Organizations serving a religious, educational or scientific function might qualify as a 501(c)3, 527 or 4947(a)1 non-profit. A non-profit serving the public good can achieve tax exemption status from the Internal Revenue Service (IRS). Here is how to view tax returns of a nonprofit online.
"Providing a Public Benefit"
The 501(c)3, 527 and 4947(a)1 designations are listed in the Internal Revenue Code. The 501(c)3 organization is the most common charity designation covering religious, educational and scientific groups who are not allowed to support political candidates. The 527 nonprofit is specifically aimed at political action committees. The 4947(a)1 classification is for a non-exempt charitable trust.
The IRS requires that charitable organizations display their tax records to the public for at least three years. This creates transparency, legitimacy and justification for the tax-exempt status of many of these entities.
Nonprofits with more than $50,000 in gross receipts must file an annual tax return - usually the IRS Form 990 "Return of Organization Exempt from Income Tax" or Form 990EZ. This tax form states in bold in the upper right-hand corner: "Open to Public Inspection." Smaller nonprofits with gross receipts under $50,000 must file a smaller Form 990-N.
You can learn a lot about a nonprofit online. Here are the Form 990 sections:
- Part I is "Summary"
- Part II is "Signature Block"
- Part III is "Statement of Program Service Accomplishments"
- Part IV is "Checklist of Required Schedules"
- Part V is "Statements Regarding Other IRS Filings and Tax Compliance"
- Part VI is "Governance Management and Disclosure"
- Part VII is "Compensation of Officers Directors Trustees Key Employees Highest Compensated Employees and Independent Contractors"
- Part VIII is "Statement of Revenue"
- Part IX is "Statement of Functional Expenses"
- Part X is "Balance Sheet"
- Part XI is "Reconciliation of Net Assets"
- Part XII is "Financial Statements and Reporting"
"Where can I find these tax returns online?"
In order to fulfill the public display requirement, many non-profits place their tax returns right on their websites. You can learn some of the following valuable information from a nonprofit tax return online: name, Employer Identification Number (EIN), address, mission, officers, salaries, grants, revenues and expenses. Watchdog groups will also track nonprofit tax returns.