Tax 990

Nonprofit Tax Filing for Credit Counseling Organizations

An overview of applying for tax-exempt status, 990 filing requirements, and IRS deadline.

What Should Credit Counseling Organizations Know About Form 990 Filing?

- Updated August 14, 2023 - 2.00 PM - Admin, Tax990

The IRS has established different IRC sections for the purpose of providing federal tax exemption to nonprofit organizations. Based on their type and how they operate, the nonprofits are granted tax-exempt status under the corresponding IRC section.

This article elaborates on how Credit Counseling Organizations can obtain tax exemption, what their filing requirements for 990 are, and more.

How Does the IRS Define Credit Counseling Organizations?

Per the IRS, Credit Counseling Organizations are established and operated with the primary purpose of providing credit counseling services tailored to the specific needs and circumstances of the consumers.

Primary activities may include educating consumers on:

  • Better money management techniques
  • Debt reduction strategies
  • Avoiding bankruptcy and its financial consequences

How Can Credit Counseling Organizations Apply for
Tax Exemption?

The IRC Section 501(q) provides Credit Counseling Organizations with the option to apply for federal tax exemption under either the IRC Section 501(c)(3) or 501(c)(4).

Organizations seeking exemption under IRC Section 501(c)(3) must file Form 1023 (or) Form 1023-EZ.

Organizations seeking exemption under IRC Section 501(c)(4) must file Form 1024-A.

In addition to Section 501(c)(3) or 501(c)(4) requirements, Credit Counseling Organizations must meet certain other requirements in order to be eligible for tax-exempt status. For more information, visit here.

What are the 990 filing Requirements for Credit Counseling Organizations?

The Credit Counseling Organizations that obtained federal tax exemption aren’t required to pay federal
income taxes.

However, they still have the responsibility of completing their annual tax filing to report their financial information, activities, and certain other details required by the IRS. They must file their 990 electronically Return of Organization Exempt From Income Tax, for this purpose.

Additional Filing Requirements

Based on the answers provided by the Credit Counseling Organizations on their 990 forms, they may be required to include certain Schedules.

If the Credit Counseling Organization that files a 990 return has an unrelated business income of $1000 or more, they must file Form 990-T.

When is the Form 990 Deadline for Credit Counseling Organizations?

Generally, the Credit Counseling Organizations that obtained federal tax-exempt status must file Form 990 by the 15th day of the 5th month following the end of their accounting period.

So, if a Credit Counseling Organization follows the calendar tax year, the deadline to file Form 990 is May 15th.

If this deadline falls on a weekend or holiday, then the 990 return must be filed by the next business day.

Operating on a Fiscal Tax Year? Find your 990 deadline using our due date calculator.

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Tax 990, the IRS-authorized e-file provider, offers the easiest way of filing 990 forms for Credit Counseling Organizations and other tax-exempt organizations. Some of the helpful features offered by
Tax990 are as follows,

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