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Tab 7: IRS Form 990 for Most Recent Two Years

The community foundation submits signed copies of the most recent two years’ IRS Form 990, including all schedules, attachments, and exhibits.

For more information, review Core materials, FAQs and a glossary of important terms

Related Standards

II. Mission, Structure and Governance
II.B    A community foundation is recognized by the Internal Revenue Service (IRS) as tax-exempt under Internal Revenue Code Section 501(c)(3) and organized and operated exclusively for charitable purposes.
II.C    A community foundation meets the public support test set forth in Internal Revenue Code Section 170(b)(1)(A)(vi) as modified by Treasury Regulation Section 170A-9(e)(10).
II.F.4    A community foundation's governing body serves without compensation (exclusive of the chief executive officer).
II.F.5    A community foundation's governing body is not controlled by any other nonprofit organization, or by any single family, business, or governmental entity or any narrow group within the community.
II.F.9    A community foundation's governing body ensures that the community foundation meets all legal requirements.

IV. Stewardship and Accountability
IV.F    A community foundation ensures that the foundation's financial resources are used solely in furtherance of its mission.

View all National Standards

Key Elements

Organization files as a section 501(c)(3) organization. (See line J for Forms 990 prior to 2008 and line I for tax years 2008 and after.)

Organization is not controlled by another group or organization. (See Part VI, line 80 for forms filed for tax years prior to 2008 and Part IV, line 34 and, when applicable, schedule R for tax years 2008 and after)

Organization did not engage in any excess benefit transaction during the covered year. (See Part VI, line 89b for forms filed for tax years prior to 2008 and for tax years 2008 and after, see Part IV line 25a and b Part V, line 9b, and when applicable, Schedule L)

(For forms filed for tax years prior to 2008)

On Schedule A, Part IV, either box 11a or box 11b is checked. (Indicates 509(a)1 designation)

On Schedule A, Part IV–A, line 26(f), public support is at least 33.3%, or if public support is less than 33.3% but greater than 10%, organization must provide documentation that was filed with the IRS demonstrating that the organization satisfies the facts and circumstances test.

(For forms filed for tax years 2008 or later)

On Schedule A, Part I, either box 7 or box 8 is checked.

On Schedule A, Part II, line 16 or 17 indicates that the organization meets the public support test. If the organization is relying on the 10% facts and circumstances test (Line 17), the organization must provide documentation that was filed with the IRS in Schedule A, Part IV, demonstrating that the organization satisfies the facts and circumstances test.

Board serves without compensation (excluding CEO) (See Part V for Forms 990 prior to 2008 and Part VII for tax years 2008 and later)

Organization discloses accurate information about its donor advised funds. Required information includes the number of donor advised funds, the aggregate value of assets held in the funds at the end of the tax year, and aggregate contributions to and grants from donor advised funds (See Schedule D for tax years 2008 and later)

Nothing in the document suggests that resources are being used for any purpose other than to further the mission of the organization.

Organization discloses fundraising expenses (See Form 990, Part IX).

Core Materials
FAQs
Glossary

Required Documents

IRS Form 990 with all schedules, attachments, and exhibits

Why does the submitted IRS Form 990 have to be signed?

If the examples in your record book do not have signatures, the reviewer cannot be certain that they are copies of the forms filed with the IRS. Under the public disclosure rules that apply to all charities, a community foundation is required to make a copy of Form 990 available to the general public for inspection either on the internet or as hard copies mailed out upon request. The regulations state that the copy must be "an exact copy of any return filed." If you post a copy on the internet, the regulations further clarify that the online version must "exactly reproduce the image of the annual information return as it was originally filed with the Internal Revenue Service." If you cannot find a signed copy of your Form 990 in your files, you can request one from the IRS.

How can I provide the information on Schedule B without violating the foundation's confidentiality policy?

While Schedule B contains information that can be important for purposes of confirming compliance with the National Standards, we recognize that providing donor names and addresses on Schedule B may, in some cases, violate a foundation's confidentiality policy. If you determine this to be the case, your foundation may choose to submit a redacted version of Schedule B. Consistent with federal law, only names and addresses of donors and any other information that clearly identifies the donor may be redacted. All other information, including the amount of contributions and the description of non-cash contributions, must be visible. Please note that this is the same information that your community foundation is required to make publicly available upon request under the public disclosure rules. (See instructions at the end of Schedule B for information about public inspection.)

Do reviewers only look at the IRS Form 990 line numbers indicated in the key elements for Tab 3?

No. Reviewers review the entire form as part of the record book review and may ask questions about other portions of the form 990 if the information raises questions about any of the National Standards.

With regard to key element 2, our organization is related to another organization within the meaning of Part VI, line 80 (Forms 990 prior to 2008) or Schedule R (Forms 990 after 2008) but we are not controlled by any of the related organizations. What information should we submit to show that our organization is not controlled by the related organizations listed on the Form 990?

If the Form 990 or other materials submitted by the foundation do not already explain the relationship between the community foundation and those entities listed on the Form 990, Part VI, line 80 (Forms 990 prior to 2008) or Form 990, Schedule R (Forms 990 after 2008), submit a narrative that describes the relationship. For example, if one of the listed entities is a Section 509(a)(3) supporting organization of the community foundation, include that information in a narrative under Tab 7 of your record book.

How many years of IRS Form 990 must be submitted?

For confirmation, the two most recent IRS Form 990s must be submitted. For reconfirmation only the most recent IRS Form 990 must be submitted.

170(b)(1)(A)(vi)
An IRS designation indicating that the organization qualifies as a public charity because it meets a public support test.

501(c)(3)
The Internal Revenue Service code section for an organization that is a charitable and tax-exempt organization. This includes both private foundations and public charities.

509(a)(1)
The Internal Revenue Service code section for a Section 501(c)(3) public charity. Section 509(a)(1) organizations include, but are not limited to, religious organizations, schools, hospitals and publicly supported organizations.

Advance ruling letter
The IRS ruling provided to new organizations seeking public charity status as a publicly supported organization indicating that the IRS has agreed to treat the organization as a public charity for an initial five year period while giving the organization a chance to raise enough public support to show that it is, in fact, publicly supported. The IRS stopped issuing advance letter rulings in 2008. Temporary regulations, which are currently in effect, state that any IRS determination letter that contains an expiration date of June 9, 2008, or later should be treated as a permanent ruling.

Employer Identification Number
An Employer Identification Number (EIN) is also known as a Federal Tax Identification Number, and is used to identify a business entity.

Private foundation
A nongovernmental, nonprofit organization with funds (usually from a single source, such as an individual, family or corporation) and program managed by its own trustees or directors, established to maintain or aid social, educational, religious or other charitable activities serving the common welfare, primarily through grantmaking. U.S. private foundations are tax-exempt under Section 501(c)(3) of the Internal Revenue Code and are classified by the IRS as a private foundation as defined in the code.

Public support test
There are two public support tests, both of which are designed to ensure that a charitable organization is responsive to the general public rather than a limited number of persons. One test, sometimes referred to as 509(a)(1) or 170(b)(1)(A)(vi) for the sections of the Internal Revenue Code where it is found, is for charities like community foundations that mainly rely on gifts, grant, and contributions. To be automatically classed as a public charity under this test, organizations must show that they normally receive at least one-third of their support from the general public (including government agencies and foundations). However, an organization that fails the automatic test still may qualify as a public charity if its public support equals at least 10 percent of all support and it also has a variety of other characteristics-such as a broad-based board-that make it sufficiently "public." The second test, sometimes referred to as the section 509(a)(2) test, applies to charities, such as symphony orchestras or theater groups, that get a substantial part of their income from the sale of services that further their mission, such as the sale of tickets to performances. These charities must pass a one-third/one-third test. That is, they must demonstrate that their sales and contributions normally add up to at least one third of their financial support, but their income from investments and unrelated business activities does not exceed one-third of support.

Tax-exempt
General term for an organization that does not have to pay taxes such as federal or state income tax or state sales tax. The rules for tax exemption vary depending on the type of tax and location.

Reconfirming?

Review all key elements and consider if your organization has made changes to your policies, powers or practices.

Pay special attention to key elements and core materials marked with and a . These represent minimum requirements for reconfirmation as well as Pension Protection Act requirements. Items marked with a are particularly critical for those who submitted record books prior to January 2007.