On Jan. 21, 2012, the IRS released the 2011 Form 990 for exempt organizations, as well as most of the accompanying schedules. The due date for filing the required return for an exempt organization that is on a calendar-year taxable year is May 15, 2012, unless the organization obtains an extension. The Form 990 and instructions reveal several important changes of which exempt organizations should be aware.

The general instructions clarify that governmental units and affiliates of governmental units that are described in Revenue Procedure 95-48, which normally excuses such entities from filing requirements, must file an annual return if they are classified as supporting organizations. Also, a new organization that has not yet filed its Form 1023 or Form 1024 with the IRS must file a Form 990.

In the governance section of the Form 990, Part VI, the instructions state that the organization should report whether the governing body delegated broad authority to an executive or other committee or if any governance decisions are reserved to or subject to approval by other persons. Where Part VI of the Form 990 asks if the organization provided copies of the Form 990 to the members of its governing body before filing, the instructions direct the organization to answer "No" if it merely made the Form 990 available upon request.

The instructions clarify the reporting of compensation for officers, directors, employees, and independent contractors in Part VII and the reporting of uncollectible pledges, refunds of contributions, contributions of facilities and services, and Medicare and Medicaid payments in Part VIII of the Form 990. In Part X, the organization must now report its share of assets in any partnerships as reported on the Schedule K-1 issued by the partnership, rather than by book value.

Schedule H, filed by hospital organizations, also has several major changes. Schedule H now requires the organization to list each of its hospital and nonhospital healthcare facilities, including those operated indirectly through a disregarded entity or a joint venture. The form also now requires a separate set of responses regarding policies and practices for each hospital facility. Schedule H includes the community health needs assessment questions, in Part V lines 1–7, that continue to be optional for any tax year beginning before March 24, 2012. The remaining questions in Part V, however, relating to the hospital organization's financial assistance policy, billing and collections policy, policy relating to emergency care, and policy concerning individuals eligible for financial assistance, must be completed by all hospital organizations. Hospital organizations are also required to attach a copy of their most recent audited financial statements to the Form 990.

Certain schedules have not yet been released in their 2011 format, including Schedule E (Schools), Schedule G (Fundraising or Gaming Activities), Schedule I (Grants and Other Assistance to Organizations, Governments, and Individuals in the U.S.), and Schedule N (Liquidation, Termination, Dissolution, or Major Disposition of Assets). The IRS has also not yet released the 2011 Form 990-EZ or Form 990-T. The IRS notes in the instructions to Form 990, however, that it has created a webpage that will reflect any updates affecting the Form 990, its schedules, and the instructions at www.irs.gov/form990.

The limitations for determining which return an organization is required to file remain the same as for 2010. If an organization has gross receipts that are normally less than $50,000, that organization is eligible to file Form 990-N for its 2011 tax year, although it may choose to file a Form 990 or Form 990-EZ. If an organization has gross receipts normally greater than $50,000 but less than $200,000 and total assets less than $500,000, the organization is eligible to file Form 990-EZ for its 2011 tax year, although it may also choose to file a Form 990. If an organization has gross receipts of $200,000 or more or total assets of $500,000 or more for its 2011 tax year, the organization is required to file a Form 990.

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