In which cases might a nonprofit file Form 990-EZ or Form 990-N instead of the standard Form 990?

In which cases might a nonprofit file Form 990-EZ or Form 990-N instead of the standard Form 990?

• A. Large organizations with multiple programs.
• B. Entities that file at the state level rather than IRS.
• C. Organizations with unrelated business income over threshold.
• D. Smaller organizations with simpler financial activity.

Answer: (D)

Smaller nonprofit organizations with simple financial activity are eligible for the shorter filing options because the IRS tails the form to the size and complexity of the organization. If an nonprofit’s gross receipts are normally $50,000 or less, it can file Form 990-N (the e-Postcard), which requires far less information. If receipts are a bit higher but still modest and the organization’s assets are under certain limits, Form 990-EZ is available as a simplified alternative to the full Form 990. When an organization is larger or has more complex finances (such as multiple programs, significant assets, or substantial unrelated business income), the full Form 990 is required. So the choice to use the shorter forms hinges on being small and simple, which is why smaller organizations with straightforward finances fit this option.

Smaller nonprofit organizations with simple financial activity are eligible for the shorter filing options because the IRS tails the form to the size and complexity of the organization. If an nonprofit’s gross receipts are normally $50,000 or less, it can file Form 990-N (the e-Postcard), which requires far less information. If receipts are a bit higher but still modest and the organization’s assets are under certain limits, Form 990-EZ is available as a simplified alternative to the full Form 990. When an organization is larger or has more complex finances (such as multiple programs, significant assets, or substantial unrelated business income), the full Form 990 is required. So the choice to use the shorter forms hinges on being small and simple, which is why smaller organizations with straightforward finances fit this option.