i990ez 1994 by r3zmC0


									                                                                                                    “key employee” is further defined by span
                                                     Department of the Treasury                     of control.
                                                     Internal Revenue Service                       ● A section 501(c) organization that
                                                                                                    maintains a section 527(f)(3) separate
                                                                                                    segregated fund should disregard the

Instructions for Form 990-EZ                                                                        fund’s political expenditures and Form
                                                                                                    1120-POL filing requirement when
                                                                                                    answering question 37.
Short Form Return of Organization
Exempt From Income Tax                                                                              General Instructions
Under section 501(c) of the Internal Revenue Code (except black lung benefit                        Note: An organization’s completed Form
trust or private foundation) or section 4947(a)(1) nonexempt charitable trust                       990-EZ (except for the schedule of
For organizations with gross receipts of less than $100,000 and total assets                        contributors) is available for public
                                                                                                    inspection as required by section 6104.
of less than $250,000 at the end of the year.                                                       Some members of the public rely on Form
Section references are to the Internal Revenue Code unless otherwise indicated.                     990-EZ as the primary or sole source of
                                                                                                    information about a particular organization.
Paperwork Reduction Act Notice.—We ask for the information on this form to carry out                How the public perceives an organization in
the Internal Revenue laws of the United States. You are required to give us the                     such cases may be determined by the
information. We need it to ensure that you are complying with these laws.                           information presented on its return.
   The times needed to complete and file these forms will vary depending on individual              Therefore, please make sure the return is
circumstances. The estimated average times are:                                                     complete and accurate and fully describes
                                                                                    Copying,        the organization’s programs and
                                   Learning about           Preparing             assembling,       accomplishments.
                                   the law or the               the              and sending           Section 501(c)(3), 501(e), (f), and (k)
Form         Recordkeeping              form                   form           the form to the IRS   exempt organizations and section
990-EZ       27 hr., 1 min.         7 hr., 13 min.          8 hr., 55 min.           16 min.        4947(a)(1) nonexempt charitable trusts
Schedule A    44 hr., 58 min.        9 hr., 8 min.         10 hr., 17 min.            -0-           must also attach a completed Schedule
(Form 990)                                                                                          A (Form 990) to their Form 990-EZ (or
   If you have comments concerning the accuracy of these time estimates or suggestions              Form 990).
for making these forms simpler, we would be happy to hear from you. You can write to
the Internal Revenue Service, Attention: Tax Forms Committee, PC:FP, Washington, DC                 Purpose of Form
20224. DO NOT send the form to this address. Instead, see When and Where To File on
page 5.                                                                                             Form 990-EZ, an annual information return,
                                                                                                    is a shortened version of Form 990, Return
                                                                                                    of Organization Exempt From Income Tax.
Contents                                 Page    Changes To Note                                    It is designed for use by small tax-exempt
●   Changes To Note                         1                                                       organizations and nonexempt charitable
●   General Instructions                  1–7    ● Tax exemption for all group legal service        trusts to provide the IRS with the
A   Who Must File                           1    trusts and organizations described in              information required by section 6033.
B   Exempt Organization Reference Chart 2        section 501(c)(20) expired for taxable years
                                                 beginning after June 30, 1992. All such               This form may be used to transmit
C   Organizations Not Required To File      2                                                       elections that are required to be submitted
                                                 trusts and organizations must now file the
D   Forms and Publications To File or Use 3
                                                 appropriate income tax return instead of           to the IRS, such as the election to
E   Use of Form 990-EZ To Satisfy State          Form 990-EZ (or Form 990).                         capitalize costs under section 266.
    Reporting Requirements                  3
F   Other Forms as Partial Substitutes for       ● Temporary Regulations section
    Form 990-EZ                             4    1.170-13T, discussed in General                    A. Who Must File
G Accounting Period Covered                 4    Instruction R, provide guidance on payroll         Section 501(a), (e), (f), and (k)
H   When and Where To File                  5    contributions and goods and services of            organizations
I   Extension of Time To File               5    insubstantial value.
J   Amended Return/Final Return             5    ● The instructions for the lobbying rules of       Except for those types of organizations
K   Penalties                               5    the Revenue Reconciliation Act of 1993             listed in General Instruction C, an annual
                                                 were amended in General Instruction R              return on Form 990 (or Form 990-EZ) is
L   Public Inspection of Completed Exempt
    Organization Returns and Approved            and the instructions for line 35.                  required from every organization exempt
    Exemption Applications                  5                                                       from tax under section 501(a). This
                                                 ● The schedule of contributors, required           includes foreign organizations and
M Disclosures Regarding Certain                  for line 1, must show the date of a
    Information and Services Furnished      6                                                       cooperative service organizations
                                                 noncash contribution. No date is required          described in sections 501(e) and (f), and
N   Disclosures Regarding Certain
    Transactions and Relationships          6    for a cash contribution.                           child care organizations described in
O Erroneous Backup Withholding              6    ● Except for special event sales, all sales        section 501(k).
P   Group Return                            6    of inventory and related cost of goods sold
                                                 are now reported on lines 7a and 7b.               Gross receipts and total assets
Q Organizations in Foreign Countries
    and U.S. Possessions                    6    ● Any grants reported on line 10 that were
R   Substantiation, Disclosure, and              approved during the year but not paid by           Organizations whose annual gross receipts
    Lobbying Provisions of the Revenue           the due date for filing Form 990-EZ must           are normally more than $25,000 must file
    Reconciliation Act of 1993              6    be listed separately in the schedule of            Form 990 (or Form 990-EZ). An
●   Specific Instructions                   7    grants required by line 10.                        organization may file Form 990-EZ instead
●   Part I—Statement of Revenue,                                                                    of Form 990 if it meets BOTH of the
    Expenses, and Changes in Net Assets,         ● Each filer must indicate its primary
                                                 exempt purpose in Part III, Statement of           following requirements: Its gross receipts
    or Fund Balances                        8                                                       during the year were less than $100,000
●   Part II—Balance Sheets                 13    Program Service Accomplishments. Filers
                                                 must also describe the activities they             AND its total assets (line 25, column (B) of
●   Part III—Statement of Program Service                                                           Form 990-EZ) at the end of the year were
    Accomplishments                        13    conducted to further their exempt
                                                 purposes and state what these activities           less than $250,000. If the organization fails
●   Part IV—List of Officers, Directors,                                                            to meet either of these conditions, it may
    Trustees, and Key Employees            14    accomplished.
                                                                                                    not file Form 990-EZ. Instead, the
●   Part V—Other Information               14    ● The preferred address for contacting             organization must file Form 990. See the
                                                 officers, etc., is requested for Part IV. A

                                                                 Cat. No. 64888C
gross receipts discussion in General            B. Exempt Organization                                         5. A state institution whose income is
Instruction C.                                                                                              excluded from gross income under section
Note: The Office of Personnel Management
                                                Reference Chart                                             115.
(OPM) requests a completed Form 990,            Type of Organization                       I.R.C. section      6. An organization described in section
and will not accept a Form 990-EZ, from         Corporations Organized Under Act of                         501(c)(1). Section 501(c)(1) organizations
any organization applying to participate in a      Congress                                    501(c)(1)    are corporations organized under an Act of
Combined Federal Campaign.                      Title Holding Corporations                     501(c)(2)    Congress that are:
                                                Charitable, Religious, Educational,
Section 4947(a)(1) nonexempt charitable            Scientific, etc., Organizations             501(c)(3)    ● Instrumentalities of the United States,
trusts                                          Civic Leagues and Social Welfare                            and
                                                   Organizations                               501(c)(4)
                                                                                                            ● Exempt from Federal income taxes.
Any nonexempt charitable trust (described       Labor, Agricultural, and Horticultural
in section 4947(a)(1)) not treated as a            Organizations                               501(c)(5)       7. A private foundation exempt under
private foundation is also required to file     Business Leagues, etc.                         501(c)(6)    section 501(c)(3) and described in section
Form 990 (or Form 990-EZ) if its gross          Social and Recreation Clubs                    501(c)(7)    509(a). (Required to file Form 990-PF,
receipts are normally more than $25,000.        Fraternal Beneficiary and Domestic                          Return of Private Foundation.)
                                                   Fraternal Societies and
See General Instruction A for Form 990-EZ          Associations                         501(c)(8) & (10)       8. A black lung benefit trust described in
gross receipts and total assets                 Voluntary Employees’ Beneficiary                            section 501(c)(21). (Required to file Form
requirements. See General Instruction D for        Associations                                501(c)(9)    990-BL, Information and Initial Excise Tax
exceptions to filing Form 1041, U.S.            Teachers’ Retirement Fund Associations 501(c)(11)           Return for Black Lung Benefit Trusts and
Income Tax Return for Estates and Trusts.       Benevolent Life Insurance Associations,                     Certain Related Persons.)
                                                   Mutual Ditch or Irrigation Companies,
If an organization’s exemption                     Mutual or Cooperative Telephone                             9. A stock bonus, pension, or
application is pending                             Companies, etc.                            501(c)(12)    profit-sharing trust that qualifies under
                                                Cemetery Companies                            501(c)(13)    section 401. (See Form 5500, Annual
If the organization’s application for           State Chartered Credit Unions, Mutual                       Return/Report of Employee Benefit Plan.)
exemption is pending, check the box in             Reserve Funds                              501(c)(14)
                                                                                                               10. A religious or apostolic organization
item F in the heading of the return and         Mutual Insurance Companies or
                                                                                                            described in section 501(d). (Required to
complete the return.                               Associations                               501(c)(15)
                                                Cooperative Organizations To Finance                        file Form 1065, U.S. Partnership Return of
If the organization received a Form 990            Crop Operations                            501(c)(16)    Income.)
Package                                         Supplemental Unemployment Benefit                              11. A foreign organization whose annual
                                                   Trusts                                     501(c)(17)
                                                                                                            gross receipts from sources within the U.S.
If the organization received a Form 990         Employee Funded Pension Trusts (created
                                                   before 6/25/59)                            501(c)(18)    are normally $25,000 or less (Rev. Proc.
Package with a preaddressed label, we
                                                Organizations of Past or Present                            94-17, 1994-1 C.B. 579). See the
ask that the organization file anyway even
                                                   Members of the                                           discussion on the $25,000 gross receipts
if it is not required to do so. Attach the         Armed Forces                        501(c)(19) & (23)    test in General Instruction C. See also
label to the name and address space on          Black Lung Benefit Trusts                     501(c)(21)    General Instruction A if the organization
the return (see Specific Instructions).         Withdrawal Liability Payment Funds            501(c)(22)    received a Form 990 Package.
Check the box in item J in the heading of       Title Holding Corporations
the Form 990-EZ to indicate that the               or Trusts                                  501(c)(25)       12. An organization whose annual gross
organization’s gross receipts are normally      Religious and Apostolic Associations              501(d)    receipts are normally $25,000 or less is not
not more than $25,000; sign the return;         Cooperative Hospital Service Organizations        501(e)    required to file; however, see General
and send it to the service center for the       Cooperative Service Organizations of                        Instruction A if the organization received a
organization’s area. The organization does         Operating Educational Organizations             501(f)   Form 990 Package.
not have to complete Parts I through V of       Child Care Organizations                          501(k)       a. Calculating gross receipts.—The
the return. Following this instruction will                                                                 organization’s gross receipts are the total
help us to update our records, and we will      C. Organizations Not                                        amount it received from all sources during
not have to contact the organization later                                                                  its annual accounting period, without
to ask why no return was filed. If the          Required To File                                            subtracting any costs or expenses. Gross
organization files a return this way, it will   Note: Organizations not required to file this               receipts are the sum of lines 1, 2, 3, 4, 5a,
not be mailed a Form 990 Package in later       form with the IRS may wish to use it to                     6a, 7a, and 8 of Part I. Gross receipts can
years and need not file Form 990 (or Form       satisfy state reporting requirements. For                   also be calculated by adding back the
990-EZ) again until its gross receipts          details, see General Instruction E.                         amounts on lines 5b, 6b, and 7b to the
normally exceed the $25,000 minimum or it                                                                   total revenue reported on line 9.
terminates or undergoes a substantial              The following types of organizations
                                                exempt from tax under section 501(a) do                     Example. On line 9 of its Form 990-EZ for
contraction as described in the instructions
                                                not have to file Form 990 (or Form 990-EZ)                  1994, Organization M reported $50,000 as
for line 36.
                                                with the IRS:                                               total revenue. M added back the costs and
Failure to file and its effect on                  1. A church, an interchurch organization                 expenses it had deducted on lines 5b
contributions                                   of local units of a church, a convention or                 ($2,000); 6b ($1,500); and 7b ($500) to its
                                                association of churches, an integrated                      total revenue of $50,000 and determined
Organizations that are eligible to receive                                                                  that its gross receipts for the tax year were
tax-deductible contributions are listed in      auxiliary of a church (such as a men’s or
                                                women’s organization, religious school,                     $54,000.
Publication 78, Cumulative List of
Organizations described in Section 170(c)       mission society, or youth group), or an                        b. Gross receipts when acting as
of the Internal Revenue Code of 1986. An        internally supported, church-controlled                     agent.—If a local chapter of a section
organization may be removed from this           organization described in Rev. Proc. 86-23,                 501(c)(8) fraternal organization collects
listing if our records show that it is          1986-1 C.B. 564.                                            insurance premiums for its parent lodge
required to file Form 990 (or Form 990-EZ),        2. A school below college level affiliated               and merely sends those premiums to the
but it does not file a return or advise us      with a church or operated by a religious                    parent without asserting any right to use
that it is no longer required to file.          order.                                                      the funds or otherwise deriving any benefit
However, contributions to such an                                                                           from collecting them, the local chapter
                                                   3. A mission society sponsored by, or                    should not include the premiums in its
organization may continue to be deductible      affiliated with, one or more churches or
by the general public until the IRS                                                                         gross receipts. The parent lodge should
                                                church denominations, if more than half of                  report them instead. The same treatment
publishes a notice to the contrary in the       the society’s activities are conducted in, or
Internal Revenue Bulletin.                                                                                  applies in other situations in which one
                                                directed at persons in, foreign countries.                  organization collects funds merely as an
                                                   4. An exclusively religious activity of any              agent for another.
                                                religious order.                                               c. $25,000 gross receipts test.—An
                                                                                                            organization’s gross receipts are

Page 2
considered normally to be $25,000 or less       990-EZ and do not file Form 1041. A               or otherwise disposes of the property
if the organization is:                         section 4947(a)(1) nonexempt charitable           within 2 years after receiving the property.
   1. Up to a year old and has received, or     trust that normally has gross receipts of            Also, the form is required of any
donors have pledged to give, $37,500 or         not more than $25,000 (see the gross              successor donee who disposes of
less during its first tax year;                 receipts discussion in General Instruction        charitable deduction property within 2
                                                C) and has no taxable income under                years after the date that the donor gave
   2. Between 1 and 3 years old and             Subtitle A must complete only the
averaged $30,000 or less in gross receipts                                                        the property to the original donee. It does
                                                following items in the heading of Form            not matter who gave the property to the
during each of its first 2 tax years; or        990-EZ:                                           successor donee. It may have been the
   3. Three years old or more and averaged      Item                                              original donee or another successor donee.
$25,000 or less in gross receipts for the
immediately preceding 3 tax years                  A. Tax year (fiscal year or short period, if   Form 8300.—Report of Cash Payments
(including the year for which the return        applicable);                                      Over $10,000 Received in a Trade or
would be filed).                                   B. Applicable checkboxes;                      Business. Used to report cash amounts in
                                                                                                  excess of $10,000 that were received in a
                                                   C. Name and address;                           single transaction (or in two or more
D. Forms and Publications                          D. Employer identification number; and         related transactions) in the course of a
To File or Use                                     I. Section 4947(a)(1) nonexempt                trade or business (as defined in section
                                                charitable trust box. (Also, complete line 42     162). However, if the organization receives
Schedule A (Form 990).— Organization                                                              a charitable cash contribution in excess of
Exempt Under Section 501(c)(3) (Except          and the signature block on page 2 of the
                                                return.)                                          $10,000, it is not subject to the reporting
Private Foundation), 501(e), 501(f), 501(k),                                                      requirement since the funds were not
or Section 4947(a)(1) Nonexempt                 Form 1096.—Annual Summary and                     received in the course of a trade or
Charitable Trust. Filed with Form 990-EZ        Transmittal of U.S. Information Returns.          business.
for a section 501(c)(3) organization that is    Form 1099 Series.—Information returns
not a private foundation (and including an                                                        Form 8822.—Change of Address. Used to
                                                for reporting payments such as dividends,         notify the IRS of a change in mailing
organization described in section 501(e),       interest, miscellaneous income (including
501(f), or 501(k)). Also filed with Form                                                          address that occurs after the return is filed.
                                                medical and health care payments and
990-EZ for a section 4947(a)(1) nonexempt       nonemployee compensation), original issue         Publication 525.—Taxable and Nontaxable
charitable trust that is not treated as a       discount, patronage dividends, real estate        Income.
private foundation. An organization is not      transactions, acquisition or abandonment          Publication 598.—Tax on Unrelated
required to file Schedule A (Form 990) if its   of secured property, discharge of                 Business Income of Exempt Organizations.
gross receipts are normally $25,000 or          indebtedness, and distributions from
less. See the gross receipts discussion in                                                        Publication 910.—Guide to Free Tax
                                                annuities, pensions, profit-sharing plans,        Services.
General Instruction C.                          and retirement plans.
Forms W-2 and W-3.—Wage and Tax                                                                   Publication 1391.—Deductibility of
                                                Form 1120-POL.—U.S. Income Tax Return             Payments Made to Charities Conducting
Statement, and Transmittal of Income and        for Certain Political Organizations.
Tax Statements.                                                                                   Fund-Raising Events.
                                                Form 1128.—Application To Adopt,                  Publication 1771.—Charitable
Form 940.—Employer’s Annual Federal             Change, or Retain a Tax Year.
Unemployment (FUTA) Tax Return.                                                                   Contributions Substantiation and
                                                Form 2758.—Application for Extension of           Disclosure Requirements.
Form 941.—Employer’s Quarterly Federal          Time To File Certain Excise, Income,
Tax Return. Used to report social security,                                                          These forms and publications are
                                                Information, and Other Returns.                   available free at many IRS offices or by
Medicare, and income taxes withheld by
an employer and social security and             Form 4506-A.—Request for Public                   calling 1-800-TAX-FORM
Medicare taxes paid by an employer.             Inspection or Copy of Exempt Organization         (1-800-829-3676).
                                                Tax Form.
   If income, social security, and Medicare
taxes that must be withheld are not             Form 4720.—Return of Certain Excise               E. Use of Form 990-EZ To
                                                Taxes on Charities and Other Persons
withheld or are not paid to the IRS, a Trust
                                                Under Chapters 41 and 42 of the Internal          Satisfy State Reporting
Fund Recovery Penalty may apply. The
penalty is 100% of such unpaid taxes.           Revenue Code. Section 501(c)(3)                   Requirements
                                                organizations that file Form 990 (or Form
   This penalty may be imposed on all                                                             Some states and local government units
                                                990-EZ), as well as the managers of these
persons (including volunteers) whom the                                                           will accept a copy of Form 990-EZ and
                                                organizations, use this form to report their
IRS determines to be responsible for                                                              Schedule A (Form 990) in place of all or
                                                tax on political expenditures and certain
collecting, accounting for, and paying over                                                       part of their own financial report forms.
                                                lobbying expenditures.
these taxes, and who willfully did not do                                                         The substitution applies primarily to section
so.                                             Form 5500 or 5500-C/R.—Employers who              501(c)(3) organizations, but some of the
                                                maintain pension, profit-sharing, or other        other types of section 501(c) organizations
Form 990-T.—Exempt Organization                 funded deferred compensation plans are            are also affected.
Business Income Tax Return. Filed               generally required to file one of the 5500
separately for organizations with gross                                                             If the organization uses Form 990-EZ to
                                                series forms specified below. This
income of $1,000 or more from business                                                            satisfy state or local filing requirements,
                                                requirement applies whether or not the
unrelated to the organization’s exempt                                                            such as those under state charitable
                                                plan is qualified under the Internal Revenue
purpose; also filed to pay the section                                                            solicitation acts, note the following:
                                                Code and whether or not a deduction is
6033(e)(2) proxy tax (see line 35 and its       claimed for the current tax year.
instructions).                                                                                    Determine state filing requirements
                                                   Plans with 100 or more participants must       The organization should consult the
Form 990-W.—Estimated Tax on                    file Form 5500, Annual Return/Report of
Unrelated Business Taxable Income for                                                             appropriate officials of all states and other
                                                Employee Benefit Plan.                            jurisdictions in which the organization does
Tax-Exempt Organizations.
                                                   Plans with fewer than 100 participants         business to determine their specific filing
Form 1041.—U.S. Income Tax Return for           must file Form 5500-C/R, Return/Report of         requirements. “Doing business” in a
Estates and Trusts. Required of section         Employee Benefit Plan.                            jurisdiction may include any of the
4947(a)(1) nonexempt charitable trusts that                                                       following: (a) soliciting contributions or
also file Form 990 (or Form 990-EZ).            Form 5768.—Election/Revocation of
                                                Election by an Eligible Section 501(c)(3)         grants by mail or otherwise from
However, if such a trust does not have any                                                        individuals, businesses, or other charitable
taxable income under Subtitle A of the          Organization To Make Expenditures To
                                                Influence Legislation.                            organizations; (b) conducting programs;
Code, it can file Form 990 (or Form                                                               (c) having employees within that
990-EZ) and need not file Form 1041 to          Form 8282.—Donee Information Return.              jurisdiction; (d) maintaining a checking
meet its section 6012 filing requirement. If    Required of the donee of “charitable              account; or (e) owning or renting property
this condition is met, complete Form            deduction property” who sells, exchanges,         there.
                                                                                                                                       Page 3
Monetary tests may differ                        Amended returns                                      2. The Form 990-EZ filer and Form 5500
                                                                                                   filer are identical for financial reporting
Some or all of the dollar limitations            If the organization submits supplemental
                                                                                                   purposes and have identical receipts,
applicable to Form 990-EZ when filed with        information or files an amended Form
                                                                                                   disbursements, assets, liabilities, and
the IRS may not apply when using Form            990-EZ with the IRS, it must also furnish a
                                                                                                   equity accounts;
990-EZ in place of state or local report         copy of the information or amended return
forms. Examples of the IRS dollar                to any state with which the organization             3. The employee benefit plan does not
limitations that do not meet some state          filed a copy of Form 990-EZ originally to         include more than one section 501(c)
requirements are the $25,000 gross               meet that state’s filing requirement.             organization, and the section 501(c)
receipts minimum that creates an                                                                   organization is not a part of more than one
                                                    If a state requires the organization to file
obligation to file with the IRS (see the                                                           employee benefit plan; and
                                                 an amended Form 990-EZ to correct
gross receipts discussion in General             conflicts with Form 990-EZ instructions,             4. The organization’s accounting year
Instruction C), and the $50,000 minimum          the organization must also file an amended        and the employee plan year are the same.
for listing professional fees in Part II of      return with the IRS.                              If they are not, you may want to change
Schedule A (Form 990).                                                                             the organization’s accounting year, as
                                                 Method of accounting                              explained in General Instruction G, so it
Additional information may be required                                                             will coincide with the plan year.
                                                 Most states require that all amounts be
State or local filing requirements may           reported based on the accrual method of
require the organization to attach to Form                                                         Allowable substitution areas
                                                 accounting. See also Specific Instructions,
990-EZ one or more of the following:             item G.                                           Whether the organization files Form
(a) additional financial statements, such as                                                       990-EZ for a labor organization or for an
a complete analysis of functional expenses       Time for filing may differ                        employee benefit plan, the areas of Form
or a statement of changes in financial                                                             990-EZ for which other forms can be
position; (b) notes to financial statements;     The time for filing Form 990-EZ with the
                                                 IRS differs from the time for filing reports      substituted are the same. These areas are:
(c) additional financial schedules; (d) a
                                                 with some states.                                 ● Part I, lines 10 through 16 (but complete
report on the financial statements by an
                                                                                                   lines 17 through 21).
independent accountant; and (e) answers          Public inspection
to additional questions and other                                                                  ● Part II (but complete lines 25 through 27,
information. Each jurisdiction may require       The Form 990-EZ information made                  columns (A) and (B)).
the additional material to be presented on       available for public inspection by the IRS           If the organization substitutes Form
forms they provide. The additional               may differ from that made available by the        LM-2 or LM-3 for any of the Form 990-EZ
information does not have to be submitted        states. See the Caution for line 1,               parts or line items mentioned above, it
with the Form 990-EZ filed with the IRS.         instruction D.                                    must attach a reconciliation sheet to show
   Even if the Form 990-EZ the organization                                                        the relationship between the amounts on
                                                 State registration number
files with the IRS is accepted by the IRS                                                          the DOL forms and the amounts on Form
as complete, a copy of the same return           Enter the applicable state or local               990-EZ. This is particularly true of the
filed with a state will not fully satisfy that   jurisdiction registration or identification       relationship of disbursements shown on
state’s filing requirement if required           number in item E (in the heading of the           the DOL forms and the total expenses on
information is not provided, including any       return) for each jurisdiction in which the        line 17, Part I, of Form 990-EZ. The
of the additional information discussed          organization files Form 990-EZ in place of        organization must make this reconciliation
above, or if the state determines that the       the state or local form. If filing in several     because the cash disbursements section
form was not completed by following the          jurisdictions, prepare as many copies as          of the DOL forms includes nonexpense
applicable Form 990-EZ instructions or           needed with item E blank. Then enter the          items. If the organization substitutes Form
supplemental state instructions. If so, the      applicable registration number on the copy        LM-2, be sure to complete a separate
organization may be asked to provide the         to be filed with each jurisdiction.               schedule of expenses.
missing information or to submit an
amended return.                                  F. Other Forms as Partial                         G. Accounting Period
Use of audit guides may be required              Substitutes for Form 990-EZ                       Covered
To ensure that all organizations report          Except as provided below, the IRS will not        Use the 1994 Form 990-EZ to report on
similar transactions uniformly, many states      accept any form as a substitute for one or        the 1994 calendar year accounting period.
require that contributions, gifts, grants,       more parts of Form 990-EZ.                        A calendar year accounting period begins
etc., on line 1 in Part I and program                                                              on January 1 and ends on December 31.
service expenses in Part III be reported         Labor organizations (section 501(c)(5))
                                                                                                      If the organization has established a
according to the AICPA industry audit            A labor organization that files Form LM-2,        fiscal year accounting period, use the 1994
guide, Audits of Voluntary Health and            Labor Organization Annual Report, or the          Form 990-EZ to report on the
Welfare Organizations (New York, NY,             shorter Form LM-3, Labor Organization             organization’s fiscal year that began in
AICPA, 1988), as supplemented by                 Annual Report, with the U.S. Department           1994 and ended 12 months later. A fiscal
Standards of Accounting and Financial            of Labor (DOL) can attach a copy of the           year accounting period should normally
Reporting for Voluntary Health and Welfare       completed DOL form to provide some of             coincide with the natural operating cycle of
Organizations (Washington, DC, National          the information required by Form 990-EZ.          the organization. Be certain to indicate in
Health Council, Inc., 1988 3rd edition), and     This substitution is not permitted if the         item A (in the heading of Form 990-EZ) the
by Accounting and Financial Reporting—A          organization files a DOL report that              date the organization’s fiscal year began in
Guide for United Ways and Not-for-Profit         consolidates its financial statements with        1994 and the date the fiscal year ended in
Human Service Organizations (Alexandria,         those of one or more separate subsidiary          1995.
VA, United Way Institute, 1989).                 organizations.                                       Use the 1994 Form 990-EZ to report on
Donated services and facilities                  Employee benefit plans (section                   a short accounting period (less than 12
                                                 501(c)(9), (17), or (18))                         months) that began in 1994 and ended
Even though reporting donated services                                                             November 30, 1995, or earlier.
and facilities as items of revenue and           An employee benefit plan may be able to
expense is called for in certain                                                                      In general, for the organization to change
                                                 substitute Form 5500, or Form 5500-C/R,           its accounting period, it must timely file a
circumstances by the three publications          for part of Form 990-EZ. The substitution
named above, many states and the IRS do                                                            return on Form 990-EZ for the short period
                                                 can be made if the organization filing Form       resulting from the change. At the top of the
not permit the inclusion of those amounts        990-EZ and the plan filing Form 5500 or
in Part I of Form 990-EZ. The instructions                                                         short period return, write “Change of
                                                 5500-C/R meet all the following tests:            Accounting Period.” If the organization
in Part III discuss the optional reporting of
donated services and facilities.                   1. The Form 990-EZ filer is organized           changed its accounting period within the
                                                 under section 501(c)(9), (17), or (18);           10-calendar-year period that includes the
                                                                                                   beginning of the short period, and it had a
Page 4
Form 990-EZ (or Form 990) filing                         write “Amended Return” at the top of the         L. Public Inspection of
requirement at any time during that                      return.
10-year period, it must also attach a Form                  The organization may file an amended
                                                                                                          Completed Exempt
1128 to the short-period return. See Rev.                return at any time to change or add to the       Organization Returns and
Proc. 85-58, 1985-2 C.B. 740.                            information reported on a previously filed       Approved Exemption
                                                         return for the same period. The
H. When and Where To File                                organization must make the amended               Applications
                                                         return available for public inspection for 3
File Form 990-EZ by the 15th day of the                  years from the date of filing or 3 years         Through the IRS
5th month after the organization’s                       from the date the original return was due,       Forms 990, 990-EZ, and certain other
accounting period ends. If the regular due               whichever is later.                              completed exempt organization returns are
date falls on a Saturday, Sunday, or legal
                                                            The organization must also send a copy        available for public inspection and copying
holiday, file on the next business day. A
                                                         of the information or amended return to          upon request. Approved applications for
business day is any day that is not a
                                                         any state with which it filed a copy of Form     exemption from Federal income tax are
Saturday, Sunday, or legal holiday.
                                                         990-EZ originally to meet that state’s filing    also available. However, the IRS may not
   If the organization is liquidated,                    requirement.                                     disclose portions of an application relating
dissolved, or terminated, file the return by                                                              to any trade secrets, etc., nor can the IRS
the 15th day of the 5th month after the                     Use Form 4506-A to obtain a copy of a         disclose the schedule of contributors
liquidation, dissolution, or termination.                previously filed return. You can obtain          required as an attachment for line 1 of
                                                         blank forms for prior years by calling           Forms 990 and 990-EZ (section 6104).
   If the return is not filed by the due date            1-800-TAX-FORM (1-800-829-3676).
(including any extension granted), attach a                                                                  A request for inspection must be in
statement giving the reasons for not filing                 If the return is a final return, see the      writing and must include the name and
on time.                                                 specific instructions for line 36, Part V,       address (city and state) of the organization
                                                         Other Information.                               that filed the return or application. A
                                Send the return to
  If the principal office is                                                                              request to inspect a return should indicate
                               the Internal Revenue
        is located in
                               Service Center below      K. Penalties                                     the type (number) of the return and the
                                                                                                          year(s) involved. The request should be
Alabama, Arkansas, Florida,                              Against the organization                         sent to the District Director (Attention:
Georgia, Louisiana,                Atlanta, GA 39901                                                      Disclosure Officer) of the district in which
Mississippi, North Carolina,                             Under section 6652(c), a penalty of $10 a
South Carolina, Tennessee                                day, not to exceed the smaller of $5,000 or      the requester desires to inspect the return
                                                         5% of the gross receipts of the                  or application. If inspection at the IRS
Arizona, Colorado, Kansas,                                                                                National Office is desired, the request
New Mexico, Oklahoma,                Austin, TX 73301    organization for the year, may be charged
Texas, Utah, Wyoming                                     when a return is filed late, unless the          should be sent to the Commissioner of
                                                         organization can show that the late filing       Internal Revenue, Attention: Freedom of
Indiana, Kentucky,
Michigan, Ohio, West             Cincinnati, OH 45999    was due to reasonable cause. The penalty         Information Reading Room, 1111
Virginia                                                 begins on the due date for filing the Form       Constitution Avenue, NW, Washington, DC
                                                         990-EZ. The penalty may also be charged          20224.
Alaska, California, Hawaii,
Idaho, Nevada, Oregon,              Fresno, CA 93888     if the organization files an incomplete             Form 4506-A can be used to request a
Washington                                               return or furnishes incorrect information. To    copy or to inspect an exempt organization
Connecticut, Maine,                                      avoid having to supply missing information       return. There is a fee for photocopying.
Massachusetts, New                Holtsville, NY 00501   later, be sure to complete all applicable
Hampshire, New York,                                                                                      Through the organization
Rhode Island, Vermont                                    line items; answer “Yes,” “No,” or “N/A”
                                                         (not applicable) to each question on the
Illinois, Iowa, Minnesota,                               return; make an entry (including a zero          Annual return
Missouri, Montana,
Nebraska, North Dakota,
                               Kansas City, MO 64999     when appropriate) on all total lines; and        An organization must, during the 3-year
South Dakota, Wisconsin                                  enter “None” or “N/A” if an entire part          period beginning with the due date
Delaware, District of
                                                         does not apply.                                  (including extensions, if any), of the Form
Columbia, Maryland, New                                                                                   990 (or Form 990-EZ), make its return
Jersey, Pennsylvania,          Philadelphia, PA 19255
                                                         Against responsible person(s)                    available for public inspection upon
Virginia, any U.S.                                                                                        request. All parts of the return and all
possession, or foreign                                   If the organization does not file a complete
country                                                  return or does not furnish correct               required schedules and attachments, other
                                                         information, the IRS will send the               than the schedule of contributors to the
                                                         organization a letter with a fixed time to       organization, must be made available.
I. Extension of Time To File                             fulfill these requirements. After that period    Inspection must be permitted during
                                                         expires, the person failing to comply will be    regular business hours at the
Use Form 2758 to request an extension of
                                                         charged a penalty of $10 a day, not to           organization’s principal office and at each
time to file a Form 990-EZ (or Form 990).
                                                         exceed $5,000, unless he or she shows            of its regional or district offices having
Generally, the IRS will not grant an
                                                         that not complying was due to reasonable         three or more employees. This provision
extension of time for more than 90 days
                                                         cause. If more than one person is                applies to any organization that files Form
unless sufficient need for an extended
                                                         responsible, they are jointly and individually   990 (or Form 990-EZ), regardless of the
period is clearly shown. In no event will an
                                                         liable for the penalty.                          size of the organization and whether or not
extension of more than 6 months be
                                                                                                          it has any paid employees.
granted to any domestic organization.                        There are also penalties—fines and
                                                         imprisonment—for willfully not filing returns       If the organization does not maintain a
                                                         and for filing fraudulent returns and            permanent office, it must provide a
J. Amended Return/Final                                  statements with the IRS (sections 7203,          reasonable location for a requester to
Return                                                   7206, and 7207). There are also penalties        inspect the organization’s annual returns.
                                                         for failure to comply with public disclosure     The organization may mail the information
To change the organization’s return for any                                                               to a requester. However, the organization
year, file a new return including any                    requirements as discussed in General
                                                         Instruction L. States may impose additional      can charge for copying and postage only if
required attachments. Use the revision of                                                                 the requester gives up the right to a free
Form 990-EZ applicable to the year being                 penalties for failure to meet their separate
                                                         filing requirements.                             inspection (Notice 88-120, 1988-2 C.B.
amended. The amended return must                                                                          454).
provide all the information called for by the
form and instructions, not just the new or                                                                   If an organization furnishes additional
corrected information. Check the                                                                          information to the IRS to be made part of
“Amended Return” box, in the heading of                                                                   its return, as a result of an examination or
the return, or, if the version of the form                                                                correspondence from the service center
being used does not have such a box,                                                                      processing the return, it must also make
                                                                                                                                             Page 5
that information part of the return it          N. Disclosures Regarding                         R. Substantiation,
provides for public inspection.
  Any person who does not comply with
                                                Certain Transactions and                         Disclosure, and Lobbying
the public inspection requirement shall be      Relationships                                    Provisions of the Revenue
assessed a penalty of $10 for each day          In their annual returns on Schedule A            Reconciliation Act of 1993
that inspection was not permitted, up to a      (Form 990), section 501(c)(3) organizations
maximum of $5,000 for each return. No                                                            The following provisions were enacted by
                                                must disclose information regarding their        the Revenue Reconciliation Act of 1993
penalty will be imposed if the failure is due   direct or indirect transfers to, and other
to reasonable cause. Any person who                                                              and are effective on or after January 1,
                                                direct or indirect relationships with, other     1994.
willfully fails to comply shall be subject to   section 501(c) organizations (except other
an additional penalty of $1,000 (sections       section 501(c)(3) organizations) or section      1. Substantiation requirements for
6652(c) and 6685).                              527 political organizations. This provision      certain contributions.—A donor that
                                                helps to prevent the diversion or                makes a charitable contribution of $250 or
Exemption application                                                                            more will not be allowed a Federal income
                                                expenditure of a section 501(c)(3)
Any section 501(c) organization that            organization’s funds for purposes not            tax deduction under section 170 unless the
submitted an application for recognition of     intended by section 501(c)(3). All section       donor obtains, contemporaneously with
exemption to the Internal Revenue Service       501(c)(3) organizations must maintain            giving the charitable contribution, a written
after July 15, 1987, must make available        records regarding all such transfers,            acknowledgment (receipt) from the donee
for public inspection a copy of its             transactions, and relationships. See the         organization (section 170(f)(8)). Taxpayers
application (together with a copy of any        discussion of penalties in General               (donors) may not rely solely on a cancelled
papers submitted in support of its              Instruction K.                                   check as substantiation for a donation of
application) and any letter or other                                                             $250 or more to a donee organization.
document issued by the Internal Revenue                                                             An acknowledgment is considered to be
Service in response to the application. An
                                                O. Erroneous Backup                              “contemporaneous” with a donor’s
organization that submitted its exemption       Withholding                                      contribution if it is obtained by the earlier
application on or before July 15, 1987,         Recipients of dividend or interest payments      of the date on which the donor files a tax
must also comply with this requirement if it    generally must certify their correct taxpayer    return for the tax year in which the
had a copy of its application on July 15,       identification number to the bank or other       contribution was made or the due date,
1987. For annual returns, the copy of the       payer on Form W-9, Request for Taxpayer          including extensions, for filing that return.
application and related documents must          Identification Number and Certification. If         The acknowledgment the donee gives to
be made available for inspection during         the payer does not get this information, it      the donor does not have to be in any
regular business hours at the                   must withhold part of the payments as            particular form but it must show (a) the
organization’s principal office and at each     “backup withholding.” If the organization        amount of cash contributed and (b) a
of its regional or district offices having at   was subject to erroneous backup                  description (but not value) of any property
least three employees.                          withholding because the payer did not            contributed, other than cash. Further, the
   If the organization does not have a          realize it was an exempt organization and        acknowledgment must (c) describe and
permanent office, it must provide a             not subject to this withholding, it can claim    show the value, estimated in good faith by
reasonable location for the inspection of       credit for the amount withheld. See the          the donee, of any goods or services the
both its annual returns and exemption           Instructions for Form 990-T if the               donee gave in return for the contribution. A
application. The information may be             organization had backup withholding              false substantiation acknowledgment may
mailed. See the reference to Notice 88-120      erroneously withheld. Claims for refund          subject the donee organization to section
under Annual return. The organization           must be filed within 3 years after the date      6701 penalties for aiding and abetting an
need not disclose any portion of an             the original return was due; 3 years after       understatement of tax liability. If the donor
application relating to trade secrets, etc.,    the date the organization filed it; or 2 years   did not receive any goods or services from
that would not also be disclosable by the       after the date the tax was paid, whichever       the donee organization in return for its
IRS.                                            is later.                                        contribution, the donee’s written
   The penalties for failure to comply with                                                      acknowledgment must state that fact.
this provision are the same as those under      P. Group Return                                     If the donor received only goods and
Annual return above, except that the                                                             services of insubstantial value in return for
$5,000 limitation does not apply.               If a parent organization wants to file a         its contribution, a written acknowledgment
                                                group return for two or more of its              is not required. See Revenue Procedures
                                                subsidiaries, it must use Form 990. The
M. Disclosures Regarding                        parent organization cannot use Form
                                                                                                 90-12, 1990-1 C.B. 471, and 93-49,
                                                                                                 1993-2 C.B. 581 (and any successor
Certain Information and                         990-EZ. See the Instructions for Form 990        documents), and line 1 instructions for a
                                                for filing a group return.
Services Furnished                                                                               discussion of benefits of nominal value.
                                                   An affiliated organization covered by a          If the donee organization provided goods
A section 501(c) organization that offers to    group ruling may file a separate return
sell or solicits money for specific                                                              or services consisting solely of intangible
                                                instead of being included in the group           religious benefits, the donee must make a
information or a routine service for any        return.
individual that could be obtained by such                                                        statement to that effect instead of
individual from a Federal government                                                             providing an estimated valuation.
agency free or for a nominal charge must        Q. Organizations in Foreign                         An “intangible religious benefit” must be
disclose that fact when making such offer       Countries and U.S.                               (a) provided by an organization organized
or solicitation. Any organization that                                                           exclusively for religious purposes and
intentionally disregards this requirement       Possessions                                      (b) not generally sold in a commercial
will be subject to a penalty for each day       Refer to General Instruction C for filing        transaction.
on which the offers or solicitations are        exemption for foreign organizations with            The donee organization may either
made. The penalty imposed for a particular      $25,000 or less in gross receipts from U.S.      provide separate statements for each
day is the greater of $1,000 or 50% of the      sources.                                         contribution of $250 or more from a donor,
total cost of the offers and solicitations         Report amounts in U.S. dollars and state      or furnish periodic statements
made on that day.                               what conversion rate you use. Combine            substantiating contributions of $250 or
                                                amounts from within and outside the              more.
                                                United States and report the total for each         Separate payments are regarded as
                                                item. All information must be written in         independent contributions and are not
                                                English.                                         aggregated for purposes of measuring the
                                                                                                 $250 threshold. If donations are made
                                                                                                 through payroll deductions, the deduction

Page 6
from each paycheck is regarded as a              these dues, etc., these organizations            dues remain eligible for deduction to the
separate payment.                                generally must give their members a              extent otherwise deductible. See sections
   An organization described in section          written estimate showing the allocation of       162(e) and 6033(e).
170(c), or an organization that is a Principal   membership dues, etc., to the                       As stated above, section 501(c)(3)
Combined Fund Organization for purposes          organization’s lobbying and political            organizations are not subject to the
of the Combined Federal Campaign and             expenses.                                        lobbying and political expense disclosure
acting in that capacity, that receives a            The term “dues” means the amount the          requirements. However, a contributor to a
payment made as a contribution is treated        organization requires a member to pay in         charity that engages in lobbying and
as the donee organization for purposes of        order to be recognized by the organization       political activities cannot take a section
section 170(f)(8), even if the organization      as a member. Payments that are similar to        170 or 162 deduction for a contribution if
distributes the amount received to one or        dues include members’ voluntary                  (a) the charity’s lobbying and political
more organizations described in section          payments, assessments made by the                activities are on matters of direct financial
170(c).                                          organization to cover basic operating            interest to the contributor’s trade or
   See also Publication 1771 and                 costs, and special assessments imposed           business and (b) a principal purpose of the
Temporary Regulations section 1.170A-13T         by the organization to conduct lobbying          contribution is to avoid the general
that discuss the provisions of the law.          and political activities. If the amount of       disallowance rule that would apply if the
                                                 lobbying and political expenses exceed the       contributor conducted such lobbying and
   It is the responsibility of the donor to      amount of dues, etc., for the year, the full     political activities directly (section 170(f)(9)).
obtain, and keep as part of its records, a       amount of dues, etc., is considered
written acknowledgment substantiating its                                                            For details, see Notice 93-55, 1993-2
                                                 allocable to the lobbying and political          C.B. 339 and Announcement 94-8, 1994-3
contribution. However, future regulations        expenses. Any excess lobbying and
will provide guidance to organizations on                                                         I.R.B. 32.
                                                 political expenses are carried forward to
how they can provide substantiation              the next tax year.
information directly to the IRS. If the donee                                                     Specific Instructions
organizations do so, donors will not have           Members of an organization cannot take
to substantiate their contributions              either a section 170 charitable deduction
separately.                                      or a section 162 business expense                Completing the Heading of
                                                 deduction for the portion of their dues
   Donors must continue to file Form 8283,       payment, etc., that is shown on the written      Form 990-EZ
Noncash Charitable Contributions, if their       estimate given to them as being allocable        The instructions that follow are keyed to
deduction for all noncash gifts is more          to the organization’s lobbying and political     items in the heading for Form 990-EZ.
than $500.                                       expenses.
2. Disclosure requirements for quid pro                                                           Item A—Accounting period
                                                    Disclosing the portion of dues, etc.,
quo contributions.—If a charitable               allocable to lobbying and political              Use the 1994 Form 990-EZ to report on a
organization solicits or receives a              expenses is not required for an                  calendar year accounting period beginning
contribution of more than $75 for which          organization that (a) incurs only de minimis     January 1, 1994, and ending December 31,
the organization gives the donor something       amounts of in-house lobbying expenses            1994.
in return (a quid pro quo contribution) the      (not more than $2,000) and no other
organization must inform the donor, by                                                               Also, use the 1994 Form 990-EZ to
                                                 nondeductible lobbying or political              report on an accounting period other than
written statement, that the amount of the        expenses (such as political campaign or
contribution deductible for Federal income                                                        a calendar year (either a fiscal year that
                                                 grassroots lobbying expenses); or                began in 1994 or a short period (less than
tax purposes is limited to the excess over       (b) elects, instead of giving its members a
the value of the goods or services received                                                       12 months) that began in 1994). You must
                                                 written notice of allocation of lobbying and     show the month and day in 1994 that your
by the donor.                                    political expenses, to pay a proxy tax on        fiscal year began or the short period
   The written statement must also provide       those lobbying and political expenses            began. You must also show the day,
the donor with a good-faith estimate of          incurred during the tax year; or                 month, and year your fiscal year or short
goods or services given in return for the        (c) establishes, pursuant to Treasury            period ended. See General Instruction G.
contribution. A written statement is not         regulation (or other procedure), that
required if an organization gave the donor       substantially all of its dues or similar         Item B—Checkboxes
goods or services of insubstantial value.        amounts are not deductible by the persons
(See the instructions for line 1, A2, that       paying them in computing their taxable           Change of address.—If the organization
discuss benefits of nominal value.)              income.                                          changed its address since the previous
                                                                                                  return was filed, check this box.
   A “quid pro quo contribution” is a               If the organization elects not to give its
payment that is given both as a                  members an estimate of anticipated               Initial return.—If this is the organization’s
contribution and as a payment for goods          nondeductible lobbying and political             initial return, check this box.
or services provided by the donee                expenses allocable to dues, etc., then the       Final return.—If this is a final return, check
organization. A quid pro quo contribution        organization is subject to a proxy tax on its    this box. See also the instructions for line
does not include any payment to an               actual lobbying and political expenses           36, Part V, Other Information.
organization, organized exclusively for          allocable to dues for that year. The proxy       Amended return.—If this is an amended
religious purposes, solely for intangible        tax is equal to the amount subject to the        return, check this box. See General
religious benefits not generally sold in a       tax, multiplied by the highest corporate         Instruction J for more details on amending
commercial transaction (section 6115).           rate in effect for the tax year. It is payable   a return.
   An organization that fails to make the        on the Form 990-T.
required disclosure for each quid pro quo           If the organization’s actual nondeductible    Item C—Name and address
contribution will incur a penalty of $10 for     lobbying and political expenses allocable        If we mailed the organization a Form 990
each such failure, not to exceed $5,000 for      to dues for the year exceed its estimate of      Package with a preaddressed mailing label,
a particular fundraising event or mailing,       the allocable amount of such expenses in         attach the label in the name and address
unless it can show reasonable cause for          timely notices of dues disallowance to           space on the organization’s return. Using
not providing such disclosure (section           members, the organization must pay a             the label helps us avoid errors in
6714).                                           proxy tax on the excess. The IRS may             processing the return. If any information on
3. Special rules relating to lobbying and        permit a waiver of this tax if the               the label is wrong, draw a line through that
political activities.—Tax-exempt                 organization agrees to adjust its notice of      part and correct it.
organizations, other than section 501(c)(3)      lobbying and political expenses to
                                                                                                     Include the suite, room, or other unit
organizations, must report their total           members in the following year.
                                                                                                  number after the street address. If the Post
lobbying, political expenses, and                   If an organization elects to pay the proxy    Office does not deliver mail to the street
membership dues, or similar amounts. See         tax rather than to provide its members with      address and the organization has a P.O.
line 35 of Form 990-EZ and its instructions.     an estimate of dues allocable to lobbying        box, show the box number instead of the
At the time of assessment or payment of          and political expenses, all of the members’      street address.
                                                                                                                                          Page 7
Item D—Employer identification number            Item I—Type of organization                     Rounding Off To Whole Dollars
The organization should have only one            If the organization is exempt under section     You may show money items as
Federal employer identification number. If       501(c), check the applicable box and            whole-dollar amounts. Drop any amount
the organization has more than one and           insert, within the parentheses, the number      less than 50 cents and increase any
has not been advised which to use, notify        that identifies the type of section 501(c)      amount from 50 through 99 cents to the
the service center for its area (from the list   organization the filer is. See the chart in     next higher dollar.
in General Instruction H). State what            General Instruction B. If the organization is
numbers the organization has, the name           a section 4947(a)(1) nonexempt charitable       Completing All Lines
and address to which each number was             trust, check the applicable box. See the
assigned, and the address of its principal       discussion in General Instruction D for         Unless the organization is permitted to use
office. The IRS will advise the organization     Schedule A (Form 990) and Form 1041 as          certain DOL forms or Form 5500 series
which number to use.                             well as the instructions for line 42.           returns as partial substitutes for Form
                                                                                                 990-EZ, do not leave any applicable lines
Note: Section 501(c)(9) voluntary                Item J—Gross receipts of $25,000 or             blank or attach any other forms or
employees’ beneficiary associations              less                                            schedules instead of entering the required
must use their own employer                                                                      information on the appropriate line on
identification number and not the                Check this box if the organization’s gross      Form 990-EZ. See General Instruction F.
number of their sponsor.                         receipts are normally not more than
                                                 $25,000. However, if the organization           Assembling Form 990-EZ
Item E—State registration number                 received a Form 990 Package, see General
                                                 Instruction A and the discussion on gross       Before filing the Form 990-EZ, assemble
See General Instruction E.                                                                       the package of forms and attachments in
                                                 receipts in General Instruction C.
Item F—Application pending                                                                       the following order:
                                                 Item K—Calculating gross receipts               ● Form 990-EZ
If the organization’s application for
recognition of exemption is pending, check       Only those organizations with gross             ● Schedule A (Form 990). (The requirement
this box and complete the return.                receipts of less than $100,000 and total        to attach Schedule A (Form 990) applies to
                                                 assets of less than $250,000 at the end of      ALL section 501(c)(3) organizations and
Item G—Accounting method                         the year can use the Form 990-EZ. If the        ALL section 4947(a)(1) nonexempt
                                                 organization does not meet these                charitable trusts.)
Indicate the method of accounting used in        requirements, it must file Form 990. See
preparing this return. Unless instructed                                                         ● Attachments to Form 990-EZ
                                                 the gross receipts discussion in General
otherwise, the organization should               Instruction C.                                  ● Attachments to Schedule A (Form 990)
generally use the same accounting method
on the return to figure revenue and              Public Inspection                               Attachments
expenses that it regularly uses to keep its
books and records. To be acceptable for          All information the organization reports on     Use the schedules on the official form
Form 990-EZ reporting purposes, however,         or with its Form 990-EZ, including              unless more space is needed. If you use
the method of accounting used must               attachments, will be available for public       attachments, please:
clearly reflect income.                          inspection, except the schedule of                1. Show the form number and tax year;
                                                 contributors required for line 1, Part I. The     2. Show the organization’s name and
   If the organization prepares a Form           organization’s forms and attachments
990-EZ for state reporting purposes, it may                                                      employer identification number;
                                                 should be clear enough to photocopy
file an identical return with the IRS even       legibly.                                          3. Clearly identify the Part or line(s) to
though the return does not agree with the                                                        which the attachments relate;
books of account, unless the way one or          Signature
more items are reported on the state return                                                        4. Include the information required by
conflicts with the instructions for preparing    To make the return complete, an officer         the form and use the same format as the
Form 990-EZ for filing with the IRS.             authorized to sign it must sign in the space    form;
                                                 provided. For a corporation, this officer         5. Follow the same Part and line
Example 1. The organization maintains its
                                                 may be the president, vice president,           sequence as the form; and
books on the cash receipts and
                                                 treasurer, assistant treasurer, chief             6. Use the same size paper as the form.
disbursements method of accounting but
                                                 accounting officer, or other corporate
prepares a state return based on the
                                                 officer, such as a tax officer. A receiver,
accrual method. It could use that return for                                                     Part I—Statement of
                                                 trustee, or assignee must sign any return
reporting to the IRS.
Example 2. A state reporting requirement
                                                 he or she files for a corporation. For a        Revenue, Expenses, and
                                                 trust, the authorized trustee(s) must sign.
requires the organization to report certain
                                                    Generally, anyone who is paid to prepare
                                                                                                 Changes in Net Assets, or
revenue, expense, or balance sheet items                                                         Fund Balances
                                                 the return must sign it in the Paid
differently from the way it normally
                                                 Preparer’s Use Only area. The paid              All organizations filing Form 990-EZ with
accounts for them on the books. A Form
                                                 preparer must:                                  the IRS or any state must complete Part I.
990-EZ prepared for that state is
acceptable for the IRS reporting purposes        ● Sign the return, by hand, in the space        Some states that accept Form 990-EZ in
if the state reporting requirement does not      provided for the preparer’s signature           place of their own forms may require
conflict with the Form 990-EZ instructions.      (signature stamps and labels are not            additional information. See General
                                                 acceptable).                                    Instruction E.
   The organization should keep with its
records a reconciliation of any differences      ● Enter the preparer’s social security
                                                 number or employer identification number        Line 1.—Contributions, Gifts,
between its books of account and the
Form 990-EZ it files.                            only if the Form 990-EZ is for a section        Grants, and Similar Amounts
                                                 4947(a)(1) nonexempt charitable trust that      Received
   Most states that accept Form 990-EZ in
                                                 is not filing Form 1041.
place of their own forms require that all
                                                 ● Complete the required preparer                A. What is included on line 1
amounts be reported based on the accrual
method of accounting. See General                information.                                    Report amounts received as voluntary
Instruction E.                                   ● Give a copy of the return to the              contributions; that is, payments, or the part
                                                 organization.                                   of any payment, for which the payer
Item H—Group exemption number                                                                    (donor) does not receive full retail value
                                                    Leave the paid preparer’s space blank if
If the organization is covered by a group                                                        (fair market value) from the recipient
                                                 the return was prepared by a regular
exemption letter, enter the four-digit group                                                     (donee) organization.
                                                 employee of the filing organization.
exemption number (GEN). Contact the                                                                 Enter the gross amounts of
central/parent organization if you are                                                           contributions, gifts, grants, and bequests
unsure of the GEN assigned.                                                                      that the organization received from
Page 8
individuals, trusts, corporations, estates,      market value) is $6.40 or less for all           the public served by the grant recipient.
affiliates, foundations, public charities, and   benefits received by a donor during the          The recipient organization would report
other exempt organizations. Report all           calendar year. These amounts are adjusted        such a grant as income on line 2 (program
related expenses on lines 12 through 16.         annually for inflation. See Rev. Proc. 93-49     service revenue).
1. Contributions can arise from special          cited also in General Instruction R.             2. Donations of services.—Do not include
events when an excess payment is                 3. Section 501(c)(3) organizations.—             the value of services donated to the
received for items offered.—Special              These organizations must compute the             organization, or items such as the free use
events and activities such as dinners,           amounts of revenue and contributions             of materials, equipment, or facilities, as
door-to-door sales of merchandise,               received from special events according to        contributions on line 1. However, for the
carnivals, and bingo games can produce           the above instructions when preparing their      optional reporting of such amounts, see
both contributions and revenue. Report as        Support Schedule in Part IV of Schedule A        the instruction for donated services in Part
a contribution both on line 1 and on line 6a     (Form 990).                                      III.
(within the parentheses) any amount              4. Grants equivalent to contributions.—          3. Section 501(c)(9), (17), and (18)
received through a special event that is         Grants made to encourage an organization         organizations.—These organizations
greater than the retail value of the             receiving the grant to carry on programs or      provide participants with life, sickness,
merchandise or services furnished by the         activities that further the grant recipient’s    accident, welfare, unemployment, pension,
organization to the contributor.                 exempt purposes are grants that are              or similar benefits, or a combination of
   This situation usually occurs when            equivalent to contributions. Report them on      these benefits. When such an organization
organizations seek support from the public       line 1. The grantor may specify which of         receives payments from participants, or
through solicitation programs that are in        the recipient’s activities the grant may be      their employers, to provide these benefits,
part special events or activities and are in     used for, such as an adoption program or         report the payments on line 2 as program
part solicitations for contributions. The        a disaster relief project.                       service revenue, rather than on line 1 as
primary purpose of such solicitations is to         A grant is still equivalent to a              contributions.
receive contributions and not to sell the        contribution if the grant recipient performs
merchandise at its fair market value (retail                                                      C. How to value noncash contributions
                                                 a service, or produces a work product, that
value) even though this might produce a          benefits the grantor incidentally (but see       To report contributions received in a form
profit.                                          line 1 instruction B1 below).                    other than cash, use the market value as
Example. An organization announces that          5. Contributions received through other          of the date of the contribution. For
anyone who contributes at least $40 to the       fundraising organizations.—Contributions         marketable securities registered and listed
organization can choose to receive a book        received indirectly from the public through      on a recognized securities exchange,
worth $16 retail value. A person who gives       solicitation campaigns conducted by              measure market value by the average of
$40, and who chooses the book, is really         federated fundraising agencies (such as          the highest and lowest quoted selling
purchasing the book for $16 and also             United Way) are included on line 1.              prices (or the average between the bona
making a contribution of $24. The                                                                 fide bid and asked prices) on the
contribution of $24, which is the difference     6. Contributions received from                   contribution date. When market value
between the buyer’s payment and the $16          associated organizations.—Include on             cannot be readily determined, use an
retail value of the book, would be reported      line 1 amounts contributed by other              appraised or estimated value.
on line 1 and again on the description line      organizations closely associated with the
                                                 reporting organization. This includes               To determine the amount of any
of 6a (within the parentheses). The revenue                                                       noncash contribution that is subject to an
received ($16 retail value of the book)          contributions received from a parent
                                                 organization, subordinate, or another            outstanding debt, subtract the debt from
would be reported in the amount column                                                            the property’s fair market value. Record
on line 6a. Any expenses directly relating       organization having the same parent.
                                                                                                  the asset at its full value and record the
to the sale of the book would be reported        7. Contributions from a commercial               debt as a liability in the books of account.
on line 6b. Any fundraising expenses             co-venture.—Include amounts contributed          See also the Note for line 1, instruction D,
relating to the contribution of $24 would be     by a commercial co-venture on line 1.            below.
reported on lines 12 through 16.                 These contributions are amounts received
   If a contributor gives more than $40, that    by the organization for allowing an outside      D. Schedule of contributors
person would be making a larger                  organization (donor) or individual to use the
                                                 recipient organization’s name in a sales         (Not open to public inspection) See
contribution, the difference between the                                                          Caution below.
book’s retail value of $16 and the amount        promotion campaign.
actually given. See also the instructions for    8. Contributions or grants from                     Attach a schedule listing each
line 6 and Publication 1391.                     governmental units.—A grant, or other            contributor who, during the year, gave the
                                                 payment from a governmental unit, is             organization, directly or indirectly, money,
Note: At the time of any solicitation or                                                          securities, or other property worth $5,000
payment, organizations that are eligible to      treated as a grant equivalent to a
                                                 contribution if its primary purpose is to        or more. If no one contributed $5,000 or
receive tax-deductible contributions should                                                       more, you do not need to attach a
advise patrons of the amount deductible          enable the recipient to provide a service to,
                                                 or maintain a facility for, the direct benefit   schedule.
for Federal tax purposes. See General
Instruction R.                                   of the public rather than to serve the direct       On the schedule, show each
                                                 and immediate needs of the grantor (even         contributor’s name and address and the
2. Contributions can arise from special          if the public pays part of the expense of        total amount that each contributed. In the
events when items of only nominal value          providing the service or facility). (See also    case of noncash contributions, also show
are given or offered.—If an organization         line 1 instruction B1 below.)                    the date received. Contributors include
offers goods or services of only nominal                                                          individuals, fiduciaries, partnerships,
value through a special event, or                9. Contributions in the form of
                                                 membership dues.—Include on line 1               corporations, associations, trusts, or
distributes free, unordered, low-cost items                                                       exempt organizations.
to patrons, report the entire amount             membership dues and assessments to the
received for such benefits as a contribution     extent they are contributions and not               If an employer withholds contributions
on line 1. Report all related expenses on        payments for benefits received (see line 3,      from employees’ pay and periodically gives
lines 12 through 16.                             instruction C1).                                 them to the organization, report only the
                                                                                                  employer’s name and address and the
   Benefits have a nominal value when:           B. What is not included on line 1                total amount given unless you know that a
   a. The benefit’s fair market value is not     1. Grants that are payments for services         particular employee gave enough to be
more than 2% of the payment, or $64,             are not contributions.—A grant is a              listed separately.
whichever is less; or                            payment for service, and not a                      In determining whether a contributor
   b. The payment is $32 or more; the only       contribution, when the terms of the grant        gave $5,000 or more, total that person’s
benefits received are token items bearing        provide the grantor with a specific service,     gifts of $1,000 or more. Do not include
the organization’s name or symbol; and the       facility, or product, rather than providing a    smaller gifts. If the contribution consists of
organization’s cost (as opposed to fair          benefit to the general public or that part of    property whose fair market value can be

                                                                                                                                       Page 9
determined readily (such as market               by a section 501(c)(9) organization from         meetings, vote or hold office in the
quotations for securities), describe the         participants or employers of participants        organization, and the distinction of being a
property and list its fair market value.         for health and welfare benefits coverage;        member of the organization.
Otherwise, describe the property and             and registration fees received in
estimate its value. Show the date noncash        connection with a meeting or convention.         C. What is not included on line 3
contributions were received.                     2. Program-related investment                    1. Dues or assessments received that
Exception. Section 501(c)(7), (8), or (10)       income.—Program service revenue also             exceed the value of available
organizations that received contributions or     includes income from program-related             membership benefits.—Whether or not
bequests for use only as described in            investments. These investments are made          membership benefits are used, dues
section 170(c)(4), 2055(a)(3), or 2522(a)(3).    primarily to accomplish an exempt purpose        received by an organization, to the extent
  If an organization meets the terms of this     of the investing organization rather than to     they exceed the monetary value of the
exception, some information in its schedule      produce income. Examples are scholarship         membership benefits available to the dues
will vary from that described above.             loans and low-interest loans to charitable       payer, are a contribution that should be
                                                 organizations, indigents, or victims of a        reported on line 1.
  The schedule should list each person           disaster. Rental income received from an
whose gifts total more than $1,000 during                                                         2. Dues received primarily for the
                                                 exempt function is another example of            organization’s support.—If a member
the year. Give the donor’s name, the             program-related investment income. See
amount given, the gift’s specific purpose,                                                        pays dues primarily to support the
                                                 also the instructions for line 4.                organization’s activities, and not to obtain
and the specific use to which it was put. If
an amount is set aside for a purpose             3. Unrelated trade or business                   benefits of more than nominal monetary
described in section 170(c)(4), 2055(a)(3),      activities.—Unrelated trade or business          value, those dues are a contribution to the
or 2522(a)(3), explain how the amount is         activities (not including any special events     organization includible on line 1.
held (for instance, whether it is mingled        or activities) that generate fees for services
with amounts held for other purposes). If        may also be program service activities. A        Line 4—Investment Income
the organization transferred the gift to         social club, for example, should report as
                                                 program service revenue the fees it              A. What is included on line 4
another organization, name and describe
the recipient and explain the relationship       charges both members and nonmembers              1. Interest on savings and temporary
between the two organizations. Also show         for the use of its tennis courts and golf        cash investments.—Enter the amount of
the total of the gifts that were $1,000 or       course.                                          interest received from interest-bearing
less and were for a purpose described in         4. Government fees and contracts.—               checking accounts, savings, and temporary
section 170(c)(4), 2055(a)(3), or 2522(a)(3).    Program service revenue includes income          cash investments, such as money market
                                                 earned by the organization for providing a       funds, commercial paper, certificates of
Note: If the organization qualifies to receive                                                    deposit, and U.S. Treasury bills or other
tax-deductible charitable contributions and      government agency with a service, facility,
                                                 or product that benefited that government        governmental obligations that mature in
receives contributions of property (other                                                         less than 1 year. So-called dividends or
than publicly traded securities) whose fair      agency directly rather than benefiting the
                                                 public as a whole. See the instructions for      earnings received from mutual savings
market value is more than $5,000, the                                                             banks, money market funds, etc., are
organization should usually receive a            line 1, A8, for reporting guidelines when
                                                 payments are received from a government          actually interest and should be included on
partially completed Form 8283 from the                                                            this line.
contributor. The organization should             agency for providing a service, facility, or
complete the appropriate information on          product for the primary benefit of the           2. Dividends and interest from
Form 8283, sign it, and return it to the         general public.                                  securities.—Enter the amount of dividend
donor. The organization should keep a                                                             and interest income from debt and equity
copy for its records. See also the reference     Line 3—Membership Dues and                       securities (bonds and stocks) on this line.
to Form 8282 in General Instruction D.           Assessments                                      Include amounts received from payments
                                                                                                  on securities loans, as defined in section
Caution: If the organization files a copy of     Enter members’ and affiliates’ dues and          512(a)(5).
Form 990-EZ and attachments with any             assessments that are not contributions.
state, do not include, in the attachments        See also General Instruction R.                  3. Gross rents.—Include gross rental
for the state, the schedule of contributors                                                       income received during the year from
discussed above unless the schedule is           A. What is included on line 3                    investment property.
specifically required by the state with          1. Dues and assessments received that            4. Other investment income.—Include, for
which the organization is filing the return.     compare reasonably with available                example, royalty income from mineral
States that do not require the information       benefits.—When the organization receives         interests owned by the organization.
might nevertheless make it available for         dues and assessments that compare
public inspection along with the rest of the     reasonably with membership benefits,             B. What is not included on line 4
return.                                          report such dues and assessments on              1. Capital gains dividends and unrealized
                                                 line 3.                                          gains and losses.—Do not include on this
Line 2—Program Service Revenue                                                                    line any capital gains dividends. They are
                                                 2. Organizations that usually match dues
Including Government Fees and                    and benefits.—Organizations, other than          reported on line 5. Also do not include
Contracts                                        those described in section 501(c)(3),            unrealized gains and losses on investments
                                                 generally provide benefits that have a           carried at market value. See the
Enter the total program service revenue                                                           instructions for line 20.
(exempt function income). Program                reasonable relationship to dues. This
services are primarily those that form the       occurs usually in organizations described        2. Exempt function revenue (program
basis of an organization’s exemption from        in section 501(c)(5), (6), or (7), although      service).—Do not include on line 4
tax.                                             benefits to members may be indirect.             amounts that represent income from an
                                                 Report such dues and assessments on              exempt function (program service). Report
1. Examples. A clinic would include on line      line 3.                                          these amounts on line 2 as program
2 all of its charges for medical services                                                         service revenue. Report expenses related
(whether to be paid directly by the patients     B. Examples of membership benefits               to this income on lines 12 through 16.
or through Medicare, Medicaid, or other
third-party reimbursement), laboratory fees,     These include subscriptions to                      An organization whose exempt purpose
and related charges for services.                publications; newsletters (other than one        is to provide low-rental housing to persons
                                                 about the organization’s activities only);       with low income receives exempt function
   Program service revenue also includes         free or reduced-rate admissions to events        income from such rentals. An organization
tuition received by a school; revenue from       the organization sponsors; use of its            receives exempt function income if it rents
admissions to a concert or other                 facilities; and discounts on articles or         or sublets rental space to a tenant whose
performing arts event or to a museum;            services that both members and                   activities are related to the reporting
royalties received as author of an               nonmembers can buy. In figuring the value        organization’s exempt purpose. Exempt
educational publication distributed by a         of membership benefits, disregard such           function income also arises when an
commercial publisher; payments received          intangible benefits as the right to attend
Page 10
organization rents to an unaffiliated            the cost or other basis, and the expenses       3. Direct expenses.—Report on line 6b
exempt organization at less than fair rental     of sale, and report lump-sum figures in         only the direct expenses attributable to the
value for the purpose of helping that            place of providing the detailed reporting       goods or services the buyer receives from
unaffiliated organization carry out its          required in the above paragraph.                a special event. If you include an expense
exempt purpose. Report rental income                Publicly traded securities include           on line 6b, do not report it again on line
received in these instances on line 2 and        common and preferred stocks, bonds              7b. Fundraising expenses attributable to
not on line 4.                                   (including governmental obligations), and       contributions reported on the description
  Only for purposes of completing Form           mutual fund shares that are listed and          line of 6a (within the parentheses) are
990-EZ, treat income from renting property       regularly traded in an over-the-counter         reportable on lines 12 through 16.
to affiliated exempt organizations as            market or on an established exchange and        B. What is not included on line 6
exempt function income and include such          for which market quotations are published
income on line 2 as program service              or otherwise readily available.                 1. Sales or gifts of goods or services of
revenue.                                                                                         only nominal value.—If the goods or
                                                 Lines 6a–c—Special Events and                   services offered at the special event have
Lines 5a–c—Gains (or Losses)                     Activities                                      only nominal value, include all of the
From Sale of Assets Other Than                                                                   receipts as contributions on line 1 and all
                                                 On the appropriate line, enter the gross        of the related expenses on lines 12
Inventory                                        revenue, expenses, and net income (or           through 16. See line 1, instruction A2, for a
                                                 loss) from all special events and activities,   description of nominal benefits that are
A. What is included on line 5                    such as dinners, dances, carnivals, raffles,    adjusted annually for inflation.
Report on line 5a all sales of securities and    bingo games, other gambling activities,
                                                 and door-to-door sales of merchandise.          2. Sweepstakes, raffles, and lotteries.—
sales of all other types of investments                                                          Report as a contribution, on line 1, the
(such as real estate, royalty interests, or      These activities only incidentally
                                                 accomplish an exempt purpose. Their sole        proceeds of solicitation campaigns in
partnership interests) as well as sales of all                                                   which the names of contributors and other
other noninventory assets (such as               or primary purpose is to raise funds (other
                                                 than contributions) to finance the              respondents are entered in a drawing for
program-related investments and fixed                                                            prizes.
assets used by the organization in its           organization’s exempt activities.
related and unrelated activities).                 This is done by offering goods or               When a minimum payment is required
                                                 services that have more than a nominal          for each raffle or lottery entry and prizes of
   Total the cost or other basis (less                                                           only nominal value are awarded, report any
depreciation) and selling expenses and           value (compared to the price charged) for a
                                                 payment that is more than the direct cost       amount received as a contribution. Report
enter the result on line 5b. On line 5c,                                                         the related expenses on lines 12 through
enter the net gain or loss. Report capital       of those goods or services. See line 1
                                                 instructions A1 and A2 for a discussion on      16.
gains dividends, the organization’s share of
capital gains and losses from a                  contributions reportable on line 1 and          3. Activities that generate only
partnership, and capital gains distributions     revenue reportable on line 6. See also          contributions are not special events.—
from trusts on lines 5a and 5c. Indicate the     General Instruction R.                          An activity that generates only
source on the schedule described below.            Calling any required payment a                contributions, such as a solicitation
                                                 “donation” or “contribution” on tickets,        campaign by mail, is not a special event.
   For this return, you may use the more                                                         Any amount received should be included
convenient way to figure the organization’s      advertising, or solicitation materials does
                                                 not change how these payments should be         on line 1 as a contribution. Related
gain or loss from sales of securities by                                                         expenses are reportable on lines 12
comparing the sales price with the               reported on Form 990-EZ.
                                                                                                 through 16.
average-cost basis of the particular               The gross proceeds from gambling
security sold. However, generally, the           activities and other special events must be     C. Attached schedule
average-cost basis is not used to figure         reported in the amount column on line 6a
the gain or loss from sales of securities                                                        Attach a schedule listing the three largest
                                                 without reduction for cash or noncash
reportable on Form 990-T.                                                                        special events conducted, as measured by
                                                 prizes, cost of goods sold, compensation,
                                                                                                 gross receipts. Describe each of these
                                                 fees, or other expenses.
B. What is not included on line 5                                                                events and indicate for each event: the
                                                 A. What is included on line 6                   gross receipts; the amount of contributions
Do not include on line 5 any unrealized                                                          included in gross receipts (see line 6,
gains or losses on securities that are           1. Gross revenue/contributions.—When            instruction A1 above); the gross revenue
carried in the books of account at market        an organization receives payments for           (gross receipts less contributions); the
value. See the instructions for line 20.         goods or services offered through a special     direct expenses; and the net income (gross
                                                 event, enter:                                   revenue less direct expenses).
C. Attached schedule
                                                    a. As gross revenue, on line 6a (in the         Furnish the same information, in total
1. Nonpublicly traded securities and             amount column) the retail value of the          figures, for all other special events held
noninventory items.—Attach a schedule            goods or services.                              that are not among the largest three.
to show the sale or exchange of
                                                    b. As a contribution, on both line 1 and     Indicate the type and number of the events
nonpublicly traded securities and the sale
                                                 line 6a (within the parentheses) any            not listed individually (for example, three
or exchange of other assets that are not
                                                 amount received that exceeds the retail         dances and two raffles).
inventory items. The schedule should show
security transactions separately from the        value of the goods or services given.              An example of this schedule might
sale of other assets. Show for these             Example. At a special event, an                 appear in columnar form as follows:
assets:                                          organization received $100 in gross             Special Event:         (A)   (B)   (C)    (D) Total
● Date acquired and how acquired,                receipts for goods valued at $40. The
                                                 organization entered gross revenue of $40       Gross Receipts         $xxx $xxx $xxx $xxx $xxx
● Date sold and to whom sold,                    on line 6a and entered a contribution of        Less: Contributions     xxx xxx xxx xxx xxx
● Gross sales price,                             $60 on both line 1 and within the               Gross Revenue           xxx xxx xxx xxx xxx
● Cost, other basis, or if donated, value at     parentheses on line 6a. The contribution        Less: Direct
                                                                                                                         xxx xxx xxx xxx xxx
                                                 was the difference between the gross            Expenses
time acquired (state which),                                                                     Net Income or (loss)   $xxx $xxx $xxx $xxx $xxx
                                                 revenue of $40 and the gross receipts of
● Expense of sale and cost of                    $100.                                              If you use this format, report the total for
improvements made after acquisition, and                                                         contributions on line 1 of Form 990-EZ and
                                                 2. Raffles or lotteries.—Report as
● Depreciation since acquisition, if             revenue, on line 6a, any amount received        on line 6a (within the parentheses of the
depreciable property.                            from raffles or lotteries that require          description line). Report the totals for gross
                                                 payment of a specified minimum amount           revenue, in the amount column, on line 6a;
2. Publicly traded securities.—For sales
                                                 for each entry, unless the prizes awarded       direct expenses on line 6b; and net income
of publicly traded securities through a
                                                 have only nominal value. See line 6             or (loss) on line 6c.
broker, you may total the gross sales price,
                                                 instruction B1 and B2 below.
                                                                                                                                          Page 11
D. Fundraising recordkeeping                      Line 10—Grants and Similar                     on line 10. Specify both the amount and
                                                                                                 purpose of these payments.
Section 501(c) organizations that are             Amounts Paid
eligible to receive tax-deductible                                                                 Classify activities on this schedule in
contributions under section 170(c) of the         A. What is included on line 10                 more detail than by using such broad
Code must keep sample copies of their                                                            terms as charitable, educational, religious,
                                                  Enter the amount of actual grants and
fundraising materials, such as dues                                                              or scientific. For example, identify
                                                  similar amounts paid to individuals and
statements or other fundraising                                                                  payments to affiliates; payments for
                                                  organizations selected by the filing
solicitations, tickets, receipts, or other                                                       nursing services; fellowships; or payments
                                                  organization. Include scholarship,
evidence of payments received in                                                                 for food, shelter, or medical services for
                                                  fellowship, and research grants to
connection with fundraising activities. If                                                       indigents or disaster victims. For payments
organizations advertise their fundraising                                                        to indigent families, do not identify the
events, they must keep samples of the             1. Specific assistance to individuals.—        individuals.
advertising copy. If they use radio or            Include on this line the amount of
                                                                                                   If an organization gives property other
television to make their solicitations, they      payments to, or for the benefit of,
                                                                                                 than cash and measures an award or grant
must keep samples of scripts, transcripts,        particular clients or patients, including
                                                                                                 by the property’s fair market value, also
or other evidence of on-air solicitations. If     assistance by others at the expense of the
                                                                                                 show on this schedule:
organizations retain outside fundraisers,         filing organization.
                                                                                                 ● A description of the property,
they must keep samples of the fundraising         2. Payments, voluntary awards, or grants
materials used by the outside fundraisers.        to affiliates.—Include on line 10 certain      ● The book value of the property,
For each fundraising event, organizations         types of payments to organizations             ● How you determined the book value,
must keep records to show that portion of         “affiliated with” (closely related to) the
                                                                                                 ● How you determined the fair market
any payment received from patrons which           reporting organization. These payments
                                                                                                 value, and
is not deductible; that is, the retail value of   include predetermined quota support and
the goods or services received by the             dues payments by local organizations to        ● The date of the gift.
patrons. See also General Instruction R.          their state or national organizations.           Any difference between a property’s fair
                                                  Note: If the organization uses Form 990-EZ     market value and book value should be
Lines 7a–c—Gross Sales of                         for state reporting purposes, be sure to       recorded in the organization’s books of
Inventory                                         properly distinguish between payments to       account and on line 20.
1. Sales of inventory.—Include on line 7a         affiliates and awards and grants. See
                                                  General Instruction E.                         Line 11—Benefits Paid To or For
the gross sales (less returns and
allowances) of inventory items, whether the                                                      Members
                                                  B. What is not included on line 10
sales activity is an exempt function or an                                                       For an organization that gives benefits to
unrelated trade or business. Include all          1. Administrative expenses.—Do not             members or dependents (such as
inventory sales except sales of goods at          include on this line expenses made in          organizations exempt under section
special events, which are reportable on line      selecting recipients or monitoring             501(c)(8), (9), or (17)), enter the amounts
6.                                                compliance with the terms of a grant or        paid for: (a) death, sickness,
2. Cost of goods sold.—On line 7b, report         award. Enter those expenses on lines 12        hospitalization, or disability benefits;
the cost of goods sold related to sales of        through 16.                                    (b) unemployment compensation benefits;
such inventory. The usual items included in       2. Purchases of goods or services from         and (c) other benefits. Do not include, on
cost of goods sold are direct and indirect        affiliates.—Do not report the cost of          this line, the cost of employment-related
labor, materials and supplies consumed,           goods or services purchased from affiliates    benefits the organization gives its officers
freight-in, and a proportion of overhead          on line 10. Report these as expenses on        and employees. Report them on line 12.
expenses. Marketing and distribution              lines 12 through 16.
expenses are not includible in cost of            3. Membership dues paid to another
                                                                                                 Line 12—Salaries, Other
goods sold. Include those expenses on             organization.—Report membership dues           Compensation, and Employee
lines 12 through 16.                              that the organization pays to another          Benefits
3. Investments.—Do not include on line 7          organization for general membership
sales of investments on which the                 benefits, such as regular services,            Enter the total salaries and wages paid to
organization expected to profit by                publications, and materials on line 16, as     all employees and the fees paid to officers,
appreciation and sale. Report sales of            “Other expenses.”                              directors, and trustees. Include the total of
these investments on line 5.                                                                     the employer’s share of the contributions
                                                  C. Attached schedule                           the organization paid to qualified and
Line 8—Other Revenue                                                                             nonqualified pension plans and the
                                                  Attach a schedule to explain the amounts       employer’s share of contributions to
Enter the total income from all sources not       reported on line 10. Show on this              employee benefit programs (such as
covered by lines 1 through 7. Examples of         schedule:                                      insurance, health, and welfare programs)
types of income includible on line 8 are          ● Each class of activity,                      that are not an incidental part of a pension
interest on notes receivable not held as          ● The donee’s name and address,                plan. Complete the Form 5500 series
investments or as program-related                                                                return/report that is appropriate for the
investments (defined in the line 2                ● The amount given, and                        organization’s plan.
instructions); interest on loans to officers,     ● The relationship of the donee (in the           Also include in the total the amount of
directors, trustees, key employees, and           case of grants to individuals) if the          Federal, state, and local payroll taxes for
other employees; and royalties that are not       relationship is by blood, marriage,            the year that are imposed on the
investment income or program service              adoption, or employment (including             organization as an employer. This includes
revenue.                                          employees’ children) to any person or          the employer’s share of social security and
                                                  corporation with an interest in the            Medicare taxes, Federal unemployment tax
Line 9—Total Revenue                              organization, such as a creator, donor,        (FUTA), state unemployment compensation
Add lines 1, 2, 3, 4, 5c, 6c, 7c, and 8 to        director, trustee, officer, etc.               tax, and other state and local payroll taxes.
determine the amount of total revenue.               Any grants reported on line 10 that were    Taxes withheld from employees’ salaries
   You may also use the amount on this            approved during the year but not paid by       and paid over to the various governmental
line to determine quickly whether the             the due date for filing Form 990-EZ            units (such as Federal and state income
organization’s gross receipts are less than       (including extensions) must be identified      taxes and the employees’ share of social
$100,000. If an organization’s gross              and listed separately in the line 10           security and Medicare taxes) are part of
receipts are $100,000 or more, it must file       schedule.                                      the employees’ salaries included on line
Form 990. See General Instruction C for              Give the name and address of each           12. Report expenses paid or incurred for
information on calculating gross receipts.        affiliate that received any payment reported   employee events such as a picnic or
                                                                                                 holiday party on this line.

Page 12
Line 13—Professional Fees and                   Line 18—Excess or (Deficit) for the              Line 24—Other Assets
Other Payments to Independent                   Year                                             Enter the total of other assets along with a
Contractors                                     Enter the difference between lines 9 and         description of those assets. Amounts to
                                                17. If line 17 is more than line 9, enter the    include here are (among others) receivable
Enter the total amount of legal, accounting,                                                     accounts, inventories, and prepaid
auditing, other professional fees (such as      difference in parentheses.
fees for fundraising or investment services)
and related expenses charged by outside         Line 19—Net Assets or Fund
                                                                                                 Line 25—Total Assets
firms and individuals who are not               Balances at Beginning of Year
employees of the organization. Do not                                                            Enter the amount of total assets. If the
                                                Enter the amount from the prior year’s           end-of-year total assets entered in column
include any penalties, fines, or judgments      balance sheet or from Form 5500,
imposed against the organization as a                                                            (B) are $250,000 or more, Form 990 must
                                                5500-C/R, or an approved DOL form if             be filed instead of Form 990-EZ.
result of legal proceedings. Report and         General Instruction F applies.
identify those expenses on line 16. Report
fees paid to directors and trustees on line                                                      Line 26—Total Liabilities
                                                Line 20—Other Changes in Net
12.                                                                                              Enter the amount of total liabilities along
                                                Assets or Fund Balances                          with their description.
Line 14—Occupancy, Rent,                        Attach a statement explaining any changes
Utilities, and Maintenance                      in net assets or fund balances between the       Line 27—Net Assets or Fund
                                                beginning and end of the year that are not       Balances
Enter the total amount paid or incurred for     accounted for by the amount on line 18.
the use of office space or other facilities,    Amounts to report here include                   Subtract line 26 (total liabilities) from line
heat, light, power, and other utilities,        adjustments of earlier years’ activity;          25 (total assets) to determine net assets.
outside janitorial services, mortgage           unrealized gains and losses on investments       Enter this net asset amount on line 27. The
interest, real estate taxes and property        carried at market value; and any difference      amount entered in column (B) should agree
insurance attributable to rental property,      between fair market value and book value         with the net asset amount on line 21.
and similar expenses. Do not subtract from      of property given as an award or grant.            States that accept Form 990-EZ as their
rental expenses reported on line 14 any                                                          basic report form may require a separate
rental income received from renting or                                                           statement of changes in fund balances.
subletting rented space. See instructions       Part II—Balance Sheets                           See General Instruction E.
for line 2 and 4 to determine whether such      All organizations, except those that meet
income is reportable as exempt function         one of the exceptions in General
income or investment income. However,           Instruction F, must complete columns (A)         Part III—Statement of
report on line 14 any rental expenses for       and (B) of Part II of the return and may not     Program Service
rental income reported on lines 2 and 4. If     submit a substitute balance sheet. Failure
the organization records depreciation on        to complete Part II may result in penalties
property it occupies, enter the total for the   for filing an incomplete return. See General     State the organization’s primary exempt
year.                                           Instruction K.                                   purpose in the space provided.
   For an explanation of acceptable             Note: Organizations using fund accounting          Provide the information specified in the
methods for computing depreciation, see         must combine similar accounts from all of        heading for Part III for each of the
Pub. 534, Depreciation, or Pub. 946, How        their funds and report these asset, liability,   organization’s three largest program
to Begin Depreciating Your Property.            and fund balance totals on the appropriate       services (as measured by total expenses
                                                lines of the balance sheet.                      incurred) or for each program service if the
Line 15—Printing, Publications,                                                                  organization engaged in three or fewer of
                                                   Some states require more information.
Postage, and Shipping                           See General Instruction E for more               such activities.
Enter the printing and related costs of         information about completing a Form                If part of the total expenses of any
producing the reporting organization’s own      990-EZ to be filed with any state or local       program service consists of grants
newsletters, leaflets, films, and other         government agency.                               reported on line 10, show the amount of
informational materials. Include the costs                                                       the grants in the space provided. Section
of outside mailing services on this line.       Line 22—Cash, Savings, and                       501(c)(3) and (4) organizations and section
Also include the cost of any purchased          Investments                                      4947(a)(1) nonexempt charitable trusts
publications as well as postage and                                                              must show the amount of grants to others.
shipping costs not reportable on lines 5b,      Include the total of non-interest-bearing
                                                checking accounts, deposits in transit,            Only section 501(c)(3) and (4)
6b, or 7b. Do not include any expenses,                                                          organizations and section 4947(a)(1)
such as salaries, for which a separate line     change funds, petty cash funds, or any
                                                other non-interest-bearing account.              nonexempt charitable trusts must enter
is provided.                                                                                     the total expenses of each program service
                                                  Include the total of interest-bearing          they reported in Part III. Completing the
Line 16—Other Expenses                          checking accounts, savings and temporary         expense column in Part III is optional for all
Include here such expenses as penalties,        cash investments, such as money market           other organizations.
fines, and judgments; unrelated business        funds, commercial paper, certificates of
                                                deposit, and U.S. Treasury bills or other          A program service is a major (usually
income taxes; insurance and real estate                                                          ongoing) objective of an organization such
taxes not attributable to rental property or    governmental obligations that mature in
                                                less than 1 year. Report the income from         as adoptions, recreation for the elderly,
reported as occupancy expenses;                                                                  rehabilitation, or publication of journals or
depreciation on investment property; travel     these investments on line 4. Include the
                                                book value (which may be market value) of        newsletters. Describe program service
and transportation costs; interest expense;                                                      accomplishments through measurements
and expenses for conferences,                   securities held as investments. Include the
                                                amount of all other investment holdings          such as clients served, days of care,
conventions, and meetings.                                                                       therapy sessions, or publications issued.
                                                including land and buildings held for
   Some states that accept Form 990-EZ in       investment.                                        If the quantity of output is intangible
satisfaction of their filing requirements may                                                    services, as in a research activity, describe
require that certain types of miscellaneous     Line 23—Land and Buildings                       the objective of the activity for this time
expenses be itemized. See General                                                                period as well as the overall longer-term
Instruction E.                                  Enter the book value (cost or other basis
                                                less accumulated depreciation) of all land
                                                and buildings owned by the organization            Give reasonable estimates for any
                                                and not held for investment.                     statistical information if exact figures are
                                                                                                 not readily available from the records the
                                                                                                 organization normally maintains. Indicate

                                                                                                                                    Page 13
that the information provided is an               Include current-year payments of amounts         year. Also include any major program
estimate.                                         reported or reportable as deferred               activities that are being discontinued.
1. Donated services.—If the organization          compensation in any prior year.
so chooses, show in the narrative section                                                          Line 34—Changes in Organizing or
                                                  Column (D)                                       Governing Documents
of Part III the value of any donated
services or use of materials, equipment, or       Include in this column all forms of deferred     Attach a conformed copy of any changes
facilities received and utilized in connection    compensation and future severance                to the articles of incorporation,
with specific program services. Do not            payments (whether or not funded; whether         constitution, trust instrument, or other
include these amounts in the expense              or not vested; and whether or not the            organizing document, or to the bylaws or
column in Part III.                               deferred compensation plan is a qualified        other governing document.
2. Reporting other program services and           plan under section 401(a)). Include also
                                                  payments to welfare benefit plans on               A “conformed copy” is one that agrees
expenses.—Attach a schedule that lists                                                             with the original document and all
the organization’s other program services.        behalf of the officers, etc. Such plans
                                                  provide benefits such as medical, dental,        amendments to it. If the copies are not
The detailed information required in Part III                                                      signed, they must be accompanied by a
for the three largest services is not             life insurance, severance pay, disability,
                                                  etc. Reasonable estimates may be used if         written declaration signed by an officer
required for the services listed on this                                                           authorized to sign for the organization,
schedule. However, section 501(c)(3) and          precise cost figures are not readily
                                                  available.                                       certifying that they are complete and
(4) organizations as well as section                                                               accurate copies of the original documents.
4947(a)(1) nonexempt charitable trusts               Unless the amounts were reported in
should also report the expenses                   column (C), report, as deferred                    Photocopies of articles of incorporation
attributable to their program services.           compensation in column (D), salaries and         showing the certification of an appropriate
                                                  other compensation earned during the             state official need not be accompanied by
                                                  period covered by the return, but yet not        such a declaration. See Rev. Proc. 68-14,
Part IV—List of Officers,                         paid by the date the organization files its      1968-1 C.B. 768, for details. When a
Directors, Trustees, and Key                      return.                                          number of changes are made, attach a
                                                                                                   copy of the entire revised organizing
Employees                                         Column (E)                                       instrument or governing document.
List each person who was an officer,              Enter both taxable and nontaxable fringe
director, trustee, or key employee (defined                                                        Line 35—Unrelated Business
                                                  benefits (other than de minimis fringe
below) of the organization at any time            benefits described in section 132(e)).           Income and Lobbying Proxy Tax
during the year even if they did not receive      Include amounts that the recipients must
any compensation from the organization.                                                            Unrelated business income
                                                  report as income on their separate income
Enter a zero in columns (C), (D), or (E) if no    tax returns. Examples include amounts for        Check “Yes” on line 35a if the
compensation, contributions, expenses             which the recipient did not account to the       organization’s total gross income from all
and other allowances were paid during the         organization or allowances that were more        of its unrelated trades and businesses is
reporting year, or deferred for payment to        than the payee spent on serving the              $1,000 or more for the year. Gross income
a future accounting period. Give the              organization. Include payments made              is gross receipts less the cost of goods
preferred address at which officers, etc.,        under indemnification arrangements, the          sold. See Pub. 598 for a description of
want the Internal Revenue Service to              value of the personal use of housing,            unrelated business income and the Form
contact them. Use an attachment if there          automobiles, or other assets owned or            990-T filing requirements. Form 990-T is
are more than four persons to list in Part        leased by the organization (or provided for      not a substitute for Form 990-EZ. Items
IV.                                               the organization’s use without charge), as       of income and expense reported on Form
   Show all forms of cash and noncash             well as any other taxable and nontaxable         990-T must also be reported on Form
compensation received by each listed              fringe benefits. See Pub. 525 for more           990-EZ when the organization is required
officer, etc., whether paid currently or          information.                                     to file both forms.
deferred.                                            Form 941 must be filed to report income       Note: All tax-exempt organizations must
   The organization may also provide an           tax withholding and social security and          pay estimated taxes with respect to their
attachment to explain the entire 1994             Medicare taxes. The organization must            unrelated business income if they expect
compensation package for any person               also file Form 940 to report Federal             their tax liability to be $500 or more. Use
listed in Part IV.                                unemployment tax, unless the organization        Form 990-W to compute this tax.
   A “key employee” is any person having          is not subject to these taxes. See Circular
                                                  E, Employer’s Tax Guide, for more                Lobbying expenses
responsibilities or powers similar to those
of officers, directors, or trustees. The term     information. See also the Trust Fund             Check “Yes” to line 35a if the organization
includes the chief management and                 Recovery Penalty discussion in General           was subject to the notice and reporting
administrative officials of an organization       Instruction D for Form 941.                      requirements (and therefore potentially
(such as an executive director or                                                                  incurred liability for the proxy tax) for
chancellor) but does not include the heads        Part V—Other Information                         lobbying and political expenses incurred in
of separate departments or smaller units                                                           the 1994 reporting year. You must
                                                  Note: Section 501(c)(3) organizations and
within an organization.                                                                            complete lines 85a-h on page 4 of Form
                                                  section 4947(a)(1) nonexempt charitable
   A chief financial officer and the officer in                                                    990 and attach that page to your Form
                                                  trusts must also complete and attach a
charge of administration or program                                                                990-EZ. You need not complete any of the
                                                  Schedule A (Form 990) to their Form
operations are both key employees if they                                                          other lines on page 4 of Form 990. See the
                                                  990-EZ (or Form 990). See the discussion
have the authority to control the                                                                  Form 990 instructions before completing
                                                  in General Instruction D for Schedule A
organization’s activities, its finances, or                                                        lines 85a-h.
                                                  (Form 990).
both. The “heads of separate departments”                                                             The notice and reporting requirements
reference applies to persons such as the          Line 33—Change in Activities                     (and the proxy tax) only apply to certain
heads of the radiology department or                                                               organizations exempt under sections
coronary care unit of a hospital or the head      Attach a statement explaining any                501(c)(4), (5), and (6). Therefore,
of the chemistry or history or English            significant changes in the kind of activities    organizations that are not classified as
department at a college. These persons            the organization conducts to further its         tax-exempt under Code sections 501(c)(4),
are managers within their specific areas          exempt purpose. Include new or modified          (5), and (6) should check “No” to line 35a
but not for the organization as a whole           activities not listed as current or planned in   unless they had unrelated business income
and, therefore, are not key employees.            the organization’s application for               as described above.
                                                  recognition of exemption or not already
Column (C)                                        made known to the IRS by a letter to its            Note that most section 501(c)(4) and (5)
                                                  key district director or by an attachment to     organizations are exempt from the notice
For each person listed, report salary, fees,      the organization’s return for any earlier        and reporting requirements (and the proxy
bonuses, and severance payments paid.                                                              tax) under Exception 1, described below.
Page 14
   If you check “No” to line 35a, you are          4. Section 501(c)(4), (5), and (6)            or incurred for research for, or preparation,
certifying that the organization was not         organizations more than 90% of whose            planning or coordination of, legislative
subject to the notice and reporting              members are section 501(c)(3)                   activities), but does not include any
requirements and that the organization had       organizations.                                  payments to other taxpayers engaged in
no lobbying and political expenditures             5. Any organization that receives a           lobbying or political activities as a trade or
potentially subject to the proxy tax.            private letter ruling from the IRS that it      business. In-house expenditures also do
   If you check “No” to line 35a and the         satisfies the section 6033(e)(3) exception.     not include any dues paid to another
organization actually had expenditures                                                           organization that are allocable to lobbying
                                                   6. Any organization that is not a             or political activities.
subject to the proxy tax, the underreported      membership organization.
lobbying and political expenditures are
subject to the section 6033(e) proxy tax for       If your organization meets any of the         Line 36—Liquidation, Dissolution,
the 1994 reporting year only to the extent       above criteria, you do not need to              Termination, or Substantial
that the same expenditures (if actually          complete and attach lines 85a-h of Form
                                                 990.                                            Contraction
reported) would have resulted in a proxy
tax liability for that year. A waiver of proxy                                                   If there was a liquidation, dissolution,
                                                 Exception 2. $2,000 in-house lobbying           termination, or substantial contraction,
tax only applies to reported expenditures.       exception                                       attach a statement explaining what took
   An organization must pay the section                                                          place.
6033(e) tax on the amount reportable on          Section 6033(e)(1) provides an exception
line 85f of Form 990 unless it has the           for any organization whose only lobbying           For a complete liquidation of a
option of agreeing to increase its following     and political expenditures consisted of         corporation or termination of a trust, check
year’s reasonable estimate of dues               in-house lobbying expenditures for direct       the “Final Return” box in the heading of
allocable to nondeductible lobbying and          lobbying activities (defined below) and the     the return. On the attached statement,
political expenditures pursuant to Notice        total of such expenditures was $2,000 or        show whether the assets have been
93-55, if applicable, or pursuant to the         less.                                           distributed and the date. Also attach a
option to check “Yes” on line 85h of Form        An organization satisfies the $2,000            certified copy of any resolution, or plan of
990. See the Form 990 instructions. The          in-house lobbying exception if (a) it made      liquidation or termination, etc., with all
organization may also be subject to the          no political expenditures or foreign            amendments or supplements not already
$10 per day penalty under section 6652(c)        lobbying expenditures during the 1994           filed. In addition, attach a schedule listing
for filing an incomplete or inaccurate           reporting year, (b) its only lobbying           the names and addresses of all persons
return.                                          expenditures (if any) during the 1994           who received the assets distributed in
                                                 reporting year consisted of in-house direct     liquidation or termination; the kinds of
   Even if an organization is classified as                                                      assets distributed to each one; and each
tax-exempt under sections 501(c)(4), (5), or     lobbying expenditures aggregating $2,000
                                                 or less, excluding any allocable overhead       asset’s fair market value.
(6), it will still be exempted from the notice
and reporting requirements (and the proxy        expenses, and (c) the organization did not         A “substantial contraction” is a partial
tax) if it meets either of the two exceptions    receive a waiver for proxy tax owed for the     liquidation or other major disposition of
below. Thus, if the organization satisfies       prior year. Also excluded in determining        assets except transfers for full
Exception 1 or 2, it does not need to            whether the $2,000 ceiling amount was           consideration or distributions from current
complete and attach lines 85a–h of Form          exceeded are all direct lobbying                income.
990.                                             expenditures of any local council or similar       A “major disposition of assets” means
                                                 governing body, with respect to legislation     any disposition for the tax year that is:
Exception 1. Section 6033(e)(3)                  or proposed legislation of direct interest to
exception for nondeductible dues                 the organization or its members.                   1. At least 25% of the fair market value
                                                                                                 of the organization’s net assets at the
Section 6033(e)(3) provides an exception            If the organization’s in-house direct        beginning of the tax year; or
for any organization substantially all of        lobbying expenditures during the 1994
                                                 reporting year were $2,000 or less, but the        2. One of a series of related dispositions
whose dues would not be deductible by                                                            begun in earlier years that, together, add
members as business expenses or                  organization also made other lobbying or
                                                 political expenditures during the 1994          up to at least 25% of the net assets the
employee business expenses whether or                                                            organization had at the beginning of the
not the organization made any lobbying           reporting year, or received a waiver for
                                                 proxy tax owed for the prior year, it should    tax year when the first disposition in the
and political expenditures.                                                                      series was made. Whether a major
                                                 answer “No” to question 85b of Form 990
   Specific guidelines regarding this            and complete lines 85c through 85h.             disposition of assets took place through a
exception are provided in Announcement           However, the $2,000 or less of in-house         series of related dispositions depends on
94-8. This announcement contains a               direct lobbying expenditures should not be      the facts in each case.
proposed revenue procedure that the IRS          included in the total on line 85d.                 See Regulations section 1.6043-3 for
will follow until a final procedure is                                                           special rules and exceptions.
adopted. These guidelines treat the                 “Direct lobbying” includes (a) attempting
following classes of organizations as            to influence legislation through
                                                 communication with legislators, legislative     Line 37—Expenditures for Political
meeting the section 6033(e)(3) exception:
                                                 branch officials and staff, and other           Purposes
   1. Section 501(c)(4) and (5) organizations    government officials who may participate in
that do not receive annual dues (or similar                                                      A political expenditure is one intended to
                                                 the formulation of legislation and
amounts) of more than $50 from any                                                               influence the selection, nomination,
                                                 (b) attempting to influence the official
member.                                                                                          election, or appointment of anyone to a
                                                 actions or positions of covered Federal
                                                                                                 Federal, state, or local public office, or
   If some members pay more than $50,            Executive Branch officials through direct
                                                                                                 office in a political organization, or the
this exception is still considered met if the    communication with such officials, but
                                                                                                 election of Presidential or Vice Presidential
total of all dues (and similar amounts) paid     does not include attempting to influence
                                                                                                 electors. It does not matter whether the
by these members is not more than 10%            any local council or similar governing body
                                                                                                 attempt succeeds.
of the total dues (and similar amounts) paid     with respect to legislation or proposed
by all members.                                  legislation of direct interest to the              An expenditure includes a payment,
                                                 organization or its members.                    distribution, loan, advance, deposit, or gift
   2. Local associations of employees’ and
                                                                                                 of money, or anything of value. It also
veterans’ organizations described in                Direct lobbying also does not include
                                                                                                 includes a contract, promise, or agreement
section 501(c)(4), but not social welfare        any attempt to influence any segment of
                                                                                                 to make an expenditure, whether or not
organizations.                                   the general public regarding legislative
                                                                                                 legally enforceable.
   3. Labor unions and other labor               matters or referendums (grassroots
                                                 lobbying).                                      1. All section 501(c) organizations.—
organizations described in section
                                                                                                 Section 501(c) organizations must file Form
501(c)(5), but not agricultural and                 “In-house expenditures” include salaries
                                                                                                 1120-POL if their political expenditures and
horticultural organizations.                     and other expenses of the organization’s
                                                                                                 their net investment income both exceed
                                                 officials and staff (including amounts paid
                                                                                                 $100 for the year.
                                                                                                                                    Page 15
    Section 501(c) organizations that           16 and any interest income on line 2, 4, or      Gross receipts do not include capital
maintained separate segregated funds            8, depending on the nature of the                contributions (as defined in Regulations
described in section 527(f)(3) should refer     receivable that created the interest income.     section 1.118-1), initiation fees, or unusual
to the instructions for Form 1120-POL for       (a) When loans should be reported                amounts of income such as income
filing requirements.                            separately.—In the required schedule,            received from the club’s selling its
    A section 527(f)(3) separate segregated     report each loan separately, even if more        clubhouse. Although gross receipts usually
fund’s receipts, expenditures, and balance      than one loan was made to or received            do not include initiation fees, these should
sheet items should not be included on the       from the same person, or the same terms          be included for college fraternities or
Form 990-EZ (or Form 990) of the section        apply to all loans made. Salary advances         sororities or other organizations that
501(c) organization that maintained the         and other advances for the personal use          charge membership initiation fees, but not
fund. The section 501(c) organization           and benefit of the recipient, and                annual dues.
should also disregard the separate              receivables subject to special terms or             If the 35% and 15% limits do not affect
segregated fund’s political expenditures        arising from nontypical transactions, must       the club’s exempt status, include the
and Form 1120-POL filing requirement (if        be reported as separate loans for each           income from line 39b on the club’s Form
any) in answering questions 37a and 37b.        officer, director, trustee, and key              990-T.
2. Section 501(c)(3) organizations.—A           employee.                                           Investment income earned by a section
section 501(c)(3) organization will lose its    (b) When loans should be reported as a           501(c)(7) organization is not tax-exempt
tax-exempt status if it engages in political    single total.—In the required schedule,          income unless it is set aside to be used
activity.                                       report receivables that are subject to the       only for religious, charitable, scientific,
    A section 501(c)(3) organization must pay   same terms and conditions (including             literary, or educational purposes, or for the
an excise tax for any amount paid or            credit limits and rate of interest) as           prevention of cruelty to children or animals.
incurred on behalf of, or in opposition to,     receivables due from the general public          The organization is required to file Form
any candidate for public office. The            (occurring in the normal course of the           990-T and report its investment income
organization must pay an additional excise      organization’s operations) as a single total     along with the organization’s other
tax if it fails to correct the expenditure      for all the officers, directors, trustees, and   unrelated business income if the combined
timely.                                         key employees. Report travel advances for        amount of gross investment income and
                                                official business of the organization as a       other unrelated business income exceeds
    A manager of a section 501(c)(3)            single total.                                    $1,000.
organization who knowingly agrees to a
political expenditure must pay an excise        (c) Schedule format.—For each                    2. Nondiscrimination policy.—A section
tax, unless the agreement is not willful and    outstanding loan or other receivable that        501(c)(7) organization is not exempt from
there is reasonable cause. A manager who        must be reported separately, the attached        income tax if any written policy statement,
does not agree to a correction of the           schedule should show the following               including the governing instrument and
political expenditure may have to pay an        information (preferably in columnar form):       bylaws, allows discrimination on the basis
additional excise tax.                          ● Borrower’s name and title;                     of race, color, or religion.
    When an organization promotes a             ● Original amount;                                  However, section 501(i) allows social
candidate for public office (or is used or                                                       clubs to retain their exemption under
                                                ● Balance due;                                   section 501(c)(7) even though their
controlled by a candidate or prospective
candidate), amounts paid or incurred for        ● Date of note;                                  membership is limited (in writing) to
the following purposes are political            ● Maturity date;                                 members of a particular religion if:
expenditures:                                   ● Repayment terms;                                  a. The social club is an auxiliary of a
● Remuneration to the individual (a                                                              fraternal beneficiary society that is exempt
                                                ● Interest rate;                                 under section 501(c)(8) and limits its
candidate or prospective candidate) for
speeches or other services;                     ● Security provided by the borrower;             membership to the members of a particular
                                                ● Purpose of the loan; and                       religion; or
● Travel expenses of the individual;
                                                ● Description and fair market value of the          b. The social club’s membership
● Expenses of conducting polls, surveys,                                                         limitation is a good faith attempt to further
or other studies, or preparing papers or        consideration furnished by the lender (for
                                                example, cash—$1,000; or 100 shares of           the teachings or principles of that religion,
other material for use by the individual;                                                        and the limitation is not intended to
                                                XYZ, Inc., common stock—$9,000).
● Expenses of advertising, publicity, and                                                        exclude individuals of a particular race or
fundraising for such individual; and               The above detail is not required for          color.
                                                receivables or travel advances that may be
● Any other expense that has the primary        reported as a single total. However, report         If the club answered “Yes” to the
effect of promoting public recognition or       and identify those totals separately in the      question on line 39c and section 501(i)
otherwise primarily accruing to the benefit     attachment.                                      applies, indicate in an attached statement
of the individual.                                                                               which of the above exceptions of section
    Use Form 4720 to figure and report the      Line 39—Section 501(c)(7)                        501(i) applies.
excise taxes.                                   Organizations                                    Line 40—List of States
Line 38—Loans To or From                        1. Gross receipts test.—A section                List each state with which the organization
                                                501(c)(7) organization may receive up to         is filing a copy of this return in full or
Officers, Directors, Trustees, and              35% of its gross receipts, including             partial satisfaction of state filing
Key Employees                                   investment income, from sources outside          requirements.
Enter the end-of-year unpaid balance of         its membership and remain tax exempt.
secured and unsecured loans made to or          Part of the 35% (up to 15% of gross              Line 42—Section 4947(a)(1)
received from officers, directors, trustees,    receipts) may be derived from public use
                                                of a social club’s facilities.                   Nonexempt Charitable Trusts
and key employees. For example, if the
organization borrowed $1,000 from one              For this purpose, “gross receipts” are        Section 4947(a)(1) nonexempt charitable
officer and loaned $500 to another, none        the club’s income from its usual activities.     trusts that file Form 990-EZ instead of
of which has been repaid, report $1,500 on      The term includes charges, admissions,           Form 1041 must complete this line. The
line 38b.                                       membership fees, dues, assessments,              trust should include exempt-interest
                                                investment income (such as dividends,            dividends received from a mutual fund or
   For loans outstanding at the end of the                                                       other regulated investment company as
year, attach a schedule as described            rents, and similar receipts), and normal
                                                recurring capital gains on investments.          well as tax-exempt interest received
below. Report any interest expense on line                                                       directly.

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