Glossary
Compliance & Tax

IRS Form 990

By: Alec Hollingsworth
Updated:  
June 2, 2025

DEFINITION:

IRS Form 990 is an annual IRS return that tax-exempt nonprofits file to report financial and operational information.
IRS Form 990 is an annual tax reporting return that federally tax-exempt organizations, including charities and nonprofits, must file with the Internal Revenue Service (IRS). The form provides detailed information on the organization’s mission, programs, and finances. It includes data on revenue, expenses, assets, liabilities, and key staff compensation. Form 990 is designed to promote transparency and accountability within the nonprofit sector. It is also available to the public, allowing donors, regulators, and other stakeholders to evaluate a nonprofit’s operations and stewardship of funds. Organizations generally must file Form 990 if they have gross receipts of $200,000 or more, or assets worth $500,000 or more at the end of the year.

Key Takeaways

  • Form 990 is required for most tax-exempt nonprofits.
  • It provides financial and operational transparency.
  • Publicly available for donor and regulatory review.
  • Essential for maintaining tax-exempt status.

Why It Matters

Form 990 is crucial for transparency, public trust, and maintaining nonprofit tax-exempt status.

Real World Example

A community food bank with $300,000 in annual donations must file IRS Form 990 at the end of its fiscal year. The finance team uses accounting software to track income and expenses throughout the year. When preparing the Form 990, they summarize revenues from donations and grants, list all expenses, report compensation for key employees, and disclose details about their mission and programs. Filing this form on time ensures their continued tax-exempt status and provides transparency to donors who want to see how funds are spent.

How Aplos Helps

Aplos helps nonprofits streamline their accounting, making it easier to gather the required financial data for IRS Form 990. Users can generate reports and track expenses and revenue in formats that simplify annual tax preparation, reducing errors and ensuring compliance with IRS regulations.
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Frequently Asked Questions

Who needs to file IRS Form 990?

Most federally tax-exempt organizations, including charities and nonprofits with gross receipts over $200,000 or assets over $500,000, must file Form 990 annually.

What happens if a nonprofit does not file Form 990?

Failure to file can result in penalties, loss of tax-exempt status, and decreased public trust due to lack of financial transparency.

Is IRS Form 990 available to the public?

Yes, Form 990 is a public document. Donors, regulators, and the general public can access it to review a nonprofit's financials and operations.

Related Terms

Minister’s Housing Allowance
Grant
Chart of Accounts
Project Tracking
501(c)(3)
Deferred Revenue

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