Understanding the 990-E Form
Are you a non-profit organization looking to file for an extension on your 990-E form? Filing for an extension can be a crucial step in ensuring that your organization has enough time to accurately complete its tax return. In this detailed guide, we will explore the ins and outs of filing for an extension on your 990-E form, providing you with the information you need to make an informed decision.
What is the 990-E Form?
The 990-E form, officially known as the “Return of Exempt Organization,” is a tax form required to be filed by tax-exempt organizations in the United States. This form is used to report the organization’s financial activities, governance, and other relevant information to the IRS. It is important to note that the 990-E form is not a tax return, but rather a report of the organization’s activities during the tax year.
When to File for an Extension
There are several reasons why a non-profit organization might need to file for an extension on their 990-E form. Some common reasons include:
- Complex financial situations that require additional time to resolve
- Difficulty in gathering the necessary information from board members or other stakeholders
- Unforeseen circumstances that have impacted the organization’s ability to file on time
It is important to remember that filing for an extension is not a way to avoid penalties or interest, but rather a means to provide additional time to complete the form accurately.
How to File for an Extension
Filing for an extension on your 990-E form is a straightforward process. Here are the steps you need to follow:
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Complete Form 8868, “Application for Extension of Time to File an Exempt Organization Return.” This form can be found on the IRS website.
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Submit Form 8868 to the IRS by the original filing deadline for your 990-E form. This will grant you an automatic six-month extension.
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Once you have received confirmation of the extension, you can begin working on your 990-E form. Be sure to complete it accurately and submit it by the extended deadline.
It is important to note that while Form 8868 is free, there is a $220 fee for each month or part of a month that the extension is granted, up to a maximum of five months. This fee is due when you file your 990-E form.
Penalties for Late Filings
While filing for an extension can provide additional time to complete your 990-E form, it is important to be aware of the penalties for late filings. If you fail to file your 990-E form by the extended deadline, you may be subject to penalties and interest. The penalties vary depending on the type of organization and the reason for the late filing.
Type of Organization | Reason for Late Filing | Penalty |
---|---|---|
Small Organizations | Failure to file | $50 per month, up to a maximum of $250 |
Large Organizations | Failure to file | $100 per month, up to a maximum of $500 |
Small Organizations | Failure to file | $50 per month, up to a maximum of $250 |
Large Organizations | Failure to file | $100 per month, up to a maximum of $500 |
Conclusion
Filing for an extension on your 990-E form can be a valuable tool for non-profit organizations that need additional time to complete their tax return. By understanding the process and the potential penalties for late filings, you can make an informed decision that will benefit your organization. Be sure to follow the steps outlined in this guide to ensure a smooth and successful filing process.