Form 990 for New Nonprofits: What to Know Before Your First Filing
You've incorporated your nonprofit and received your 501(c)(3) determination letter. Now comes the most important ongoing obligation: filing Form 990 with the IRS every year.
Miss it three times in a row and you automatically lose your tax-exempt status. No warning. No appeal. This guide covers which form to file, when it's due, what information you need, how to prepare, the extension process, and how to avoid the most common mistakes.
Which Form 990 Do You File?
The IRS has three versions of Form 990. Which one you file depends on your gross receipts and total assets:
| Your Gross Receipts | Your Total Assets | Form to File | Complexity |
|---|---|---|---|
| Under $50,000 | Any amount | Form 990-N (e-Postcard) | 5 minutes online |
| $50,000 – $200,000 | Under $500,000 | Form 990-EZ | 4-6 pages |
| Over $200,000 | Over $500,000 | Form 990 (full) | 12+ pages + schedules |
Note: If you meet either the gross receipts or total assets threshold for a higher form, you must file that form. For example, if your gross receipts are $40,000 but your assets are $600,000, you file the full Form 990.
Most new nonprofits file Form 990-N for the first 1-3 years while they're building their donor base and programs.
Form 990-N (e-Postcard)
The simplest option. Filed electronically through the IRS website. It asks for:
- EIN
- Tax year
- Legal name and mailing address
- Name and address of a principal officer
- Website URL (if any)
- Confirmation that gross receipts are normally $50,000 or less
- Whether the organization has terminated or gone out of business
That's it. Five minutes, no financial statements, no narrative descriptions, no schedules.
File at: IRS.gov Form 990-N Electronic Filing System
Form 990-EZ
A mid-complexity return for organizations with gross receipts between $50,000 and $200,000. It includes:
- Revenue and expense summary
- Balance sheet (beginning and end of year)
- List of officers, directors, and key employees with compensation
- Program service accomplishments (narrative description of your 3 largest programs)
- Other information (lobbying, political activity, donor-advised funds, etc.)
Key schedules that may be required:
- Schedule A — Public Charity Status (required for all 501(c)(3) organizations)
- Schedule B — Contributors (if you received $5,000+ from any single donor)
- Schedule O — Supplemental information (additional space for narrative answers)
Form 990 (Full)
The comprehensive annual return for larger organizations. In addition to everything in the 990-EZ, it includes:
- Detailed functional expense allocation (program, management, fundraising)
- Statement of revenue by source
- Detailed balance sheet
- Governance and management questions
- Compensation disclosure for officers and highest-paid employees
- Independent contractor disclosure
- Financial statements and reporting
Additional schedules (as applicable):
- Schedule D — Supplemental Financial Statements
- Schedule G — Fundraising events and gaming
- Schedule J — Compensation Information
- Schedule M — Non-cash contributions
- Schedule R — Related organizations
When Is Form 990 Due?
Form 990 is due on the 15th day of the 5th month after your fiscal year ends.
| Fiscal Year End | Form 990 Due | Extension Due |
|---|---|---|
| December 31 | May 15 | November 15 |
| March 31 | August 15 | February 15 |
| June 30 | November 15 | May 15 |
| September 30 | February 15 | August 15 |
Most nonprofits use a calendar year (January-December), making the deadline May 15 every year.
Your First Filing Year
Your first fiscal year may be a short year. For example, if you incorporated on August 15 and chose a calendar fiscal year, your first fiscal year is August 15 – December 31. Your first Form 990 covers only those 4.5 months and is due May 15 of the following year.
Extensions
You can request a 6-month automatic extension by filing Form 8868 before the original due date.
| Detail | Info |
|---|---|
| Form | Form 8868 |
| Cost | Free |
| Filed | Electronically or by mail |
| Extension length | 6 months |
| Deadline | Must be filed before the original Form 990 due date |
| Approval | Automatic — you don't need a reason |
Important: The extension gives you more time to file, not more time to pay. If your organization owes any unrelated business income tax (UBIT), you must pay by the original due date.
The Three-Year Automatic Revocation Rule
This is the single most important thing to understand about Form 990:
If your nonprofit fails to file Form 990 (any version — including the simple 990-N e-Postcard) for three consecutive years, the IRS automatically revokes your tax-exempt status.
- No warning letter
- No grace period
- No appeal process
- It's automatic — the IRS doesn't exercise discretion
What Happens After Automatic Revocation
| Consequence | Impact |
|---|---|
| Loss of tax-exempt status | Effective on the filing due date of the third missed return |
| Donors can't deduct | Donations made after revocation are not tax-deductible |
| Income becomes taxable | The organization must file Form 1120 and pay corporate income tax |
| IRS publishes revocation | Your organization appears on the IRS Auto-Revocation List |
| Grants dry up | Funders check tax-exempt status before making grants |
How to Get Reinstated
Reinstatement requires:
- Filing a new Form 1023 or 1023-EZ with the full filing fee ($275 or $600)
- Filing all back Form 990s for the missed years
- Paying any applicable taxes and penalties
- Waiting for IRS processing (2-4 weeks for 1023-EZ, 3-6 months for full 1023)
Retroactive reinstatement (backdating to the revocation date) is possible if you can show reasonable cause for the missed filings, but it's not guaranteed.
Prevention is much easier than reinstatement. Set a calendar reminder, use accounting software that alerts you, and file the Form 990-N e-Postcard even if you had zero activity — it takes 5 minutes.
What Information Do You Need to File?
For Form 990-N (e-Postcard)
Minimal — just basic organizational information. No financial data required.
For Form 990-EZ and Full Form 990
You'll need a full year's worth of organized financial records:
Revenue:
- Total donations and contributions (by source)
- Grant income
- Program service revenue (fees for services)
- Fundraising event income (gross and net)
- Investment income
- Other revenue
Expenses:
- Salaries and benefits
- Professional fees (accounting, legal, consulting)
- Occupancy costs (rent, utilities, insurance)
- Travel and conferences
- Printing, postage, and publications
- Program expenses (by program)
- Administrative and fundraising expenses
Balance Sheet:
- Cash and savings
- Accounts receivable
- Prepaid expenses
- Fixed assets (equipment, furniture)
- Accounts payable
- Grants payable
- Net assets (unrestricted, temporarily restricted, permanently restricted)
Governance:
- Number of voting board members
- Number of independent board members
- Whether you have a conflict of interest policy
- Whether the board reviews the Form 990 before filing
- CEO/ED compensation and process for setting it
Program Accomplishments:
- Description of your 3 largest programs
- Expenses for each program
- Number of people served or other measurable outcomes
How Fund Accounting Helps
Proper fund accounting from day one makes Form 990 preparation dramatically easier. With Alignmint's fund accounting:
- Revenue and expenses are already categorized by fund and program
- Restricted funds are tracked separately (required for Form 990 reporting)
- Functional expense allocation is automated
- Balance sheet data is always current
- Board reports double as 990 preparation worksheets
How to Prepare Your First Form 990
Step 1: Determine Which Form
Use the gross receipts and assets table above. If you're unsure, start by calculating your total revenue for the year.
Step 2: Gather Your Records
Collect all financial records for the fiscal year:
- Bank statements (every month)
- Donation records (every gift, with donor info for gifts over $250)
- Expense receipts and invoices
- Payroll records (if applicable)
- Grant agreements and payments
- Board meeting minutes
- Governance policies (conflict of interest, compensation procedures)
Step 3: File the Return
| Form | How to File | Where |
|---|---|---|
| 990-N | Online only | IRS.gov |
| 990-EZ | Electronically (required for tax years beginning after July 2019) | Through an IRS-approved e-file provider |
| 990 (full) | Electronically (required) | Through an IRS-approved e-file provider |
All tax-exempt organizations must e-file their Form 990 or 990-EZ (as of tax years beginning after July 1, 2019). Paper filing is no longer accepted for these forms.
Step 4: Board Review
Best practice: Have the board review and approve the Form 990 before filing. The Form 990 asks whether the board reviewed it — answering "yes" demonstrates good governance.
Step 5: Make It Public
Form 990 is a public document. You must provide a copy to anyone who requests it in person (same day) or in writing (within 30 days). Most organizations simply post it on their website or through GuideStar/Candid.
Common Mistakes for New Nonprofits
- Not filing at all — "We had no activity this year" is not an excuse. File the 990-N e-Postcard even with zero revenue.
- Filing the wrong version — Check your gross receipts and assets carefully. Filing the wrong form triggers IRS follow-up.
- Missing the deadline — Set calendar reminders for your filing deadline AND the extension deadline.
- Not including Schedule A — All 501(c)(3) organizations must include Schedule A (Public Charity Status) with their 990-EZ or full 990.
- Inconsistent numbers — Revenue on your Form 990 should match your bank records and donor management system.
- Forgetting state filings — Form 990 is federal. Many states also require separate annual filings or use the Form 990 as part of their charitable solicitation renewal.
- Not tracking functional expenses — The full Form 990 requires you to allocate expenses into program, management/general, and fundraising categories. Set this up in your accounting from day one.
Form 990 Filing Calendar for Calendar-Year Nonprofits
| Date | Action |
|---|---|
| January 1 | New fiscal year begins |
| January 31 | Issue W-2s to employees, 1099s to contractors |
| March 15 | Good time to start preparing Form 990 |
| April 15 | Begin gathering governance documents (conflict of interest policy, board roster) |
| May 1 | Final push to complete Form 990 preparation |
| May 15 | Form 990 due (or Form 8868 extension must be filed) |
| November 15 | Extended Form 990 due (if extension filed) |
| December 31 | Fiscal year ends; begin collecting records |
Form 990 vs. Other IRS Filings
| Filing | Who Files | When | Cost |
|---|---|---|---|
| Form 990/990-EZ/990-N | All 501(c)(3) organizations | Annually | Free |
| Form 990-T | Organizations with unrelated business income over $1,000 | Annually | Tax owed on UBIT |
| Form 1099 | Organizations that paid $600+ to contractors | January 31 | Free |
| Form W-2 | Organizations with employees | January 31 | Free |
| Form 8868 | Organizations requesting a filing extension | Before 990 due date | Free |
| State returns | Varies by state | Varies | Varies |
Set up your accounting from day one with fund accounting software that generates 990-ready reports. Alignmint is free for nonprofits under $100K in annual donations — including functional expense allocation, restricted fund tracking, and board-ready financial reports.
For the full startup process, see How to Start a Nonprofit or use our Nonprofit Startup Checklist.
Ready to set up your new nonprofit? Schedule Your Free Setup | Start Free — Under $100K in Donations
Related:
Ready to see how Alignmint works for your nonprofit?
Schedule a free walkthrough — we'll set everything up for you.