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Thursday, April 28, 2011

Time to File Not-for-Profit Returns

by Carla Haire, CPA, MT

The filing deadlines have passed for individuals, estates and trusts, and corporations and partnerships using a calendar year. Now it’s time to focus on the not-for-profits. The filing deadline is May 15 for those calendar-year organizations filing Forms 990, 990-EZ, 990-N, or 990-PF. The best way to approach preparing a not-for-profit return is to first determine which form the organization is required to file. It is also beneficial to know the organization’s normal total gross receipts amounts to determine if the income meets the requirement for filing a specific form type. For further guidance, see the IRS page, Form 990 Series – Which Form to File.

Guide to Using Drake for 990 Series Returns
Because not-for-profit returns are often complex, Drake has designed its 990 package to help simplify the process. The guide below is provided to help prevent needless data entry in Drake. (For more information on the screens that are commonly used by all form types, see “Commonly Used Screens” following the bulleted lists below.)

990 Returns
The specified screens under the following tabs can be used, as applicable, to complete a Form 990 return:
·    Form 990/990EZ tab:
o    Screens in the General info for all return types, 990 only, and Electronic Filing sections
o    PRNT screen
·    Schedules A – G tab: All screens necessary to produce the schedules required for the return. Note that almost every Form 990 return must include Schedules A and B.
·    Schedules H - R tab: All screens necessary to produce the schedules required for the return. Note that almost every Form 990 return must include Schedule O.
·        Other Forms tab:
o    Screens 2848 (Power of Attorney), 8821 (Tax Information Authorization), and 8868 (Application for Extension), as applicable
o    Screens relating to Form 4720, in the Return of Certain Excise Taxes section
·    Form 990T tab: Screen 80, if filing Form 8941 (found on the Credits tab)

990-EZ Returns
The specified screens under the following tabs can be used, as applicable, to complete a Form 990-EZ return:
·    Form 990/990EZ tab:
o    Screens in the General info for all return types, 990-EZ only, and Electronic Filing sections
o    PRNT screen
·    Schedules A – G tab: All screens necessary to produce the schedules required for the return. Only the following schedules on this tab apply to the Form 990-EZ:
o    Schedule A
o    Schedule B
o    Schedule C
o    Schedule E
o    Schedule G
·    Schedules H - R tab: All screens necessary to produce the schedules required for the return. Only the following schedules on this tab apply to the Form 990-EZ:
o    Schedule L
o    Schedule N
o    Schedule O
·    Other Forms tab:
o    Screens 2848 (Power of Attorney), 8821 (Tax Information Authorization), and 8868 (Application for Extension), as applicable
o    Screens relating to Form 4720, in the Return of Certain Excise Taxes section
·    Form 990T tab: Screen 80, if filing Form 8941 (found on the Credits tab)

990-PF Returns
The specified screens under the following tabs can be used, as applicable, to complete a Form 990-PF return:
·    Form 990/990EZ tab:
o    Screens in the General info for all return types and Electronic Filing sections
o    PRNT screen
·    Schedules A – G tab: Only the screen for Schedule B applies to Form 990-PF.
·    Form 990PF tab: All applicable screens
·    Other Forms tab:
o    Screens 2848 (Power of Attorney), 8821 (Tax Information Authorization), and 8868 (Application for Extension), as applicable
o    Screens relating to Form 4720, in the Return of Certain Excise Taxes section
·    Form 990T tab: Screen 80, if filing Form 8941 (found on the Credits tab)

990-N (Postcard) Returns
The specified screens under the following tabs can be used, as applicable, to complete a Form 990-N (Postcard) return:
·    Form 990/990EZ tab:
o    Screens in the General info for all return types and Electronic Filing sections; note that only one OFF (Officers, Directors, Employees) screen is necessary.
o    PRNT screen
·    Form 990T tab: Screen 80, if filing Form 8941 (found on the Credits tab)

990-T Returns
The specified screens under the following tabs can be used, as applicable, to complete a Form 990-T return:
·    Form 990/990EZ tab:
o    Screens in the General info for all return types section
o    PRNT screen
·    Form 990T tab: All applicable screens
·    Credits tab: All applicable screens
·    Other Forms tab: All applicable screens

Commonly Used Screens
Throughout the guide above, note that the screens under General info for all return types are used for all form types. Those screens consist of screen 1 (for general information) and two screens for listing officers, directors, employees, and contractors. Another screen that can be used for all form types is the PRNT screen, which contains fields for various print options and overrides. Other commonly used screens are those in the Electronic Filing section, which apply for all e-fileable return types. These include the PIN, EF Selections, and PDF screens.

Data Entry Menu Helps Prevent Errors
As shown in the guide, the tabs of Drake’s Data Entry Menu make it easy to find the screens you’re looking for. In addition, if a screen contains data, the screen name is highlighted on the Data Entry Menu. So, if you’re preparing a Form 990 and notice that several screen links in 990-EZ section are highlighted, you can consider that a “red flag” telling you that the return may include double or needless data entry, which  could prevent expected amounts from being generated on a return. In Drake, you can catch these errors early, saving yourself additional work and frustration later on.
For More Information ...

For more information on using Drake to prepare 990 series returns, check out these resources on the Drake Support site:
·    Drake Software Knowledge Base (Resources > Knowledge Bases)
·    Drake Software Manual Supplement: Charities and Non-Profits (Training Tools > Manuals)
Carla Haire, CPA, MT, is a Tax Analyst with Drake’s federal tax development group, where she specializes in the business tax packages. Before coming to Drake in 2002, she worked in public accounting in south Florida. She and her husband, Wayne, live in Franklin, NC, where they enjoy hiking and spending time with family.