What Is the Filing Threshold for Form 990-N?
Understand the financial and eligibility rules for the Form 990-N e-Postcard, the simple annual notice required for small nonprofits to maintain IRS compliance.
Form 990-N, also known as the e-Postcard, is an annual information return filed with the Internal Revenue Service (IRS) by certain small tax-exempt organizations. It provides a simplified method for these organizations to satisfy their yearly reporting requirement and maintain their tax-exempt status. The filing is a straightforward process that confirms the organization is still active and provides the IRS with basic operational information.
Determining Filing Eligibility
To be eligible to file Form 990-N, an organization’s annual gross receipts must be $50,000 or less. The IRS defines “gross receipts” as the total income an organization receives from all sources during its annual accounting period, before subtracting any costs or expenses. This includes revenue from donations, grants, membership dues, program service fees, investment income, and sales of merchandise.
The IRS uses a specific formula to define the $50,000 threshold based on the organization’s age. An organization in its first year qualifies if it received $75,000 or less. An organization operating for one to three years qualifies if it averaged $60,000 or less in gross receipts during its first two tax years. For organizations three years or older, the threshold is met if the average gross receipts for the three preceding tax years is $50,000 or less.
Even if an organization meets the gross receipts test, certain types are ineligible to file the e-Postcard. Private foundations must file Form 990-PF regardless of their income. Most Section 509(a)(3) supporting organizations, Section 527 political organizations, U.S. government instrumentalities under Section 501(c)(1), and certain trusts are also excluded and must file more detailed forms.
Information Required for the e-Postcard
An organization must gather eight pieces of information before filing. This includes the organization’s Employer Identification Number (EIN), its legal name as registered with the IRS, and any “doing business as” (DBA) names it uses.
Filers will also need the organization’s current mailing address, the name and address of a principal officer, and the organization’s tax year. The submission requires confirmation that annual gross receipts are not more than $50,000. Finally, the organization must provide its website address if one exists and state if it is terminating its operations.
The e-Postcard Filing Process
Filing Form 990-N is an electronic process, as no paper forms are available. An organization must access the submission page through the official IRS website. On the portal, the user will enter the required information, such as the EIN and legal name.
The deadline for submitting the e-Postcard is the 15th day of the 5th month after the organization’s accounting period ends; for calendar-year filers, this is May 15th. An extension of time to file Form 990-N cannot be requested. There is no monetary penalty for filing the e-Postcard late, but failing to file altogether has significant consequences.
Failure to file Form 990-N for three consecutive years results in the automatic revocation of an organization’s tax-exempt status. This means the organization would be subject to income tax, and its donors would lose the ability to make tax-deductible contributions. The IRS publicly lists organizations whose status has been revoked.