and activities. If the
See also the General Instructions that                     return requirements when filing with a         organization does not have a telephone
apply to both Form 990 and Form                            state. See General Instructions E and          number, enter the telephone number of
990-EZ.                                                    J.                                             an organization official who can provide
                                                                                                          such information.
Contents                                         Page      Application pending. If the
Completing the Heading of Form 990-EZ . . .           54   organization’s application for exemption       Item F—Group Exemption
Part I — Revenue, Expenses, and Changes in
                                                           is pending, check this box and                 Number
Net Assets or Fund Balances . . . . . . . . . .       55   complete the return.
                                                                                                          The group exemption number (GEN) is
Part II — Balance Sheets . . . . . . . . . . . . .    60   Item C—Name and Address                        a number assigned by the IRS to the
Part III — Statement of Program Service                    If the organization operates under a           central/parent organization of a group
Accomplishments . . . . . . . . . . . . . . . . . .   60   name different from its legal name, give       that has a group ruling.
Part IV — List of Officers, Directors, Trustees,           the legal name of the organization but             If the organization is covered by a
and Key Employees . . . . . . . . . . . . . . . .     61   identify its alternate name, after the         group exemption letter, enter the
Part V — Other Information . . . . . . . . . . . .    62   legal name, by writing “aka” (also             four-digit group exemption number.
                                                           known as) and the alternate name of            Contact the central/parent organization
                                                           the organization. However, if the              if the organization is unsure of the GEN
                                                           organization has changed its name,             assigned.
Completing the Heading of                                  follow the instructions for Name change
Form 990-EZ                                                in Item B — Checkboxes.                        Item G—Accounting Method
The instructions that follow are keyed to                     Include the suite, room, or other unit      Indicate the method of accounting used
items in the heading for Form 990-EZ.                      number after the street address. If the        in preparing this return. See General
Item A—Accounting Period                                   Post Office does not deliver mail to the       Instruction G.
                                                           street address and the organization has
File the 2007 return for calendar year                     a P.O. box, show the box number                Item H—Schedule B (Form 990,
2007 and fiscal years that begin in                        instead of the street address.
2007 and end in 2008. For a fiscal year                                                                   990-EZ, or 990-PF)
return, fill in the tax year space at the                      If the organization receives its mail in   Whether or not the organization enters
top of page 1.                                             care of a third party (such as an              any amount on line 1 of Form 990-EZ,
                                                           accountant or an attorney), enter on the       the organization must either check the
Item B—Checkboxes                                          street address line C/O followed by the        box in item H or attach Schedule B
                                                           third party’s name and street address or       (Form 990, 990-EZ, or 990-PF). Failure
Address change, name change, and                           P.O. box.                                      to either check the box in item H or file
initial return. Check the appropriate                                                                     Schedule B (Form 990, 990-EZ, or
box if the organization changed its                           For foreign addresses, enter
                                                           information in the following order: City,      990-PF) will result in a determination
address since it filed its previous return,                                                               that the return is incomplete. See the
or if this is the first time the organization              province or state, and the name of the
                                                           country. Follow the foreign country’s          Instructions for Schedule B (Form 990,
is filing either a Form 990 or a Form                                                                     990-EZ, or 990-PF), for more
990-EZ.                                                    practice in placing the postal code in
                                                           the address. Please do not abbreviate          information.
  If the tax-exempt organization has                       the country name.
changed its name, attach the following                                                                              Contributor includes individuals,
documents:                                                    If a change of address occurs after          TIP fiduciaries, partnerships,
                                                           the return is filed, use Form 8822 to                  corporations, associations,
IF the                                                     notify the IRS of the new address.             trusts, and exempt organizations.
organization is .      THEN attach . . .
                                                           Item D—Employer
A corporation          An amendment to the articles        Identification Number                             Guidelines for Meeting the
                       of incorporation with proof of      The organization should have only one            Requirements of Schedule B
                       filing with the state of
                       incorporation.
                                                           federal employer identification number          (Form 990, 990-EZ, or 990-PF)
                                                           (EIN). If the organization has more than
A trust                An amendment to the trust           one EIN and has not been advised               Section 501(c)(3) Org. Meeting the 1/3 Support
                                                           which to use, notify the Internal                           Test of 170(b)(1)(A)
                       agreement signed by the
                       trustee.                            Revenue Service Center, Ogden, UT              If . . . . . . . A section 501(c)(3) organization that
                                                           84201-0027. State what numbers the                              met the 1/3 support test of the
An association         An amendment to the articles        organization has, the name and                                  regulations under 509(a)(1)/
                       of association, constitution,       address to which each number was                                170(b)(1)(A) did not receive a
                       bylaws, or other organizing                                                                         contribution of the greater of $5,000
                       document, along with
                                                           assigned, and the address of its
                                                           principal office. The IRS will advise the                       or 2% of the amount on line 1 of
                       signatures of at least two                                                                          Form 990-EZ, from any one
                       officers/members.                   organization which number to use.                               contributor,*
                                                                   A section 501(c)(9) voluntary          Then . . . . The organization should check the
Final return and amended return.
Organizations should file final returns
                                                             !     employees’ beneficiary
                                                           CAUTION association must use its own
                                                                                                                       box in item H to certify that it is not
                                                                                                                       required to attach Schedule B (Form
                                                                                                                       990, 990-EZ, or 990-PF).
when they cease to be section 501(a)                       EIN and not the EIN of its sponsor.
organizations or section 527                                                                              Otherwise Complete and attach Schedule B
organizations; for example, when they                      Item E—Telephone Number                                  (Form 990, 990-EZ, or 990-PF).
cease operations and dissolve. See the                     Enter a telephone number of the                  Section 501(c)(7), (8), or (10) Organizations
instructions for line 36 that discuss                      organization that members of the public
                                                                              -54-                          Specific Instructions for Form 990-EZ
If . . . . . . . A section 501(c)(7), (8), or (10)             receipts and General Instruction X for a     organizations, or raised by an outside
                 organization did not receive any              discussion on a complete return.             professional fundraiser.
                 contribution or bequest for use
                 exclusively for religious, charitable,
                                                                                                            • Report the value of noncash
                 scientific, literary, or educational
                                                                        To figure if a section 501(c)(15)   contributions at the time of the
                 purposes, or the prevention of cruelty          !      organization qualifies for
                                                                CAUTION tax-exemption for the year, see
                                                                                                            donation. For example, report the gross
                 to children or animals (and did not                                                        value of a donated car as of the time
                 receive any noncharitable                     the definition of gross receipts for         the car was received as a donation.
                 contributions of $5,000 or more as
                 described below under general
                                                               section 501(c)(15) purposes under            • Report all related expenses on lines
                                                               Section 501(c)(15) Organizations in          12 through 16. The organization must
                 rule),
                                                               General Instruction A. Do not use the        show on line 13 professional
Then . . . . The organization should check the                 section 501(c)(15) definition of gross       fundraising fees relating to the gross
             box in item H to certify that it is not           receipts to figure if the organization’s
             required to attach Schedule B (Form                                                            amounts of contributions collected in
             990, 990-EZ, or 990-PF).                          gross receipts are normally $25,000 or       the charity’s name by fundraisers.
                                                               less.                                            Reporting for line 1, in accordance
Otherwise Complete and attach Schedule B
          (Form 990, 990-EZ, or 990-PF).                       Item L—Figuring Gross                        with SFAS 116, Accounting for
                                                                                                            Contributions Received and
       All Other Form 990 or Form 990-EZ                       Receipts                                     Contributions Made, is acceptable for
           Organizations (General rule)
                                                               Only those organizations with gross          Form 990-EZ, or Form 990, purposes,
If . . . . . . . The organization did not show as              receipts of less than $100,000 and total     but not required by the IRS. However,
                 part of line 1 of the Form 990-EZ, a          assets of less than $250,000 at the end      see General Instruction E.
                 contribution of $5,000 or more from           of the year can use the Form 990-EZ. If
                 any one contributor,*                                                                          An organization that receives a grant
                                                               the organization does not meet these
                                                                                                            to be paid in future years should,
Then . . . . The organization should check the                 requirements, it must file Form 990.
                                                                                                            according to SFAS 116, report the
             box in item H to certify that it is not           The organization’s gross receipts are
             required to attach Schedule B (Form                                                            grant’s present value on line 1.
                                                               the total amount it received from all
             990, 990-EZ, or 990-PF).                                                                       Accruals of present value increments to
                                                               sources during its annual accounting
                                                                                                            the unpaid grant should also be
Otherwise Complete and attach Schedule B                       period, without subtracting any costs or
          (Form 990, 990-EZ, or 990-PF).                                                                    reported on line 1 in future years.
                                                               expenses. See the gross receipts
* Total a contributor’s gifts of $1,000 or more to determine                                                1. Contributions can arise from
if a contributor gave $5,000 or more. Do not include           discussion in General Instruction B.
smaller gifts.                                                                                              special events when an excess
                                                                        To figure if a section 501(c)(15)   payment is received for items
Item I—Website                                                   !      organization qualifies for
                                                                CAUTION tax-exemption for the year, see
                                                                                                            offered. Fundraising activities relate to
                                                                                                            soliciting and receiving contributions.
Show the organization’s website                                the definition of gross receipts for         However, special fundraising activities
address if a website is available.                             section 501(c)(15) purposes under            such as dinners, door-to-door sales of
Otherwise, write “N/A” (not applicable).                       Section 501(c)(15) Organizations in          merchandise, carnivals, and bingo
Consider adding the organization’s                             General Instruction A. Do not use the        games can produce both contributions
email address to its website.                                  section 501(c)(15) definition of gross       and revenue. Report as a contribution,
                                                               receipts to figure the amount to enter       both on line 1 and on line 6a (within the
Item J— Organization Type                                      here.                                        parentheses), any amount received
If the organization is exempt under                                                                         through such a special event that is
section 501(c), check the applicable                                                                        greater than the fair market value (retail
box and insert, within the parentheses,                        Part I—Revenue, Expenses,                    value) of the merchandise or services
the number that identifies the type of                                                                      furnished by the organization to the
section 501(c) organization the filer is.
                                                               and Changes in Net Assets
                                                                                                            contributor.
See the chart in General Instruction C.                        or Fund Balances
                                                                                                                This situation usually occurs when
The term section 501(c)(3) includes                            All organizations filing Form 990-EZ         organizations seek support from the
organizations exempt under sections                            with the IRS or any state must               public through solicitation programs that
501(e), (f), (k), and (n). Check the box if                    complete Part I. Some states that            are in part special events or activities
the organization is a section 527                              accept Form 990-EZ in place of their         and are in part solicitations for
political organization. See General                            own forms may require additional             contributions. The primary purpose of
Instruction U.                                                 information. See General Instruction E.      such solicitations is to receive
   If the organization is a section                            Line 1. Contributions, Gifts,                contributions and not to sell the
4947(a)(1) nonexempt charitable trust,                                                                      merchandise at its retail value even
check the applicable box. Note also the
                                                               Grants, and Similar Amounts                  though this might produce a profit.
discussion regarding Schedule A (Form                          Received
                                                                                                                Example. An organization
990 or 990-EZ) and Form 1041 in                                                                             announces that anyone who contributes
General Instruction D and the                                  A. What is included on line 1                at least $40 to the organization can
instructions for line 43.                                      • Report amounts received as                 choose to receive a book worth $16
                                                               voluntary contributions; for example,        retail value. A person who gives $40,
Item K—Gross Receipts of                                       payments, or the part of any payment,        and who chooses the book, is really
$25,000 or Less                                                for which the payer (donor) does not         purchasing the book for $16 and also
Check this box if the organization is not                      receive full retail value (fair market       making a contribution of $24. The
a section 509(a)(3) supporting                                 value) from the recipient (donee)            contribution of $24, which is the
organization and its gross receipts are                        organization.                                difference between the buyer’s
normally not more than $25,000 but the                         • Enter the gross amounts of                 payment and the $16 retail value of the
organization chooses to file Form                              contributions, gifts, grants, and            book, would be reported on line 1 and
990-EZ. If the organization chooses to                         bequests that the organization received      again on line 6a (within the
file Form 990-EZ, be sure to file a                            from individuals, trusts, corporations,      parentheses). The revenue received
complete return. See General                                   estates, affiliates, foundations, public     ($16 retail value of the book) would be
Instruction B for a discussion on gross                        charities, and other exempt                  reported in the right-hand column on
Specific Instructions for Form 990-EZ                                             -55-
line 6a. Any expenses directly relating       the reporting organization. This              benefits. When such an organization
to the sale of the book would be              includes contributions received from a        receives payments from participants, or
reported on line 6b. Any fundraising          parent organization, subordinate, or          their employers, to provide these
expenses relating to the contribution of      another organization having the same          benefits, report the payments on line 2
$24 would be reported on lines 12             parent.                                       as program service revenue, rather
through 16.                                   7. Contributions from a commercial            than on line 1 as contributions.
    If a contributor gives more than $40,     co-venture. Include amounts                   C. How to value noncash
that person would be making a larger          contributed by a commercial co-venture
contribution, the difference between the
                                                                                            contributions
                                              on line 1. These contributions are
book’s retail value of $16 and the            amounts received by the organization          See General Instruction L and
amount actually given. See also the           for allowing an outside organization          Schedule B (Form 990, 990-EZ, or
instructions for line 6 and Pub. 526.         (donor) or individual to use the recipient    990-PF).
         At the time of any solicitation or   organization’s name in a sales                D. Schedule of contributors
                                              promotion campaign.
  !      payment, organizations that are
 CAUTION eligible to receive tax-deductible   8. Contributions or grants from
                                                                                            Attach Schedule B (Form 990, 990-EZ,
                                                                                            or 990-PF). See General Instruction L
contributions should advise patrons of        governmental units. A grant, or other         and the Specific Instructions for
the amount deductible for federal tax         payment from a governmental unit, is          Completing the Heading of Form
purposes. See General Instruction L.          treated as a grant equivalent to a            990-EZ, Item H.
2. Contributions can arise from               contribution if its primary purpose is to
                                              enable the recipient to provide a             Line 2—Program Service
special events when items of only
nominal value are given or offered.           service to, or maintain a facility for, the   Revenue Including Medicare,
If an organization offers goods or            direct benefit of the public rather than to   Medicaid Payments, and
services of only nominal value through        serve the direct and immediate needs          Government Fees and
a special event, or distributes free,         of the grantor (even if the public pays       Contracts
unordered, low-cost items to patrons,         part of the expense of providing the
                                              service or facility). (See also line 1,       Enter the total program service revenue
report the entire amount received for                                                       (exempt function income). Program
such benefits as a contribution on line       instruction B1, below.)
                                                                                            services are primarily those that form
1. Report all related expenses on lines       9. Contributions in the form of               the basis of an organization’s
12 through 16.                                membership dues. Include on line 1            exemption from tax.
    See General Instruction L for a           membership dues and assessments to
                                              the extent they are contributions and         1. Examples. A clinic would include
definition of benefits that have a                                                          on line 2 all of its charges for medical
nominal or insubstantial value.               not payments for benefits received.
                                              (See line 3, instruction C1.)                 services (whether to be paid directly by
3. Section 501(c)(3) organizations.                                                         the patients or through Medicare,
These organizations must compute the          B. What is not included on line               Medicaid, or other third-party
amounts of revenue and contributions          1                                             reimbursement), laboratory fees, and
received from special events according                                                      related charges for services.
to the above instructions when                1. Grants that are payments for
                                              services are not contributions. A                Program service revenue also
preparing their Support Schedule in                                                         includes tuition received by a school;
Part IV-A of Schedule A (Form 990 or          grant is a payment for services, and not
                                              a contribution, when the terms of the         revenue from admissions to a concert
990-EZ).                                                                                    or other performing arts event or to a
4. Grants equivalent to                       grant provide the grantor with a specific
                                              service, facility, or product, rather than    museum; royalties received as author
contributions. Grants made to                                                               of an educational publication distributed
encourage an organization receiving           providing a benefit to the general public
                                              or that part of the public served by the      by a commercial publisher; payments
the grant to carry on programs or                                                           received by a section 501(c)(9)
activities that further the grant             grant recipient. The recipient
                                              organization would report such a grant        organization from participants or
recipient’s exempt purposes are grants                                                      employers of participants for health and
that are equivalent to contributions.         as income on line 2 (program service
                                              revenue).                                     welfare benefits coverage; and
Report them on line 1. The grantor may                                                      registration fees received in connection
specify which of the recipient’s activities   2. Donations of services. Do not              with a meeting or convention.
the grant may be used for, such as an         include the value of services donated to      2. Program-related investment
adoption program or a disaster relief         the organization, or items such as the        income. Program service revenue
project.                                      free use of materials, equipment, or          also includes income from
    A grant is still equivalent to a          facilities, as contributions on line 1.       program-related investments. These
contribution if the grant recipient           However, for the optional reporting of        investments are made primarily to
performs a service, or produces a work        such amounts, see the instruction for         accomplish an exempt purpose of the
product, that benefits the grantor            donated services in Part III.                 investing organization rather than to
incidentally (but see line 1, instruction         Any unreimbursed expenses of              produce income. Examples are
B1, below).                                   officers, employees, or volunteers do         scholarship loans and low-interest
5. Contributions received through             not belong on the Form 990 or Form            loans to charitable organizations,
other fundraising organizations.              990-EZ. See the instructions for              indigents, or victims of a disaster.
Contributions received indirectly from        charitable contributions and employee         Rental income received from an exempt
the public through solicitation               business expenses in Pub. 526 and             function is another example of
campaigns conducted by federated              463, respectively.                            program-related investment income.
fundraising agencies (such as United          3. Section 501(c)(9), (17), and (18)          See also the instructions for line 4.
Way) are included on line 1.                  organizations. These organizations            3. Unrelated trade or business
6. Contributions received from                provide participants with life, sickness,     activities. Unrelated trade or business
associated organizations. Include on          accident, welfare and unemployment            activities (not including any special
line 1 amounts contributed by other           insurance, pension(s), or similar             events or activities) that generate fees
organizations closely associated with         benefits, or a combination of these           for services may also be program
                                                                 -56-                        Specific Instructions for Form 990-EZ
service activities. A social club, for       2. Dues received primarily for the          organization rents to an unaffiliated
example, should report as program            organization’s support. If a member         exempt organization at less than fair
service revenue the fees it charges          pays dues primarily to support the          rental value for the purpose of helping
both members and nonmembers for the          organization’s activities, and not to       that unaffiliated organization carry out
use of its tennis courts and golf course.    obtain benefits of more than nominal        its exempt purpose. Report rental
4. Government fees and contracts.            monetary value, those dues are a            income received in these instances on
Program service revenue includes             contribution to the organization            line 2 and not on line 4.
income earned by the organization for        includible on line 1.                           Only for purposes of completing this
providing a government agency with a         Line 4—Investment Income                    return, treat income from renting
service, facility, or product that                                                       property to affiliated exempt
benefited that government agency                                                         organizations as exempt function
directly rather than benefiting the public   A. What is included on line 4               income and include such income on
as a whole. See line 1, instruction A8,      1. Interest on savings and temporary        line 2 as program service revenue.
for reporting guidelines when payments       cash investments. Include the
are received from a government agency                                                    Lines 5a through 5c—Gains (or
                                             amount of interest received from
for providing a service, facility, or        interest-bearing checking accounts,         Losses) From Sale of Assets
product for the primary benefit of the       savings, and temporary cash                 Other Than Inventory
general public.                              investments, such as money market
                                             funds, commercial paper, certificates of    A. What is included on line 5
Line 3—Membership Dues and                   deposit, and U.S. Treasury bills or other
Assessments                                                                              Report on line 5a all sales of securities
                                             governmental obligations that mature in     and sales of all other types of
Enter members’ and affiliates’ dues and      less than 1 year. So-called dividends or    investments (such as real estate,
assessments that are not contributions.      earnings received from mutual savings       royalty interests, or partnership
See also General Instruction L.              banks, money market funds, etc., are        interests) as well as sales of all other
                                             actually interest and should be included    noninventory assets (such as
A. What is included on line 3                on this line.                               program-related investments and fixed
1. Dues and assessments received             2. Dividends and interest from              assets used by the organization in its
that compare reasonably with the             securities. Include the amount of           related and unrelated activities).
benefits of membership. When the             dividend and interest income from               Total the cost or other basis (less
organization receives dues and               equity and debt securities (stocks and      depreciation) and selling expenses and
assessments that compare reasonably          bonds) on this line. Include amounts        enter the result on line 5b. On line 5c,
with membership benefits, report such        received from payments on securities        enter the net gain or loss. Report
dues and assessments on line 3.              loans, as defined in section 512(a)(5).     capital gains dividends, the
2. Organizations that generally              3. Gross rents. Include gross rental        organization’s share of capital gains
match dues and benefits.                     income received during the year from        and losses from a partnership, and
Organizations described in section           investment property.                        capital gains distributions from trusts on
501(c)(5), (6), or (7) generally provide     4. Other investment income. Include,        lines 5a and 5c. Indicate the source on
benefits with a reasonable relationship      for example, royalty income from            the schedule described below.
to dues, although benefits to members        mineral interests owned by the                  For this return, the organization may
may be indirect.                             organization.                               use the more convenient way to figure
B. Examples of membership                                                                the organization’s gain or loss from
                                             B. What is not included on line             sales of securities by comparing the
benefits                                     4                                           sales price with the average-cost basis
These include subscriptions to                                                           of the particular security sold. However,
publications; newsletters (other than        1. Capital gains dividends and
                                             unrealized gains and losses. Do not         generally the average-cost basis is not
one about the organization’s activities                                                  used to figure the gain or loss from
only); free or reduced-rate admissions       include on this line any capital gains
                                             dividends. They are reported on line 5.     sales of securities reportable on Form
to events the organization sponsors;                                                     990-T.
use of its facilities; and discounts on      Also do not include unrealized gains
articles or services that both members       and losses on investments carried at        B. What is not included on line
and nonmembers can buy. In figuring          market value. See the instructions for      5
the value of membership benefits,            line 20.
                                                                                         Do not include on line 5 any unrealized
disregard such intangible benefits as        2. Exempt function revenue                  gains or losses on securities that are
the right to attend meetings, vote, or       (program service). Do not include on        carried in the books of account at
hold office in the organization, and the     line 4 amounts that represent income        market value. See the instructions for
distinction of being a member of the         from an exempt function (program            line 20.
organization.                                service). Report these amounts on line
                                             2 as program service revenue. Report        C. Attached schedule
C. What is not included on line              expenses related to this income on          1. Nonpublicly traded securities and
3                                            lines 12 through 16.                        noninventory items. Attach a
1. Dues or assessments received                 An organization whose exempt             schedule to show the sale or exchange
that exceed the value of available           purpose is to provide low-rental housing    of nonpublicly traded securities and the
membership benefits. Whether or              to persons with low income receives         sale or exchange of other assets that
not membership benefits are used,            exempt function income from such            are not inventory items. The schedule
dues received by an organization, to         rentals. An organization receives           should show security transactions
the extent they exceed the monetary          exempt function income if it rents or       separately from the sale of other
value of the membership benefits             sublets rental space to a tenant whose      assets. Show for these assets:
available to the dues payer, are a           activities are related to the reporting     • Date acquired and how acquired,
contribution that should be reported on      organization’s exempt purpose. Exempt       • Date sold and to whom sold,
line 1.                                      function income also arises when an         • Gross sales price,
Specific Instructions for Form 990-EZ                          -57-
• Cost, other basis, or if donated, value      Seven cards, Nevada Club tickets,             contributors and other respondents are
at time acquired (state which),                casino nights, Las Vegas nights, and          entered in a drawing for prizes.
• Expense of sale and cost of                  coin-operated gambling devices.                  When a minimum payment is
improvements made after acquisition,           Coin-operated gambling devices                required for each raffle or lottery entry
and                                            include slot machines, electronic video       and prizes of only nominal value are
• Depreciation since acquisition, if           slot or line games, video poker, video        awarded, report any amount received
depreciable property.                          blackjack, video keno, video bingo,           as a contribution. Report the related
2. Publicly traded securities. For             video pull tab games, etc.                    expenses on lines 12 through 16.
sales of publicly traded securities                                                          3. Activities that generate only
through a broker, the organization may
                                               A. What is included on line 6
                                                                                             contributions are not special events.
total the gross sales price, the cost or       1. Gross revenue/contributions.               An activity that generates only
other basis, and the expenses of sale,         When an organization receives                 contributions, such as a solicitation
and report lump-sum figures in place of        payments for goods or services offered        campaign by mail, is not a special
providing the detailed reporting required      through a special event, enter:               event. Any amount received should be
in the above paragraph.                            1. As gross revenue, on line 6a (in       included on line 1 as a contribution.
    Publicly traded securities include         the right-hand column), the retail value      Related expenses are reportable on
common and preferred stocks, bonds             of the goods or services,                     lines 12 through 16.
(including governmental obligations),              2. As a contribution, on both line 1      C. Attached schedule
and mutual fund shares that are listed         and line 6a (within the parentheses),
and regularly traded in an                     any amount received that exceeds the          Attach a schedule listing the three
over-the-counter market or on an               retail value of the goods or services         largest fundraising events, as
established exchange and for which             given.                                        measured by gross receipts. If gaming
market quotations are published or                                                           is conducted, treat different types of
otherwise readily available.                      Example. At a special event, an            gaming separately to determine the
                                               organization received $100 in gross           three largest events. For example, treat
Lines 6a through 6c—Special                    receipts for goods valued at $40. The         bingo and pull tabs as separate
Events and Activities                          organization entered gross revenue of         fundraising events. Describe each of
On the appropriate line, enter the gross       $40 on line 6a and entered a                  these events by listing the type of event
revenue, expenses, and net income (or          contribution of $60 on both line 1 and        and the number of occasions that the
loss) from all special events and              within the parentheses on line 6a. The        event occurred and show (for each
activities, such as dinners, dances,           contribution was the difference between       event):
carnivals, raffles, bingo games, other         the gross revenue of $40 and the gross            1. Gross receipts,
gaming activities, and door-to-door            receipts of $100.                                 2. Contributions included in gross
sales of merchandise.                                                                        receipts (see line 6, instruction A1,
                                               2. Raffles or lotteries. Report as
                                                                                             above),
    These activities only incidentally         revenue, on line 6a, any amount
                                                                                                 3. Gross revenue (gross receipts
accomplish an exempt purpose. Their            received from raffles or lotteries that
                                                                                             less contributions),
sole or primary purpose is to raise            require payment of a specified
                                                                                                 4. Direct expenses, and
funds that are other than contributions        minimum amount for each entry, unless
                                                                                                 5. Net income or (loss) (gross
to finance the organization’s exempt           the prizes awarded have only nominal
                                                                                             revenue less direct expenses).
activities.                                    value. See line 6, instruction B1 and
    This is done by offering goods or          B2, below.                                    For gaming, direct expenses include:
services that have more than a nominal                                                       cash and noncash prizes,
                                               3. Direct expenses. Report on line 6b
value (compared to the price charged)                                                        compensation to bingo callers and
                                               only the direct expenses attributable to
for a payment that is more than the                                                          workers, rental of gaming equipment,
                                               the goods or services the buyer
direct cost of those goods or services.                                                      cost of bingo supplies such as pull tab
                                               receives from a special event. If the
See line 1 instructions A1 and A2 for a                                                      deals, etc.
                                               organization includes an expense on
discussion on contributions reportable         line 6b, do not report it again on line 7b.      Furnish the same information, in
on line 1 and revenue reportable on line       Report cost of goods related to the sale      total figures, for all other special events
6. See also General Instruction L.             of inventory on line 7b. Fundraising          held that are not among the largest
                                               expenses attributable to contributions        three. Indicate the type and number of
    Calling any required payment a
                                               reported on line 6a (within the               the events not listed individually (for
donation or contribution on tickets,
                                               parentheses), and also on line 1, are         example, three dances and two raffles).
advertising, or solicitation materials
does not change how these payments             reportable on lines 12 through 16.               An example of this schedule of
should be reported on Form 990-EZ.                                                           special events might appear in
                                               B. What is not included on line               columnar form as follows:
    The gross revenue from gaming              6                                             Special Events (and the    (A)   (B)    (C) All Total
activities and other special events must                                                     number of occasions that    #     #      # Other
be reported in the right-hand column on        1. Sales or gifts of goods or services        the event occurred):
line 6a without reduction for cash or          of only nominal value. If the goods or        Gross Receipts             $xx   $xx    $xx   $xx   $xx
noncash prizes, cost of goods sold,            services offered at the special event         Less: Contributions         xx     xx    xx    xx    xx
compensation, fees, or other expenses.         have only nominal value, include all of
                                                                                             Gross Revenue               xx     xx    xx    xx    xx
Be sure to check the box for gaming if         the receipts as contributions on line 1
                                               and all of the related expenses on lines      Less: Direct Expenses       xx     xx    xx    xx    xx
the organization conducted directly, or
through the promoter, any amount of            12 through 16. See General Instruction        Net Income or (loss)       $xx   $xx    $xx   $xx   $xx
gaming during the year.                        L for a description of nominal or                If the organization uses this format,
    Gaming includes, but is not limited        insubstantial benefits.                       report the total for Contributions on line
to: bingo, pull tabs, instant bingo raffles,   2. Sweepstakes, raffles, and                  1 of Form 990-EZ and on line 6a (within
scratch-offs, charitable gaming tickets,       lotteries. Report as a contribution, on       the parentheses). Report the totals for
break-opens, hard cards, banded                line 1, the proceeds of solicitation          Gross Revenue, in the right-hand
tickets, jar tickets, pickle cards, Lucky      campaigns in which the names of               column, on line 6a; Direct Expenses on
                                                                  -58-                         Specific Instructions for Form 990-EZ
line 6b; and Net Income or (loss) on        assistance by others at the expense of        identify payments to affiliates;
line 6c.                                    the filing organization.                      payments for nursing services;
                                            2. Payments, voluntary awards, or             fellowships; or payments for food,
Lines 7a through 7c—Gross                                                                 shelter, or medical services for
                                            grants to affiliates. Include on line 10
Sales of Inventory                          certain types of payments to                  indigents or disaster victims. For
1. Sales of inventory. Include on line      organizations affiliated with (closely        payments to indigent families, do not
7a the gross sales (less returns and        related to) the reporting organization.       identify the individuals.
allowances) of inventory items, whether     These payments include predetermined              If an organization gives property
the sales activity is an exempt function    quota support and dues payments by            other than cash and measures an
or an unrelated trade or business.          local organizations to their state or         award or grant by the property’s fair
Include all inventory sales except sales    national organizations.                       market value, also show on this
of goods at special events, which are                                                     schedule:
                                                     If the organization uses Form
reportable on line 6.                                                                     • A description of the property,
2. Cost of goods sold. On line 7b,
                                              !      990-EZ for state reporting
                                             CAUTION purposes, be sure to distinguish
                                                                                          • The book value of the property,
report the cost of goods sold related to    between payments to affiliates and
                                                                                          • How the organization determined the
sales of such inventory. The usual                                                        book value,
                                            awards and grants. See General
items included in cost of goods sold are    Instruction E.
                                                                                          • How the organization determined the
direct and indirect labor, materials and                                                  fair market value, and
supplies consumed, freight-in, and a        B. What is not included on line               • The date of the gift.
proportion of overhead expenses.            10                                                Any difference between a property’s
Marketing and distribution expenses                                                       fair market value and book value
                                            1. Administrative expenses. Do not
are not includible in cost of goods sold.                                                 should be recorded in the
                                            include on this line expenses made in
Include those expenses on lines 12                                                        organization’s books of account and on
                                            selecting recipients or monitoring
through 16.                                                                               line 20.
                                            compliance with the terms of a grant or
3. Investments. Do not include on line      award. Enter those expenses on lines              Colleges, universities, and primary
7 sales of investments on which the         12 through 16.                                and secondary schools are not required
organization expected to profit by          2. Purchases of goods or services             to list the names of individuals who
appreciation and sale. Report sales of      from affiliates. Do not report the cost       were provided scholarships or other
these investments on line 5.                of goods or services purchased from           financial assistance whether they are
                                            affiliates on line 10. Report these as        the recipients of Federal grant money
Line 8—Other Revenue                                                                      or not. Instead, these organizations
Enter the total income from all sources     expenses on lines 12 through 16.
                                                                                          must (a) group each type of financial
not covered by lines 1 through 7.           3. Membership dues paid to another            aid provided; (b) indicate the number of
Examples of types of income includible      organization. Report membership               individuals who received the aid; and
on line 8 are interest on notes             dues that the organization pays to            (c) specify the aggregate dollar amount.
receivable not held as investments or       another organization for general
as program-related investments              membership benefits, such as regular          Line 11—Benefits Paid To or
(defined in the line 2 instructions);       services, publications, and materials on      For Members
interest on loans to officers, directors,   line 16, as Other expenses.                   For an organization that gives benefits
trustees, key employees, and other          C. Attached schedule                          to members or dependents (such as
employees; and royalties that are not                                                     organizations exempt under section
investment income or program service        Attach a schedule to explain the
                                                                                          501(c)(8), (9), or (17)), enter the
revenue.                                    amounts reported on line 10. Show on
                                                                                          amounts paid for: (a) death, sickness,
                                            this schedule:
                                                                                          hospitalization, or disability benefits; (b)
Line 10—Grants and Similar                  • Each class of activity,                     unemployment compensation benefits;
Amounts Paid                                • The grantee’s name and address,             and (c) other benefits. Do not include,
Reporting for line 10 in accordance with    • The amount given, and                       on this line, the cost of
SFAS 116 is acceptable for Form             • The relationship of the grantee (in the     employment-related benefits the
990-EZ purposes, but not required by        case of grants to individuals) if the
                                                                                          organization gives its officers and
IRS. However, see General Instruction       relationship is by blood, marriage,
                                                                                          employees. Report them on line 12.
E.                                          adoption, or employment (including
                                            employees’ children) to any person or         Line 12—Salaries, Other
   An organization that makes a grant       corporation with an interest in the
to be paid in future years should,
                                                                                          Compensation, and Employee
                                            organization, such as a creator, donor,       Benefits
according to SFAS 116, report the           director, trustee, officer, etc.
grant’s present value on line 10.                                                         Enter the total salaries and wages paid
Accruals of present value increments to         Any grants reported on line 10 that       to all employees and the fees paid to
the unpaid grant should also be             were approved during the year, but not        officers, directors, and trustees. Include
reported on line 10 in future years.        paid by the due date for filing Form          the total of the employer’s share of the
                                            990-EZ (including extensions), must be        contributions the organization paid to
A. What is included on line 10              identified and listed separately in the       qualified and nonqualified pension
Enter the amount of actual grants and       line 10 schedule.                             plans and the employer’s share of
similar amounts paid to individuals and         Give the name and address of each         contributions to employee benefit
organizations selected by the filing        affiliate that received any payment           programs (such as insurance, health,
organization. Include scholarship,          reported on line 10. Specify both the         and welfare programs) that are not an
fellowship, and research grants to          amount and purpose of these                   incidental part of a pension plan.
individuals.                                payments.                                     Complete the Form 5500 return if the
1. Specific assistance to individuals.          Classify activities on this schedule in   organization is required to file it.
Include on this line the amount of          more detail than by using such broad              Also include in the total the amount
payments to, or for the benefit of,         terms as charitable, educational,             of federal, state, and local payroll taxes
particular clients or patients, including   religious, or scientific. For example,        for the year that are imposed on the
Specific Instructions for Form 990-EZ                          -59-
organization as an employer. This           5b, 6b, or 7b. Do not include any           Line 22—Cash, Savings, and
includes the employer’s share of social     expenses, such as salaries, for which a     Investments
security and Medicare taxes, Federal        separate line is provided.
                                                                                        Include all interest and non-interest
unemployment tax (FUTA), state
                                            Line 16—Other Expenses                      bearing accounts such as petty cash
unemployment compensation tax, and
                                                                                        funds, checking accounts, savings
other state and local payroll taxes.        Include here such expenses as
                                                                                        accounts, money market funds,
Taxes withheld from employees’              penalties, fines, and judgments;
                                                                                        commercial paper, certificates of
salaries and paid over to the various       unrelated business income taxes;
                                                                                        deposit, U.S. Treasury bills, and other
governmental units (such as Federal         insurance and real estate taxes not
                                                                                        government obligations. Also include
and state income taxes and the              attributable to rental property or
                                                                                        the book value of securities held as
employees’ share of social security and     reported as occupancy expenses;
                                                                                        investments, and all other investment
Medicare taxes) are part of the             depreciation on investment property;
                                                                                        holdings including land and buildings
employees’ salaries included on line 12.    travel and transportation costs; interest
                                                                                        held for investment. Report the income
Report expenses paid or incurred for        expense; and expenses for
                                                                                        from these investments on line 4.
employee events such as a picnic or         conferences, conventions, and
holiday party on this line.                 meetings.                                   Line 23—Land and Buildings
Line 13—Professional Fees and                  Some states that accept Form             Enter the book value (cost or other
                                            990-EZ in satisfaction of their filing      basis less accumulated depreciation) of
Other Payments to Independent               requirements may require that certain       all land and buildings owned by the
Contractors                                 types of miscellaneous expenses be          organization and not held for
Enter the total amount of legal,            itemized. See General Instruction E.        investment.
accounting, auditing, other professional
fees (such as fees for fundraising or       Line 18—Excess or (Deficit) for             Line 24—Other Assets
investment services) and related            the Year                                    Enter the total of other assets along
expenses charged by outside firms and       Enter the difference between lines 9        with a description of those assets.
individuals who are not employees of        and 17. If line 17 is more than line 9,     Amounts to include here are (among
the organization. Do not include any        enter the difference in parentheses.        others) receivable accounts,
penalties, fines, or judgments imposed                                                  inventories, and prepaid expenses.
against the organization as a result of     Line 19—Net Assets or Fund
legal proceedings. Report and identify      Balances at Beginning of Year               Line 25—Total Assets
those expenses on line 16. Report fees      Enter the amount from the prior year’s      Enter the amount of total assets. If the
paid to directors and trustees on line      balance sheet or from Form 5500 or an       end-of-year total assets entered in
12.                                         approved DOL form if General                column (B) are $250,000 or more, Form
                                            Instruction F applies.                      990 must be filed instead of Form
Line 14—Occupancy, Rent,                                                                990-EZ.
Utilities, and Maintenance                  Line 20—Other Changes in Net
Enter the total amount paid or incurred     Assets or Fund Balances                     Line 27—Net Assets or Fund
for the use of office space or other        Attach a statement explaining any           Balances
facilities, heat, light, power, and other   changes in net assets or fund balances      Subtract line 26 (total liabilities) from
utilities, outside janitorial services,     between the beginning and end of the        line 25 (total assets) to determine net
mortgage interest, real estate taxes and    year that are not accounted for by the      assets. Enter this net asset amount on
property insurance attributable to rental   amount on line 18. Amounts to report        line 27. The amount entered in column
property, and similar expenses. Do not      here include adjustments of earlier         (B) should agree with the net asset or
subtract from rental expenses reported      years’ activity; unrealized gains and       fund balance amount on line 21.
on line 14 any rental income received       losses on investments carried at market
from renting or subletting rented space.                                                   States that accept Form 990-EZ as
                                            value; and any difference between fair      their basic report form may require a
See the instructions for lines 2 and 4 to   market value and book value of
determine whether such income is                                                        separate statement of changes in net
                                            property given as an award or grant.        assets. See General Instruction E.
reportable as exempt function income        See General Instruction G regarding
or investment income. However, report       the reporting of a section 481(a)
on line 14 any rental expenses for          adjustment to conform to SFAS 116.
rental income reported on lines 2 and 4.                                                Part III—Statement of
If the organization records depreciation                                                Program Service
on property it occupies, enter the total    Part II—Balance Sheets                      Accomplishments
for the year.                               All organizations, except those that        A program service is a major (usually
  For an explanation of acceptable          meet one of the exceptions in General       ongoing) objective of an organization,
methods for computing depreciation,         Instruction F, must complete columns        such as adoptions, recreation for the
see Pub. 946.                               (A) and (B) of Part II of the return and    elderly, rehabilitation, or publication of
                                            may not submit a substitute balance         journals or newsletters.
Line 15—Printing, Publications,             sheet. Failure to complete Part II may
Postage, and Shipping                       result in penalties for filing an           Step                     Action
Enter the printing and related costs of     incomplete return. If there is no amount
producing the reporting organization’s      to report in column (A), Beginning of        1     State the organization’s primary exempt
own newsletters, leaflets, films, and       year, put a zero in that column. See               purpose.
other informational materials on this       General Instruction K.
                                                                                         2     All organizations must describe their
line. Include the costs of outside             Some states require more                        exempt purpose achievements for each
mailing services on this line. Also         information. See General Instruction E             of their four largest program services (as
include the cost of any purchased           for more information about completing a            measured by total expenses incurred). If
publications as well as postage and         Form 990-EZ to be filed with any state             there were four or fewer of such activities,
shipping costs not reportable on lines      or local government agency.                        describe each program service activity.

                                                               -60-                       Specific Instructions for Form 990-EZ
     • Describe program service                          For purposes of reporting all             director, trustee, or key employee
     accomplishments through measurements            amounts in columns (B) through (E) in         (defined above), during the tax year or,
     such as clients served, days of care,           Part IV, either use the organization’s        if using the calendar year, at any time
     therapy sessions, or publications issued.       tax year, or the calendar year ending         during the calendar year or tax year.
     • Describe the activity’s objective, for both
                                                     within such tax year.
                                                                                                   Column (B)
     this time period and the longer-term goal,          Enter a zero in columns (B), (C), (D),
     if the output is intangible, such as in a       or (E) if no hours were entered in            In column (B), a numerical estimate of
     research activity.                              column (B) and no compensation,               the average hours per week devoted to
                                                     contributions, expenses, and other            the position is required for a complete
     • Give reasonable estimates for any
     statistical information if exact figures are    allowances were paid during the               answer. Statements such as “as
     not readily available. Indicate that this       reporting year, or deferred for payment       needed” or “as required,” or “40+” are
     information is estimated.                       to a future accounting period.                unacceptable.
     • Be clear, concise, and complete in the            Aid in the processing of the              Column (C)
     description. Avoid adding an attachment.        organization’s return by grouping             For each person listed, report salary,
                                                     together, preferably at the end of the        fees, bonuses, and severance
 3   If part of the total expenses of any            list, those who received no
     program service consists of grants
                                                                                                   payments paid. Include current-year
                                                     compensation. Be careful not to repeat        payments of amounts reported or
     reported on line 10, enter the amount of        names.
     grants in the space provided and include                                                      reportable as deferred compensation in
     the grants in the Expenses column. If the           Give the preferred address at which       any prior year.
     amount of grants entered includes foreign       officers, directors, etc., want the
     grants, check the box to the left of the        Internal Revenue Service to contact           Column (D)
     entry space for Program Services                them.                                         Include in this column all forms of
     Expenses.                                                                                     deferred compensation and future
                                                         Use an attachment if there are more
     • Section 501(c)(3) and (4) organizations,      than four persons to list in Part IV.         severance payments (whether or not
     and section 4947(a)(1) nonexempt                                                              funded; whether or not vested; and
     charitable trusts, must show the amount             Show all forms of cash and noncash        whether or not the deferred
     of grants and allocations to others and         compensation received by each listed          compensation plan is a qualified plan
     must enter the total expenses for each          officer, director, etc., whether paid         under section 401(a)). Include also
     program service reported.                       currently or deferred.                        payments to welfare benefit plans on
     • For all other organizations, completing           If the organization pays any other        behalf of the officers, etc. Such plans
     the Program Services Expenses column            person, such as a management                  provide benefits such as medical,
     (and the Grants entry) in Part III is           services company, for the services            dental, life insurance, severance pay,
     optional.                                       provided by any of its officers, directors,   disability, etc. Reasonable estimates
                                                     trustees, or key employees, report the        may be used if precise cost figures are
 4   Attach a schedule that lists the                compensation and other items in Part          not readily available.
     organization’s other program services.          IV as if the organization had paid the
                                                                                                      Unless the amounts were reported in
     • The detailed information required for the     officers, directors, etc., directly. Also,
                                                                                                   column (C), report, as deferred
     four largest services is not necessary for      see Ann. 2001-33, 2001-17 I.R.B.
                                                                                                   compensation in column (D), salaries
     this schedule.                                  1137.
                                                                                                   and other compensation earned during
     • However, section 501(c)(3) and (4)                A failure to fully complete Part IV can   the period covered by the return, but
     organizations, and section 4947(a)(1)           subject both the organization and the         not yet paid by the date the
     nonexempt charitable trusts must show           individuals responsible for such failure
     the expenses attributable to their program
                                                                                                   organization files its return.
                                                     to penalties for filing an incomplete
     services.                                                                                     Column (E)
                                                     return. See General Instruction K. In
                                                     particular, entering the phrase on Part       Enter both taxable and nontaxable
 5   The organization may show the amount
     of any donated services, or use of
                                                     IV, “Information available upon               fringe benefits (other than de minimis
     materials, equipment, or facilities it          request,” or a similar phrase, is not         fringe benefits described in section
     received or utilized in connection with a       acceptable.                                   132(e)). Include amounts that the
     specific program service.                           The organization may also provide         recipients must report as income on
     • Disclose the applicable amounts of any        an attachment to explain the entire           their separate income tax returns.
     donated services, etc., on the lines for the    2007 compensation package for any             Examples include amounts for which
     narrative description of the appropriate        person listed in Part IV.                     the recipient did not account to the
     program service.                                    Key employee. A key employee is           organization or allowances that were
     • Do not include these amounts in the           any person having responsibilities or         more than the payee spent on serving
     expense column in Part III.                     powers similar to those of officers,          the organization. Include payments
                                                     directors, or trustees. The term includes     made under indemnification
     • See the instructions for line 1, B2.                                                        arrangements, the value of the personal
                                                     the chief management and
                                                     administrative officials of an                use of housing, automobiles, or other
                                                     organization (such as an executive            assets owned or leased by the
                                                     director or chancellor).                      organization (or provided for the
Part IV—List of Officers,                                                                          organization’s use without charge), as
                                                         A chief financial officer and the         well as any other taxable and
Directors, Trustees, and Key                         officer in charge of the administration or    nontaxable fringe benefits. See Pub.
Employees                                            program operations are both key               525 for more information.
List each person who was an officer,                 employees if they have the authority to
                                                     control the organization’s activities, its        Form 941 must be filed to report
director, trustee, or key employee                                                                 income tax withholding and social
                                                     finances, or both.
(defined below) of the organization at                                                             security and Medicare taxes. The
any time during the year even if they                Column (A)                                    organization must also file Form 940 to
did not receive any compensation from                Report the name and address of each           report Federal unemployment tax,
the organization.                                    person who was a current officer,             unless the organization is not subject to
Specific Instructions for Form 990-EZ                                   -61-
these taxes. See Pub. 15 (Circular E)         establish that the new legal entity            • 501(c)(5) (agricultural and
for more information. See also the Trust      qualifies for exemption.                       horticultural organizations), or
Fund Recovery Penalty discussion in                                                          • 501(c)(6) (business leagues)
General Instruction D.                        Line 35—Unrelated Business                     are subject to (a) the section 6033(e)
                                              Income and Lobbying Proxy                      notice and reporting requirements, and
                                              Tax                                            (b) a potential proxy tax.
Part V—Other Information
• Section 501(c)(3) organizations and         Unrelated Business Income                         If the organization is not
section 4947(a)(1) nonexempt                                                                 tax-exempt under sections 501(c)(4),
                                              Political organizations described in           (5), or (6), check “No” on line 35a,
charitable trusts must also complete          section 527 are not required to answer
and attach a Schedule A (Form 990 or                                                         unless there was unrelated business
                                              this question.                                 income.
990-EZ) to their Form 990-EZ. See
General Instruction D for information on          Check “Yes” on line 35a if the
Schedule A (Form 990 or 990-EZ).              organization’s total gross income from            If the organization meets Exception
• Answer “Yes,” “No,” or “N/A” to each        all of its unrelated trades and                1 or 2 below, it is excluded from the
question.                                     businesses is $1,000 or more for the           notice, reporting, and proxy tax
• The organization must attach a              year. Gross income is gross receipts           requirements of section 6033(e), and it
statement regarding personal benefit          less the cost of goods sold. See Pub.          should check “No” to line 35a, unless
contracts. See General Instruction V.         598 for a description of unrelated             the organization had $1,000 or more of
                                              business income and the 2007                   unrelated business income. See also
Line 33—Change in Activities                  Instructions for Form 990-T for the            Rev. Proc. 98-19, 1998-1 C.B. 547.
Attach a statement to explain any             Form 990-T filing requirements. Form
                                                                                             Exception 1. Section 6033(e)(3)
changes during the past 3 years in the        990-T is not a substitute for Form
                                                                                             exception for nondeductible dues.
activities the organization conducts to       990-EZ. Items of income and expense
further its exempt purpose, or in the         reported on Form 990-T must also be                1. All organizations exempt from tax
methods of conducting these activities.       reported on Form 990-EZ when the               under section 501(a), other than section
However, if a change has been                 organization is required to file both          501(c)(4), (5), and (6) organizations.
reported to the IRS on a previously filed     forms.                                             2. Local associations of employees’
attachment, do not report the change                                                         and veterans’ organizations described
again. An activity previously listed as                 All tax-exempt organizations         in section 501(c)(4), but not section
current or planned in the organization’s        !       must pay estimated taxes with
                                               CAUTION respect to their unrelated
                                                                                             501(c)(4) social welfare organizations.
application for recognition of exemption                                                         3. Labor unions and other labor
does not have to be reported unless the       business income if they expect their tax       organizations described in section
method of conducting such activity has        liability to be $500 or more. Use Form         501(c)(5), but not section 501(c)(5)
changed. Also, include any major              990-W to compute this tax.                     agricultural and horticultural
program activities that are being                                                            organizations.
                                              Section 6033(e) tax for lobbying
discontinued.                                                                                    4. Section 501(c)(4), (5), and (6)
                                              expenditures                                   organizations that receive more than
Line 34—Changes in                            If the organization checks “No” to line        90% of their dues from:
Organizing or Governing                       35a, it is certifying that the organization
                                              was not subject to the notice and                  a. Section 501(c)(3) organizations,
Documents                                                                                        b. State or local governments,
                                              reporting requirements of section
Attach a conformed copy of any                6033(e) and that the organization had              c. Entities whose income is exempt
changes to the articles of incorporation,     no lobbying and political expenditures         from tax under section 115, or
or association, constitution, trust           potentially subject to the proxy tax.              d. Organizations described in 1
instrument, or other organizing                                                              through 3, above.
document, or to the bylaws or other           Section 6033(e) notice and reporting
governing document.                           requirements and proxy tax. Section                5. Section 501(c)(4) and (5)
                                              6033(e) requires certain section               organizations that receive more than
   A conformed copy is one that agrees        501(c)(4), (5), and (6) organizations to       90% of their annual dues from:
with the original document and all            tell their members the portion of their            a. Persons,
amendments to it. If the copies are not       membership dues that were allocable to             b. Families, or
signed, they must be accompanied by a         the political or lobbying activities of the
written declaration signed by an officer                                                         c. Entities who each paid annual
                                              organization. If an organization does          dues of $95 or less in 2007 (adjusted
authorized to sign for the organization,      not give its members this information,
certifying that they are complete and                                                        annually for inflation). See Rev. Proc.
                                              then the organization is subject to a          2006-53 which is on page 996 of the
accurate copies of the original               proxy tax. The tax is reported on Form
documents.                                                                                   Internal Revenue Bulletin at www.irs.
                                              990-T.                                         gov/pub/irs-irbs/irb06-48.pdf.
   Photocopies of articles of                    If the organization checks “Yes” on             6. Any organization that receives a
incorporation showing the certification       line 35a to declare that it had reportable     private letter ruling from the IRS stating
of an appropriate state official need not     section 6033(e) lobbying and political         that the organization satisfies the
be accompanied by such a declaration.         expenses in the 2007 reporting year            section 6033(e)(3) exception.
See Rev. Proc. 68-14, 1968-1 C.B.             (and potential liability for the proxy tax):       7. Any organization that keeps
768, for details. When a number of                                                           records to substantiate that 90% or
changes are made, attach a copy of the            1. Complete lines 85a-h, page 7, of
                                              Form 990 (note instructions), and              more of its members cannot deduct
entire revised organizing instrument or                                                      their dues (or similar amounts) as
governing document.                               2. Attach page 7 to Form 990-EZ.
                                                                                             business expenses whether or not any
   However, if the exempt organization           Only certain organizations that are         part of their dues are used for lobbying
changes its legal structure, such as          tax exempt under sections:                     purposes.
from a trust to a corporation, it must file   • 501(c)(4) (social welfare                        8. Any organization that is not a
a new exemption application to                organizations),                                membership organization.
                                                                 -62-                          Specific Instructions for Form 990-EZ
        Special rules treat affiliated       • Any dues paid to another                   All section 501(c) organizations. An
    !   social welfare organizations,
CAUTION agricultural and horticultural
                                             organization that are allocable to
                                             lobbying or political activities.
                                                                                          exempt organization that is not a
                                                                                          political organization must file Form
organizations, and business leagues as                                                    1120-POL if it is treated as having
parts of a single organization for           Line 36—Liquidation,                         political organization taxable income
purposes of meeting the nondeductible        Dissolution, Termination, or                 under section 527(f)(1).
dues exception. See Rev. Proc. 98-19.        Substantial Contraction
                                                                                             If a section 501(c) organization
Exception 2. Section 6033(e)(1)              If there was a liquidation, dissolution,     establishes and maintains a section
$2,000 in-house lobbying exception.          termination, or substantial contraction,     527(f)(3) separate segregated fund, see
An organization satisfies the $2,000         attach a statement explaining what took      the specific instructions for line 81,
in-house lobbying exception if it:           place.                                       Form 990.
   1. Did not receive a waiver for proxy         For a complete liquidation of a
                                             corporation or termination of a trust,       Section 501(c)(3) organizations. A
tax owed for the prior year,                                                              section 501(c)(3) organization will lose
   2. Did not make any political             check the Termination box in the
                                             heading of the return. On the attached       its tax-exempt status if it engages in
expenditures or foreign lobbying                                                          political activity.
expenditures during the 2007 reporting       statement, show whether the assets
year,                                        have been distributed and the date.              A section 501(c)(3) organization
   3. Incurred lobbying expenses             Also attach a certified copy of any          must pay a section 4955 excise tax for
during the 2007 reporting year               resolution, or plan of liquidation or        any amount paid or incurred on behalf
consisting only of in-house direct           termination, etc., with all amendments       of, or in opposition to, any candidate for
lobbying expenses totaling $2,000 or         or supplements not already filed. In         public office. The organization must pay
less, but excluding:                         addition, attach a schedule listing the      an additional excise tax if it fails to
                                             names and addresses of all persons           correct the expenditure timely.
   a. Any allocable overhead                 who received the assets distributed in
expenses, and                                liquidation or termination; the kinds of        A manager of a section 501(c)(3)
   b. All direct lobbying expenses of        assets distributed to each one; and          organization who knowingly agrees to a
any local council regarding legislation of   each asset’s fair market value.              political expenditure must pay a section
direct interest to the organization or its                                                4955 excise tax, unless the agreement
members.                                         A substantial contraction is a partial
                                             liquidation or other major disposition of    is not willful and there is reasonable
                                             assets except transfers for full             cause. A manager who does not agree
Definitions.                                                                              to a correction of the political
                                             consideration or distributions from
   Grassroots lobbying refers to             current income.                              expenditure may have to pay an
attempts to influence any segment of                                                      additional excise tax.
                                                 A major disposition of assets is any
the general public regarding legislative     disposition for the tax year that is:           When an organization promotes a
matters or referendums.                                                                   candidate for public office (or is used or
                                                 1. At least 25% of the fair market
    Direct lobbying includes                 value of the organization’s net assets at    controlled by a candidate or prospective
attempting to influence:                     the beginning of the tax year; or            candidate), amounts paid or incurred
• Legislation through communication              2. One of a series of related            for the following purposes are political
with legislators and other government        dispositions begun in earlier years that     expenditures:
officials, and                               add up to at least 25% of the net assets     • Remuneration to such individual (a
• The official actions or positions of       the organization had at the beginning of     candidate or prospective candidate) for
covered executive branch officials           the tax year when the first disposition in   speeches or other services;
through direct communication.                the series was made. Whether a major         • Travel expenses of such individual;
                                             disposition of assets took place through     • Expenses of conducting polls,
   Direct lobbying does not include          a series of related dispositions depends     surveys, or other studies, or preparing
attempting to influence:                     on the facts in each case.                   papers or other material for use by
• Any local council on legislation of                                                     such individual;
direct interest to the organization or its      See Regulations section 1.6043-3          • Expenses of advertising, publicity,
members, and                                 for special rules and exceptions.            and fundraising for such individual; and
• The general public regarding                                                            • Any other expense that has the
legislative matters (grassroots              Line 37—Expenditures for                     primary effect of promoting public
lobbying).                                   Political Purposes                           recognition or otherwise primarily
                                             Political organizations described in         accruing to the benefit of such
   Other lobbying includes:                                                               individual.
• Grassroots lobbying,                       section 527 are not required to
• Foreign lobbying,                          answer this question.                           An organization is effectively
• Third-party lobbying, and                      A political expenditure is one           controlled by a candidate or prospective
• Dues paid to another organization          intended to influence the selection,         candidate only if such individual has a
that were used to lobby.                     nomination, election, or appointment of      continuing, substantial involvement in
                                             anyone to a federal, state, or local         the day-to-day operations or
    In-house expenditures include:           public office, or office in a political      management of the organization.
• Salaries, and                              organization, or the election of
• Other expenses of the organization’s       Presidential or Vice Presidential                A determination of whether the
officials and staff (including amounts       electors. It does not matter whether the     primary purpose of an organization is
paid or incurred for the planning of         attempt succeeds.                            promoting the candidacy or prospective
legislative activities).                                                                  candidacy of an individual for public
                                                 An expenditure includes a payment,       office is made on the basis of all the
   In-house expenditures do not              distribution, loan, advance, deposit, or     facts and circumstances. See section
include:                                     gift of money, or anything of value. It      4955 and Regulations section 53.4955.
• Any payments to other taxpayers            also includes a contract, promise, or
engaged in lobbying or political             agreement to make an expenditure,               Use Form 4720 to figure and report
activities as a trade or business.           whether or not legally enforceable.          these excise taxes.
Specific Instructions for Form 990-EZ                          -63-
Line 38—Loans To or From                     Line 39—Section 501(c)(7)                        1. Is an auxiliary of a fraternal
Officers, Directors, Trustees,               Organizations                                 beneficiary society exempt under
and Key Employees                                                                          section 501(c)(8), and
                                             Gross receipts test. A section                   2. Limits its membership to the
Enter the end-of-year unpaid balance of      501(c)(7) organization may receive up         members of a particular religion; or the
secured and unsecured loans made to          to 35% of its gross receipts, including       membership limitation is:
or received from officers, directors,        investment income, from sources
trustees, and key employees. For                                                              a. A good-faith attempt to further the
                                             outside its membership and remain
example, if the organization borrowed                                                      teachings or principles of that religion,
                                             tax-exempt. Part of the 35% (up to 15%
$1,000 from one officer and loaned                                                         and
                                             of gross receipts) may be from public
$500 to another, none of which has                                                            b. Not intended to exclude
                                             use of a social club’s facilities.
been repaid, report $1,500 on line 38b.                                                    individuals of a particular race or color.
                                                Gross receipts are the club’s income
    For loans outstanding at the end of      from its usual activities and include:        Line 40a—Section 501(c)(3)
the year, attach a schedule as               • Charges,                                    Organizations: Disclosure of
described below. Report any interest         • Admissions,
expense on line 16 and any interest          • Membership fees,                            Excise Taxes Imposed Under
income on line 2, 4, or 8, depending on      • Dues,                                       Section 4911, 4912, or 4955
the nature of the receivable that            • Assessments, and                            Section 501(c)(3) organizations must
created the interest income.                 • Investment income (such as                  disclose any excise tax imposed during
When loans should be reported                dividends, rents, and similar receipts),      the year under section 4911 (excess
separately. In the required schedule,        and normal recurring capital gains on         lobbying expenditures), 4912
report each loan separately, even if         investments.                                  (disqualifying lobbying expenditures),
more than one loan was made to or                                                          or, unless abated, 4955 (political
                                                Gross receipts do not include:             expenditures). See sections 4962 and
received from the same person, or the
same terms apply to all loans made.
                                             • Capital contributions (see                  6033(b).
                                             Regulations section 1.118-1),
Salary advances and other advances
for the personal use and benefit of the
                                             • Initiation fees, or                         Line 40b—Section 501(c)(3)
recipient, and receivables subject to
                                             • Unusual amounts of income (such as          and 501(c)(4) organizations:
                                             the sale of the clubhouse).
special terms or arising from nontypical                                                   Disclosure of Section 4958
transactions, must be reported as                     College fraternities or sororities   Excess Benefit Transactions
separate loans for each officer, director,
trustee, and key employee.                     !      or other organizations that
                                              CAUTION charge membership initiation
                                                                                           and Excise Taxes
                                                                                           Sections 6033(b) and 6033(f) require
When loans should be reported as a           fees, but not annual dues, do include         section 501(c)(3) and (4) organizations
single total. In the required schedule,      initiation fees in their gross receipts.      to report the amount of taxes imposed
report receivables that are subject to                                                     under section 4958 (excess benefit
the same terms and conditions                    If the 35% and 15% limits do not
                                             affect the club’s exempt status, include      transactions) involving the organization,
(including credit limits and rate of                                                       unless abated, as well as any other
interest) as receivables due from the        the income shown on line 39b on the
                                             club’s Form 990-T.                            information the Secretary may require
general public (occurring in the normal                                                    concerning those transactions. See
course of the organization’s operations)        Investment income earned by a              General Instruction P for a discussion
as a single total for all the officers,      section 501(c)(7) organization is not         of excess benefit transactions.
directors, trustees, and key employees.      tax-exempt income unless it is set aside
Report travel advances for official          for:                                             Attach a statement describing any
business of the organization as a single     • Religious,                                  excess benefit transaction, the
total.                                       • Charitable,                                 disqualified person or persons involved,
Schedule format. For each                    • Scientific,                                 and whether or not the excess benefit
outstanding loan or other receivable         • Literary,                                   transaction was corrected.
that must be reported separately, the        • Educational purposes, or
attached schedule should show the            • Prevention of cruelty to children or        Line 40c—Taxes Imposed on
following information (preferably in         animals.                                      Organization Managers or
columnar form):                                 If the combined amount of an
                                                                                           Disqualified Persons
• Borrower’s name and title,                 organization’s gross investment income        For line 40c, enter the amount of taxes
• Original amount,                           and other unrelated business income           imposed on organization managers or
• Balance due,                               exceeds $1,000, it must report the            disqualified persons under sections
• Date of note,                              investment income and other unrelated         4912, 4955, and 4958, unless abated.
• Maturity date,                             business income on Form 990-T.
• Repayment terms,                                                                         Line 40d—Taxes Reimbursed
• Interest rate,                             Nondiscrimination policy. A section           By the Organization
• Security provided by the borrower,         501(c)(7) organization is not exempt
                                                                                           For line 40d, enter the amount of tax on
• Purpose of the loan, and                   from income tax if any written policy
                                                                                           line 40c that was reimbursed by the
• Description and fair market value of       statement, including the governing
                                                                                           organization. Any reimbursement of the
the consideration furnished by the           instrument and bylaws, allows
                                             discrimination on the basis of race,          excise tax liability of a disqualified
lender (for example, cash — $1,000; or                                                     person or organization manager will be
100 shares of XYZ, Inc., common              color, or religion.
                                                                                           treated as an excess benefit unless (1)
stock — $9,000).                                However, section 501(i) allows social      the organization treats the
    The above detail is not required for     clubs to retain their exemption under         reimbursement as compensation during
receivables or travel advances that may      section 501(c)(7) even though their           the year the reimbursement is made,
be reported as a single total. However,      membership is limited (in writing) to         and (2) the total compensation to that
report and identify those totals             members of a particular religion, if the      person, including the reimbursement, is
separately in the attachment.                social club:                                  reasonable.
                                                                -64-                        Specific Instructions for Form 990-EZ
Line 40e—Tax on Prohibited                           or signature or other authority over a         Form TD F 90-22.1 is available by
Tax Shelter Transactions                             financial account in a foreign country      calling 1-800-TAX-FORM
                                                     (such as a bank account, securities         (1-800-829-3676) or by downloading it
Answer “Yes” if the organization was a
                                                     account, or other financial account);       from the IRS website at www.irs.gov.
party to a prohibited tax shelter
                                                     and                                         Do not file it with the IRS or attach it to
transaction as described in section
                                                         a. The combined value of the            Form 990-EZ.
4965(e) at any time during the tax year.
See General Instruction W for                        accounts was more than $10,000 at           Line 43—Section 4947(a)(1)
information about prohibited tax shelter             any time during the calendar year; and      Nonexempt Charitable Trusts
transactions.                                            b. The accounts were not with a
                                                     U.S. military banking facility operated     Section 4947(a)(1) nonexempt
   If the organization answered “Yes,” it                                                        charitable trusts that file Form 990-EZ
                                                     by a U.S. financial institution.
must complete Form 8886-T.                                                                       instead of Form 1041 and have no
                                                         2. The organization“Yes” to item 1
Line 41—List of States                               above.                                      taxable income under Subtitle A may
                                                                                                 use Form 990-EZ to meet its Section
List each state with which the                         If the “Yes” box is checked, enter the    6012 filing requirement by checking the
organization is filing a copy of this                name of the foreign country or              box on line 43. Also, enter on line 43
return in full or partial satisfaction of            countries. Attach a separate sheet if       the total of exempt-interest dividends
state filing requirements.                           more space is needed. File Form TD F        received from a mutual fund or other
Line 42b—Foreign Financial                           90-22.1 by June 30, 2008, with the          regulated investment company as well
Accounts                                             Department of the Treasury at the           as tax-exempt interest received directly.
Check the “Yes” box if either 1 or 2                 address shown on the form.
below applies:
   1. At any time during the calendar
year, the organization had an interest in
Privacy Act and Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal
Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying
with these laws. Section 6109 requires return preparers to provide their identifying numbers on the return.
   The organization is not required to provide the information requested on a form that is subject to the Paperwork Reduction
Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be
retained as long as their contents may become material in the administration of any Internal Revenue law. The rules
governing the confidentiality of the Form 990, and Form 990-EZ, are covered in Code section 6104.
   The time needed to complete and file this form and related schedules will vary depending on individual circumstances. The
estimated average times are:
Form                                    Recordkeeping             Learning about the law or       Preparing            Copying, assembling,
                                                                          the form                   the               and sending the form
                                                                                                    form                    to the IRS

990                                         112 hr., 52 min.            16 hr., 4 min.          22 hr., 20 min.             1 hr., 4 min.
990-EZ                                      29 hr., 10 min.            11 hr., 33 min.          14 hr., 24 min.               32 min.
Schedule A (Form 990 or 990-EZ)             75 hr., 19 min.            11 hr., 37 min.          13 hr., 21 min.                 -0-
Schedule B (Form 990, 990-EZ, or             4 hr., 46 min.              1 hr., 23 min.          1 hr., 31 min.                 -0-
990-PF)

  We welcome comments on forms. If you have comments concerning the accuracy of these time estimates or
suggestions for making these forms simpler, we would be happy to hear from you. You can write to the Internal Revenue
Service, Tax Products Coordinating Committee, SE:W:CAR:MP:T:T:SP, 1111 Constitution Ave. NW, IR-6526, Washington,
DC 20224.
  Do not send the form to this address. Instead, see When, Where, and How To File in General Instruction H.




Specific Instructions for Form 990-EZ                                  -65-
Index


A                                                       Compensation . . . . . . 17, 34, 59                   Disregarded entities . . . . . . 3, 24,                      Postage . . . . . . . . . . . . . . . . . . 35
Accounting:                                               Certain disqualified                                                                                 52          Printing . . . . . . . . . . . . . . . . . . . 35
   Fees . . . . . . . . . . . . . . . . . . . . . 35        persons . . . . . . . . . . . . . . . . 34        Dissolution . . . . . . . . . . . . . . 43, 63               Program service . . . . . . 31, 32
   Method . . . . . . . . . . . . . . . . . . . 54        Current officers . . . . . . . . . . . 34           Distributions:                                               Shipping . . . . . . . . . . . . . . . . . . 35
   Period . . . . . . . . . . . . . . . . . . . . . 7     Disqualified persons . . . . . . 34                   Disqualified persons . . . . . . 34                        Supplies . . . . . . . . . . . . . . . . . . 35
Accounting fees . . . . . . . . . . . . . 60              Former officers . . . . . . . . . . . 34            Dividends . . . . . . . . . . . . . . . 29, 51               Telephone . . . . . . . . . . . . . . . . 35
Accounting method . . . . . 7, 8, 25                      Other persons . . . . . . . . . . . . 34            Documents, changes in                                      Extension of time to file . . . . . . . 8
Accounting period . . . . . . . 24, 54                  Completing the header . . . . . 24,                     organizing . . . . . . . . . . . . 43, 62
Accounts payable . . . . . . . . . . . 39                                                                54   Donations . . . . . . . . . . . . 7, 44, 56                F
Accounts receivable . . . . . . . . . 37                Completing the return:                                Donor advised funds . . . . 16, 27                         Fair market value . . . . . . . . . . . 16
Activities, change in . . . . . 43, 62                    Rounding off to whole                                 Disqualified person . . . . . . . 50                     Federated fundraising
Address and name . . . . . . . . . . 54                     dollars . . . . . . . . . . . . . . . . . 22        Exception . . . . . . . . . . . . . . . . . 27              agencies . . . . . . . . . . . . . . . . . 31
Address, change . . . . . . . . 24, 54                  Contemporaneous . . . . . . . . . . 11                  Excess benefit                                           Fees . . . . . . . . . . . . . . . . . . . . . . . 60
Address, Website . . . . . . . . . . . 55               Contracts, initial . . . . . . . . . . . . . 18            transaction . . . . . . . . . . . . . 17                 Accounting . . . . . . . . . . . . . . . 35
                                                        Contributions . . . . 9, 25, 26, 27,                    Excess business                                             Copies . . . . . . . . . . . . . . . . . . . 14
Administrative expenses . . . . . 59                                                                               holdings . . . . . . . . . . . . . . . . 50
                                                                     28, 30, 45, 55, 56, 58                                                                                 Fundraising . . . . . . . . . . . . . . . 35
Affiliated organizations . . . . . . 16                                                                         Grants . . . . . . . . . . . . . . . . . . . . 33
                                                         Acknowledgment . . . . . . . . . 10                                                                                Government agencies . . . . . 51
Affiliates . . . . . . . . . . . . . . . . . . . . 59    Co-venture . . . . . . . . . . . . . . . 56            Sponsoring                                                  Legal . . . . . . . . . . . . . . . . . . . . . 35
   Expenses . . . . . . . . . . . . . . . . . 31         Definitions . . . . . . . . . . . . . . . . 11            organization . . . . . . . . . . . . 27
   Payments . . . . . . . . . . . . . . . . 31                                                                                                                           Figuring gross receipts . . . . . . 4,
                                                         Direct public support . . . . . . 27                 Dues . . . . 28, 45, 46, 47, 51, 56,                                                                            25
   Purchases . . . . . . . . . . . . . . . . 31                                                                                                                57
                                                         Disclosure statement . . . . . . 10                                                                             Filing tests . . . . . . . . . . . . . . . . . . . 2
   State or national                                                                                            Membership . . . . . . 56, 57, 59
      organizations . . . . . . . . . . . 31             Donation of services . . . . . . 26                                                                             Final return . . . . . . . 8, 43, 54, 63
                                                         Donor advised funds . . . . . . 27                     Notices . . . . . . . . . . . . . . . . . . . 45
  Voluntary awards or                                                                                                                                                    Fixed payment . . . . . . . . . . . . . . 18
      grants . . . . . . . . . . . . . . . . . . 31      Fundraising records . . . . . . . . 9                                                                           Foreign accounts . . . . . . . . . . . 50
Allocations . . . . . . . . . . . . . . . . . . 33       Government . . . . . . . . . . . . . . 56            E                                                          Foreign organizations . . . . . . . 20
   Grants, and . . . . . . . . . . . . . . . 33          Government grants . . . . . . . 27
                                                                                                              Electronic filing . . . . . . . . . . . . . . . 8          Form 1041 . . . . . . . . . . . . . . . . . . . 5
                                                         Grants . . . . . . . . . . . . . . . . 26, 56
Alternate test . . . . . . . . . . . . . . . . 2                                                              Employee benefit plans (section                            Form 1098 . . . . . . . . . . . . . . . . . . . 5
                                                          Indirect . . . . . . . . . . . . . . . . . . . 56
Amended returns . . . . . . 7, 8, 54                                                                            501(c)(9), (17), or (18)) . . . . . 7                    Form 1099 series . . . . . . . . . . . . 5
                                                          Indirect public support . . . . . 27
Analysis of Income-Producing                              Insubstantial value . . . . . . . . 10              Employee benefits . . . . . . . . . . 34                   Form 1120-POL . . . . . . . . . . . . . . 6
   Activities . . . . . . . . . . . . . . . . . 50        Membership dues . . . . . . . . . 56                Employees, key . . . . . . . . . . . . . 61                Form 990 header:
Anti-abuse rule . . . . . . . . . . . . . . . 3           Noncash . . . . . . . . . . . . . . . . . 10        Employer identification number                                Amended returns . . . . . . . . . 24
Applicable insurance                                      Nondeductible . . . . . . . . . . . . . 9             (EIN):                                                      Application pending . . . . . . . 24
   contract . . . . . . . . . . . . . . . . . . 49        Quid pro quo . . . . . 10, 11, 44                     Disregarded entities . . . . . . . 24                       Final return . . . . . . . . . . . . . . . 24
   Applicable exempt                                      Special events . . . . . . . . . . . . 30             Section 501(c)(9)                                           Name and address . . . . . . . . 24
      organization . . . . . . . . . . . . 49             Sponsoring                                               organizations . . . . . . . 24, 54                    Form 990-T . . . . . . . . . . . . . . . . . . 5
Application pending . . . . . . 3, 54                       organization . . . . . . . . . . . . 27           Equipment . . . . . . . . . . . . . . . . . . 38           Form LM-2 and LM-3, Labor
Assembling and completing                                 Substantiation and                                  Erroneous backup                                              Organization Annual
   Form 990 or Form                                         disclosure . . . . . . . . . . . . . . 10           withholding . . . . . . . . . . . . . . . 20                Report . . . . . . . . . . . . . . . . . . . . . 7
   990-EZ . . . . . . . . . . . . . . . . 22-24           Sweepstakes, raffles, and                           Excess benefit                                             Former officers, directors,
Assessments . . . . . . . 28, 47, 51                        lotteries . . . . . . . . . . . . . . . . 30        transaction . . . . 15-20, 17, 49                           trustees, and key employees,
Assets . . . . . . . . . . . 29, 38, 57, 60               Use of property . . . . . . . . . . . 26              Churches . . . . . . . . . . . . . . . . . 19               list of . . . . . . . . . . . . . . . . . . . . . 42
Assets, net . . . . . . . . . . . . . 39, 60            Contributors, schedule of . . . . 9,                    Correction . . . . . . . . . . . . . . . . 19            Forms and publications . . . . . . . 5
Assistance to individuals . . . . 34                                                                     56     Donor advised funds . . . . . 17,                        Functional expenses . . . . . . . . 32
                                                        Controlled entities . . . . . . . . . . . 52                                                               19       Allocating indirect . . . . . . . . . 32
Attachments . . . . . . . . . . . . . . . . 23
                                                                                                                Excess payment . . . . . . . . . . 19                       Fundraising . . . . . . . . . . . . . . . 32
Audit guides . . . . . . . . . . . . . . . . . 7                                                                Excise tax . . . . . . . . . . . . . . . . 64               Management and
                                                        D                                                       Insufficient payment . . . . . . . 19                          general . . . . . . . . . . . . . . . . . 32
B                                                       Deferred charges . . . . . . . . . . . 38               Revenue sharing                                             Program service . . . . . . . . . . 32
Backup withholding . . . . . . . . . 20                                                                            transactions . . . . . . . . . . . . 19               Fund balances . . . . . . 31, 40, 60
                                                        Deferred revenue . . . . . . . . . . . 39
                                                                                                                Revocation of
Balance sheets . . . . . . . . . 36, 60                 Definition, key employee . . . . 40                        exemption . . . . . . . . . . . . . . 19              Fundraising . . . . . . . . . . . . . . . . . 32
Benefits:                                               Depletion expense . . . . . . . . . . 35                Section 4958 . . . . . . . . . . . . . 64                   Expenses . . . . . . . . . . . . . . . . . 31
  Disregarded . . . . . . . . . . . . . . 17            Depreciation expense . . . . . . . 35                                                                               Fees . . . . . . . . . . . . . . . . . . . . . 35
                                                                                                              Excess business                                               Records for tax deductible
  Employee . . . . . . . . . . . . . . . . 59           Direct expenses . . . . . . . . . . . . . 58            holdings . . . . . . . . . . . . . . . . . . 49
  Members . . . . . . . . . . . . . 34, 59                                                                                                                                     contributions . . . . . . . . . . . . 9
                                                        Direct public support . . . . . . . . 27              Excise taxes . . . . . . . . 18, 49, 64
Bonds, tax-exempt . . . . . . . . . . 39                                                                                                                                 Funds, current . . . . . . . . . . . . . . 40
                                                        Disclosure:                                           Exempt function:
Bonus, discretionary . . . . . . . . 18                   Contributions . . . . . . . . . . . . . 10            Political organization . . . . . . 20
                                                          Excess business                                     Exempt organizations, types                                G
C                                                           holdings . . . . . . . . . . . . . . . . 49         of . . . . . . . . . . . . . . . . . . . . . . . . . 4   Gaming . . . . . . . . . . . . . . . . . 30, 58
Capital stock accounts . . . . . . 40                     Federal government material,                        Exempt purposes:                                           GEN (Group exemption
                                                            sale . . . . . . . . . . . . . . . . . . . . 15     Activities . . . . . . . . . . . . . . . . . 51            number) . . . . . . . . . . . . . . 25, 54
Capital surplus . . . . . . . . . . . . . . 40
                                                          Prohibited tax shelter                              Expenses . . . . . . . 29, 31, 32, 35,                     Gifts . . . . . . . . . . . . . . . . 25, 27, 55
Cash . . . . . . . . . . . . . . . . . . . 37, 60           transactions . . . . . . . . . . . . 21
Change of address . . . . . . 24, 54                                                                             36, 38, 39, 47, 48, 58, 59, 60,                         Government:
                                                          Section 501(c)(3)                                                                                        63      Contracts . . . . . . . . . . . . . . . . . 51
Change of name . . . . . . . . 24, 54                       organizations . . . . . . . . . . . 15                                                                         Contributions . . . . . . . . . 27, 56
                                                                                                                Allocating indirect . . . . . . . . . 32
Changes in net assets . . . . . . . 60                    Services furnished . . . . . . . . 15                 Equipment rental and                                       Fees . . . . . . . . . . . . . . . . . . . . . 51
Checklist for a properly                                  Statement . . . . . . . . . . . . . . . . 11             maintenance . . . . . . . . . . . 35                    Grants . . . . . . . . . . . . . . . . 27, 56
  completed return . . . . . . 23, 24                     Transactions and                                      Fundraising . . . . . . . . . . . 31, 32                 Grants . . . . . . 25, 27, 33, 55, 56,
Children, photographs of                                    relationships . . . . . . . . . . . . 15            Management and                                                                                            59
  missing . . . . . . . . . . . . . . . . . . . . 2     Disqualified persons . . . . 16, 49,                       general . . . . . . . . . . . . . 31, 32                Allocations, and . . . . . . . . . . . 33
Colleges and universities . . . . 28                                                                     64     Occupancy . . . . . . . . . . . . . . . 35                 Contributions . . . . . . . . . . . . . 56
Commercial co-venture . . . . . . 27                    Disregarded benefits . . . . . . . . 17                 Political . . . . . . . . . . . . . . . 44, 63             Donor advised funds . . . . . . 33

                                                                                                         -66-                                                                                                        Index
Grants (Cont.)                                         Loans:                                                  Political:                                                Revenue . . . . . . . . . . . . 31, 39, 51
  Equivalent to                                          Officers, directors, et                                 Expenses . . . . . . . . . . . . . 44, 47                 Special events . . . . . . . . . . . . 30
    contributions . . . . . . . 26, 56                      al . . . . . . . . . . . . . . . . . . 39, 64      Political organization . . . . . 3, 20                      Sweepstakes, raffles, and
  Government                                             Receivable . . . . . . . . . . . . . . . 37             Penalties . . . . . . . . . . . . . . . . . 12              lotteries . . . . . . . . . . . . . . . . 30
    contributions . . . . . . . . . . . 27             Lobbying:                                                 Public inspection . . . . . . . . . . 12                Revenue, Expenses, and
  Payable . . . . . . . . . . . . . . . . . . 39         Cost allocation . . . . . . . . . . . . 45            Postage expense . . . . . . . . . . . 60                    Changes in Net Assets or
  Receivable . . . . . . . . . . . . . . . 37            Direct . . . . . . . . . . . . . . . . . . . . 63     Premiums . . . . . . . . . . . . . . . . . . . 3            Fund Balances . . . . . . . . . . . 55
Gross receipts . . . . 2, 48, 55, 64                     Expenses . . . . . . . . . . . . . 46, 47             Prepaid expenses . . . . . . . . . . . 38                 Revenue, program
  $25,000 or less . . . . . . . . . . . 25               Grassroots . . . . . . . . . . . . . . . 63           Printing expense . . . . . . . . . . . . 60                 service . . . . . . . . . . . . . . . 56, 57
  Acting as agent . . . . . . . . . . . . 4              In-house expenditures . . . . 63                                                                                Revenue, special
                                                                                                               Private delivery services . . . . . . 8
  Figuring . . . . . . . . . . . . . . . . . . 25      Lobbying expenses . . . . 48, 62,                                                                                   events . . . . . . . . . . . . 30, 55, 58
                                                                                                               Program service
Gross receipts test . . . . . . . . . . . 4                                                              63                                                              Revocation of exemption . . . . 19
                                                                                                                 accomplishments, statement
  $25,000 . . . . . . . . . . . . . . . . . . . 4      Lotteries . . . . . . . . . . . . . . . . . . . . 58      of . . . . . . . . . . . . . . . . . . . . . . . . 60
  $5,000 . . . . . . . . . . . . . . . . . . . . 4                                                             Program service
Gross rents . . . . . . . . . . . . . . . . . 29                                                                                                                         S
                                                       M                                                         expenses . . . . . . . . . . . . . 31, 32
Group exemption                                                                                                                                                          Salaries of employees . . . . . . . 34
                                                       Maintenance expense . . . . . . . 60                    Program service
  number . . . . . . . . . . . . . . . 25, 54                                                                    revenue . . . . . . . 28, 51, 56, 57                    Sales of inventory . . . . . . . 28, 30
Group return . . . . . . . . . . . . 20, 25            Management and general                                                                                            Savings . . . . . . . . . . . . . . . . . . . . . 60
                                                                                                                 Government fees and
                                                         expenses . . . . . . . . . . . . . 31, 32                                                                       Schedule A . . . . . . . . 2, 5, 26, 56
                                                                                                                    contracts . . . . . . . . . . . 28, 56
                                                       Medicare and Medicaid                                     Insurance premiums . . . . . . 28                       Schedule B . . . . 5, 9, 25, 28, 54,
H                                                        payments . . . . . . . . . . . . . . . . . 51           Investment . . . . . . . . . . . . . . . 56                                                               56
Header . . . . . . . . . . . . . . . . . . . . . 24    Meetings, expense of . . . . . . . 35                     Investments . . . . . . . . . . . . . . 28              Schedule of contributors . . . . . 9,
Help by phone . . . . . . . . . . . . . . . 1          Membership . . . . . . . . . . . . 31, 59                 Medicaid . . . . . . . . . . . . . 28, 56                                                   25, 28, 56
Hospitals . . . . . . . . . . . . . . . . . . . 28       Assessments . . . . . . . . . 28, 57                    Medicare . . . . . . . . . . . . . 28, 56               Section 4911, 4912, or
                                                         Benefits . . . . . . . . . . . . . . 34, 59             Section 501(c)(15)                                        4955 . . . . . . . . . . . . . . . . . 49, 64
                                                         Dues . . . . . . . . . . 27, 28, 45, 57                    organization . . . . . . . . . . . . 28              Section 4947(a)(1) trusts . . . . 3,
I                                                      Miscellaneous expenses,                                   Unrelated trade or business                                                                        50, 65
Income:                                                  reporting for state . . . . . . . . . 36                   activities . . . . . . . . . . . . . . . . 28        Section 4958 . . . . . . . . . 15-20, 49
   Investment . . . . . . . . . . . . . . . 57         Mortgages payable . . . . . . . . . . 39                Prohibited tax shelter                                    Section 4958, excise taxes:
   Unrelated business . . . . . . 43,                                                                            transactions . . . . . . . . . . . . . . 21               Disqualified persons . . . . . . 18
                                                  62                                                             Entity managers . . . . . . . . . . 21                    Organization
Income-Producing Activities:                           N                                                         Entity managers excise                                      managers . . . . . . . . . . . . . . 18
   Analysis . . . . . . . . . . . . . . . . . . 50     Name and address . . . . . . . . . . 54                      tax . . . . . . . . . . . . . . . . . . . . . 22
                                                                                                                                                                         Section 501(a), (e), (f), (k), and
Indirect public support . . . . . . . 27               Name change . . . . . . . . . . . 24, 54                  Entity-level excise tax . . . . . 22
                                                                                                                                                                           (n) organizations . . . . . . . . . . . 2
Information Regarding Taxable                          Net assets . . . . . . . 31, 39, 40, 60                   Required disclosure . . . . . . . 22
                                                                                                                 Tax-exempt entities . . . . . . . 21                    Section 501(c)(12)
   Subsidiaries and Disregarded                        Nondeductible dues . . . . 45, 46,                                                                                  organizations . . . . . . . . . . . . . 48
   Entities . . . . . . . . . . . . . . . . . . . 52                                                      47   Proxy tax . . . . . . . . . . . . . . . 45, 47
                                                                                                                                                                         Section 501(c)(15)
Information Regarding Transfers                        Nondiscrimination policy . . . . 48,                    Public inspection . . . . . . . . . 12-15
                                                                                                                                                                           organizations . . . . . . . . . . . . . . 2
   Associated With Personal                                                                               64   Public interest law firms . . . . . 20
                                                                                                                                                                         Section 501(c)(3) . . . . . . 26, 44,
   Benefit Contracts . . . . . . . . . 52              Nonexempt charitable                                    Publication 78, Cumulative list of                                                                   56, 63
Initial contracts . . . . . . . . . . . . . . 18         trusts . . . . . . . . . . . . . . . . . . . . . 50     section 170(c)                                            Applicable
Initial return . . . . . . . . . . . . . 24, 54        Notes payable . . . . . . . . . . . . . . 39              organizations . . . . . . . . . . . . . . 3                 organization . . . . . . . . . . . . 16
Interest . . . . . . . . . . . . . 29, 35, 51          Notes receivable . . . . . . . . . . . . 37             Publications and forms . . . . . . . 5                      Disclosure of transactions and
Intermediate Sanction                                  Number of employees . . . . . . . 50                    Publicly traded securities . . . . 38                         relationships . . . . . . . . . . . . 15
   Regulations . . . . . . . . . . . . 15-20                                                                   Purchases from affiliates . . . . 31                        Excess benefit
Inventory . . . . . . . . . . . . . . . . . . . 59                                                             Purpose of form . . . . . . . . . . . . . . 1                 transaction . . . . . . . . . . . . . 64
                                                       O                                                                                                                 Section 501(c)(4):
Investment . . . . . . . . . . 29, 38, 60
   Dividend . . . . . . . . . . . . . . . . . . 57     Occupancy expense . . . . . . . . 60                                                                                Applicable
                                                       Officers, directors, trustees, and                      Q                                                             organization . . . . . . . . . . . . 16
   Interest . . . . . . . . . . . . . . . . . . . 57
   Program- related . . . . . . . . . . 56               key employees, list of . . . . 40,                    Qualified state or local political                          Excess benefit
                                                                                                        61       organizations . . . . . . . . . . . . . . 3                 transaction . . . . . . . . . . . . . 64
   Rents . . . . . . . . . . . . . . . . . . . . 57
   Savings and temporary                               Organization(s):                                        Quid pro quo                                                Lobbying expenses . . . . . . 45,
      cash . . . . . . . . . . . . . . . . . . . 37      Affiliated . . . . . . . . . . . . . . . . . . 16       contribution . . . . . . . . . . . . . . . 11                                                             62
                                                         Foreign countries, in . . . . . . 20                                                                              Membership dues . . . . . 45, 62
                                                         Managers . . . . . . . . . . . . 49, 64                                                                           Political expenses . . . . . 45, 62
J                                                        Not required to file . . . . . . . . . 3              R                                                         Section 501(c)(5):
Joint costs . . . . . . . . . . . . . . . . . . 36       Relation to other . . . . . . . . . . 44              Raffles . . . . . . . . . . . . . . . . . . . . . . 58      Lobbying expenses . . . . . . 45,
                                                         Type . . . . . . . . . . . . . . . . . 25, 55         Reasonableness, presumption                                                                                 62
                                                         U.S. possessions, in . . . . . . 20                     of . . . . . . . . . . . . . . . . . . . . . . . . 18     Membership dues . . . . . 45, 62
K                                                                                                              Rebuttable presumption . . . . . 18                         Political expenses . . . . . 45, 62
Key employee . . . . . . . . . . . . . . 40                                                                    Receivable . . . . . . . . . . . . . . . . . 64           Section 501(c)(6):
                                                       P                                                         Account . . . . . . . . . . . . . . . . . . 37
                                                       Paid preparer . . . . . . . . . . . . . . . 22                                                                      Lobbying expenses . . . . . . 45,
                                                                                                                 Grants . . . . . . . . . . . . . . . . . . . . 37                                                         62
L                                                      Paid-in capital . . . . . . . . . . . . . . . 40          Pledges . . . . . . . . . . . . . . . . . . 37            Membership dues . . . . . 45, 62
Labor organizations (section                           Paperwork reduction act                                 Reconciliation                                              Political expenses . . . . . 45, 62
  501(c)(5)) . . . . . . . . . . . . . . . . . . 7       notice . . . . . . . . . . . . . . . . . . . . 65       statements . . . . . . . . . . . . . . . 40             Section 501(c)(7)
Land, buildings and                                    Payables . . . . . . . . . . . . . . . 39, 64           Recordkeeping . . . . . . . . . . . . . . 22                organizations . . . . . . . . . 48, 64
  equipment . . . . . . . . . . . . 38, 60             Payments to affiliates . . . . . . . 31                 Relationship of Activities to the                         Section 501(c)(9)
Land, buildings, and                                   Payroll taxes . . . . . . . . . . . . . . . . 34          Accomplishment of Exempt                                  organizations . . . . . . . . . 24, 54
  equipment . . . . . . . . . . . . . . . . 40         Penalties . . . . . . . . . . . . . . 5, 9, 12            Purposes . . . . . . . . . . . . . . . . . 51           Section 501(c)(9), (17), (18)
Legal fees . . . . . . . . . . . . . . 35, 60          Pension plan                                            Rent expense . . . . . . . . . . . 29, 60                   organizations . . . . . . . . . 26, 56
Liquidation . . . . . . . . . . . . . . 43, 63           contributions . . . . . . . . . . . . . . 34          Rental income (loss) . . . . . . . . 51                   Section 6033(e):
List of Officers, Directors,                           Personal benefit                                        Requirements for a properly                                 Exceptions, in-house
  Trustees, and Key                                      contracts . . . . . . . . . 20, 52, 62                  completed Form 990 or Form                                  lobbying . . . . . . . . . . . . . . . . 63
  Employees . . . . . . . . . . . 40, 61               Phone help . . . . . . . . . . . . . . . . . . 1          990-EZ . . . . . . . . . . . . . . . . 22-24              Exceptions, nondeductible
List of states . . . . . . . . . . . . . . . . 50      Pledges receivable . . . . . . . . . . 37               Retained earnings . . . . . . . . . . . 40                    dues . . . . . . . . . . . . . . . . . . . 62

Index                                                                                                     -67-
Section 6033(e): (Cont.)                               Sponsoring organization . . . . . 27                    T                                                      Trusts, section
  Reporting requirements and                           State filing requirement . . . . . . . 6                Tax Forms Committee . . . . . . . 65                     4947(a)(1) . . . . . . . . . . . . . 3, 65
     proxy tax . . . . . . . . . . . . . . . 62        State, reporting to . . . . . . 6, 8, 36                Taxable subsidiaries . . . . . . . . 52
Securities . . . . . . . . . . . . . . . 29, 57        Statement of Functional                                 Taxes, reimbursement of . . . . 64                     U
SFAS 116 . . . . . . . . . . 31, 33, 55                  Expenses . . . . . . . . . . . . . . . . . 32         Tax-exempt bond                                        Unrelated business
SFAS 117 . . . . . . . . . . . . . . . . . . 39        Statement of Position                                     liabilities . . . . . . . . . . . . . . . . . . 39     income . . . . . . . . . . . . . . . 43, 62
Shipping expense . . . . . . . . . . . 60                98-2 . . . . . . . . . . . . . . . . . . . . . . 36   Tax-exempt organization, public                        Unrelated trade or business
Signature . . . . . . . . . . . . . . . . . . . 22     Statement of program service                              inspection rules . . . . . . . . . . . 12              activities . . . . . . . . . . . . . . 28, 56
Solicitations of                                         accomplishments . . . . . 36, 60                      TE/GE EO                                               Utilities expense . . . . . . . . . . . . 60
  contributions . . . . . . . . . . . . . . 45         Substantial contributor . . . . . . 16                    Determinations . . . . . . . . . . . . 2
Solicitations of nondeductible                         Substantial influence . . . . . . . . 16                Telephone number . . . . . . 24, 54                    W
  contributions . . . . . . . . . . . . . . . 9        Substantiation . . . . . . . . . . . . . . 11           Termination . . . . . . . . . . . . . 43, 63           Wages of employees . . . . . . . . 34
Special events . . . . . . 26, 27, 30,                 Substitute forms for Form 990 or                        Test, facts and
                                           55, 58                                                                                                                     Website address . . . . . . . . 25, 55
                                                         Form 990-EZ . . . . . . . . . . . . . . 7               circumstances . . . . . . . . . . . . 16
  Sales . . . . . . . . . . . . . . . . . . . . . 30                                                                                                                  Who must file . . . . . . . . . . . . . . . . 2
                                                       Supporting organization . . . . 16,                     Transfers:
Specific instructions for Form                                                                            17     Controlled entities . . . . . . . . . 52             Withholding:
  990 (See also Table of                                 Excess business                                         Personal benefit                                       Backup . . . . . . . . . . . . . . . . . . . 20
  Contents for these specific
  instructions.) . . . . . . . . . . . . . . 24
                                                            holdings . . . . . . . . . . . . . . . . 50             contracts . . . . . . . . . . . . . . . 20                                                     ■
                                                       Sweepstakes, raffles, and                               Travel expense . . . . . . . . . . . . . 35
Specific Instructions for Form                           lotteries . . . . . . . . . . . . . . 30, 58          Trust fund recovery
  990-EZ (See also Table of                                                                                      penalty . . . . . . . . . . . . . . . . . . . . 5
  Contents for these specific                                                                                  Trust principal account . . . . . . 40
  instructions.) . . . . . . . . . . . . . . 54




                                                                                                          -68-                                                                                               Index

				
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