The IRS doesn’t intentionally craft documents that can make filers look really good, but Form 990, Return of Organization Exempt from Income Tax, has just that potential.
Organizations can use the Form 990’s two-line summary (Line No 1 under Part 1) to toot their horns. As the American Institute of CPAs (AICPA) points out in a blog, the form isn’t just about the numbers.
“Because Form 990 is available to the public, fundraising organizations that view it as merely another compliance requirement are missing a golden opportunity to shine a light on their organization’s accomplishments and attract support for their causes,”
The public sees this information on sites like GuideStar, and GuideStar links up with fundraising sites, such as CrowdRise, Network for Good, and Kimbia, the AICPA notes. That means Form 990 can be seen by local leaders, policymakers, the media, and current and potential donors. So, how that highly visible two-line summary is written can make a big difference.
Kendall Financial Services recommends filing the 990 voluntarily. So, even if an organization doesn’t have to do it, do it anyway. Small groups that might be required to do shorter versions should do the full form. Some groups, such as churches, will file to attract more donations. Grant-seekers will file because grantees may require Form 990 anyway.
Preparing Form 990 is not just about getting all the correct numbers in the right boxes to satisfy the IRS. If you view it that way, you may be missing out on an opportunity to help your organization stand out from the rest.