Four Steps to Make 990 Extensions Work for Your Nonprofit

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Posted on November 7, 2017 by Harbor Compliance in Nonprofit Compliance.


November is a big month for renewing charitable solicitation registrations. If your fiscal year ends June 30, your IRS Form 990 is due November 15, along with renewals in 13 states. If you’re on a calendar year, and you’ve taken the maximum 990 extensions, you’re also facing a lot of requirements this month, some of which you may not have seen coming. In fact, many nonprofits take the 990 extensions without realizing the conflicts that can arise with state fundraising requirements. This is a good time of year to look at some of the challenges 990 extensions can pose for your nonprofit and lay out a strategy that won’t leave you scrambling come next November.

Form 990 Requirements

IRS Form 990s are due four months and 15 days after the close of a nonprofit’s fiscal year. For nonprofits on a calendar tax year, this means that IRS Form 990s are due May 15. Charities whose 990s aren’t ready by tax time often request a three-month extension using IRS Form 8868. Others go on to refile for another three-month extension, the maximum allowed, through November 15. While this provides more time to prepare and file the tax return, it can present challenges in keeping your state fundraising registrations up to date.

The Problem

State charitable solicitation registration renewals require information that can only be found on the 990, so they can’t be completed until the 990 has been filed. There are also several states that require charities to attach the filed 990 to their registration renewal packet. That makes it impossible to submit an application before your federal tax return has been prepared.

As a result, the charity must file extensions with each of the states where a renewal is required. That approach can work when the organization files the 990 relatively quickly. Problems arise when charities delay their 990 filing later into the IRS extension period, because some states simply won’t extend their deadlines that far. When the 990 is filed on the last possible day, attaching that approved document to renewal applications in all of the states where it is required becomes a massive logistical challenge.

Fortunately, we manage massive logistical challenges daily, so if you’re up against some tight deadlines, we can help. Meanwhile, here are a few tips for making next year a bit easier on you and your staff:

Four Steps for Stress-Free 990 Extensions

  1. Know the charitable solicitation registration deadlines and renewal requirements in all of the states where you solicit funds.
  2. Lay out a strategy that gives you as much time as possible to file your 990 while meeting fundraising registration deadlines.
  3. Plan ahead for any required renewals, and file them along with your Form 8868 extensions.
  4. Partner with a compliance solutions provider that can turn around the renewal applications as quickly as possible following filing of your 990.

Compliance Is Easy

Keeping state fundraising registrations current provides many advantages for your nonprofit. It allows you to reach out to more donors. It lets you demonstrate responsible governance and good standing with charity regulators. It encourages donations from savvy donors who do their research before writing checks.

At Harbor Compliance, we pride ourselves on making compliance easy and affordable for nonprofits of all sizes. We take all of the details of charitable solicitation registration off your plate so you can focus on your mission.

Talk to a specialist about your compliance roadmap today. Call 1-888-995-5895.