Form 990 Board Approval Process

Steve Miller, commissioner of tax-exempt and government entities at the Internal Revenue Service (IRS) stated that the “service is going to be involved with governance.” The IRS encourages an active and engaged board and believes that it is “important to the success of a charity and to its compliance with applicable tax law requirements.”

Part VI of the IRS Form 990, Section A, Question 10 asks, “Was a copy of the Form 990 provided to the organization’s governing body before it was filed? All organizations must describe in Schedule O the process, if any, the organization uses to review the Form 990.” There is no existing legal requirement to provide board members with the IRS Form 990. This question relates to how an organization’s governing body reviews the 990.

As organizational practices differ regarding internal review by board and management officials, the IRS Form 990 instructions indicate that an organization should describe in Schedule O:

  • The process by which the organization’s officers, directors, trustees, board committee members or management reviewed the prepared IRS Form 990;
  • Whether the review occurred before or after it was filed with the IRS; and
  • The specifics regarding who conducted the review, when it was conducted, and the extent of such a review.

Boards should consider adopting an IRS Form 990 review policy that provides adequate time for meaningful review by at least a subcommittee of the board and a method for allowing feedback and revisions based on board input.

Process Tips

  •  Copy of the IRS Form 990 should be provided to the board prior to filing (hard copy or electronic).
  • Actual review and discussion should be made by the committee or full board, facilitated perhaps by the finance director, audit committee chair and/or 990 preparer.
  • Documentation of the review made in meeting minutes.
     
 
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