Form 990-N Vs Form 990-EZ: Understanding
the Difference
An Overview of Form 990-N Vs Form 990-EZ:
- Updated October 11, 2023 - 2.00 PM - Admin, Tax990
As a nonprofit organization, you may have to deal with different types of 990 forms every year. However, it is important that you have a clear-cut understanding of each form to fulfill your filing requirements easily and accurately.
Here, you can understand the difference between two of the commonly used forms for nonprofits, Form 990-EZ and Form 990-N.
Table of Contents
What is Form 990-N?
Form 990-N, known as an e-postcard, is submitted by small tax-exempt organizations to meet their annual filing requirements. By filing Form 990-N every year, the organizations can indicate to the IRS that they were operating during the corresponding tax year.
What is Form 990-EZ?
Form 990-EZ, known as Short Form (Return of Organization Exempt from Income Tax), is an IRS form filed by certain tax-exempt entities, nonexempt charitable trusts, and section 527 political organizations to report their financial information, activities, and more to the IRS every year.
Annual submission of Form 990-EZ allows these organizations to maintain their IRS compliance and uphold transparency with both current and prospective donors.
Form 990-N Vs Form 990-EZ: What’s the Difference?
While the purpose of both these forms is almost the same, there are many notable differences between them that you should be aware of. Here are they:
Filing Requirements
One of the major differences between 990-N and 990-EZ is their filing requirements. Form 990-N is for smaller organizations with gross receipts of $50,000 or less, whereas Form 990-EZ is for organizations with gross receipts < $200,000 and assets < $500,000.
It’s important to note that the organizations that are eligible to file Form 990-N can choose to file 990-EZ voluntarily. However, 990-EZ filers cannot choose to file 990-N instead.
Information Reported
Form 990-EZ requires you to report a lot of information, such as revenue, expense, assets, liabilities, activities, program service accomplishments, compensation details, and more. Whereas 990-N just requires you to report the basic information such as name, EIN, address, etc.
Schedules Required
There are 8 Schedules available for Form 990-EZ, and you may be required to include the applicable ones based on the information you report. On the other hand, for Form 990-N, there are no additional Schedules required.
Extension
The deadline for filing 990-EZ can be extended using Form 8868. However, the 990-N deadline
cannot be extended.
Penalties
Failing to file a 990-EZ return on time will lead to penalties of $20/day - $110/day. On the other hand, failing to file 990-N doesn’t lead to any penalties.
Note:
The 990-N filers will still be subjected to automatic revocation upon failure to file for 3 consecutive years.
Here is the summary of differences between Form 990-N and 990-EZ:
Common Use Cases
1. My organization’s gross receipts are less than $50,000. Can I Still File Form 990-EZ instead of 990-N?
Yes, you can! Even if your organization’s gross receipts are less, you can choose to file Form 990-EZ (or Form 990) voluntarily.
2. Can I file both 990-N and 990-EZ?
No! An organization can just file any one of these 990 Forms to meet annual filing requirements.
3. My organization’s gross receipts are $100,000. But assets are greater than $500,000. Can I still file Form 990-EZ?
No! In order to be eligible for filing Form 990-EZ, your organization’s gross receipts should be less than $200,000 (and) assets should be less than $500,000.
In this case, you must file Form 990 to fulfill your annual filing requirements.
4. The gross receipts of my organization are $75,000. Can I File Form 990-N instead of 990-EZ?
No! You cannot file 990-N since your organization’s gross receipts are higher. However, you can choose to file Form 990 instead of 990-EZ voluntarily.
5. The gross receipts of my private foundation are less than $50,000. Can I file Form 990-N?
No! Private foundations are required to file Form 990-PF irrespective of their gross receipts. So, in this case, you must file Form 990-PF to meet your annual filing requirements.
