Nonprofits urge caution in tax-form changes

Several prominent nonprofit-sector groups are urging the IRS to proceed cautiously in its revisions of the information form tax-exempt groups must file with the agency.

The IRS has released a draft of its recommendations for the new Form 990, including identifying groups that are required to file and the types of information they must disclose.

The changes have come under fire from groups representing the nonprofit sector, including advocacy group OMB Watch, trade association Independent Sector, and GuideStar, which provides public information about nonprofits.

The three groups say more time is needed to review and comment on the revised Form 990 to ensure the document is a clear as possible and achieves the desired results.

Additional time before implementation also will give nonprofits enough time to adjust their accounting and record-keeping systems so they can complete the new filing accurately, the groups say.

In addition, OMB Watch says more work is needed on the form to clarify the difference between voter-education activities and lobbying and campaign activities.

Independent Sector recommends the IRS reorganize the Core Form of the filing to highlight groups’ program activities, clarify fundamental financial information and broaden the compensation section.

And GuideStar’s comments urge simplicity in the form, with the goal of collecting usable data in a timely fashion.

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