Who Needs to File the 990-N? Understanding Requirements & Eligibility

As a small nonprofit, you may have heard of IRS Form 990-N, also known as the e-Postcard. But how do you know if your organization actually qualifies to file the most simplified version of Form 990?

Like anything involving the IRS, eligibility rules can feel overwhelming. But making guesses can put your organization’s tax-exempt status at risk, so it’s important to get the facts straight. 

In this post, we’ll break down the requirements (especially the under-$50,000 gross receipts threshold) and explain who is (and isn’t) eligible to file Form 990-N. 

What is Form 990-N?

Before diving into eligibility, let’s take a quick step back to define what IRS Form 990-N is.

Form 990-N, often called the e-Postcard, is the simplest annual information return that certain small, tax-exempt organizations can file with the IRS. Although eligible organizations typically don’t have to pay federal income taxes, they must file Form 990-N annually to report basic information on their activities from the previous year and maintain their tax-exempt status. 

Form 990-N is due by the 15th day of the fifth month after the end of your organization’s tax year. It can only be filed online; there’s no paper version available. 

Next up, we’ll take a closer look at who exactly is eligible.

The $50,000 gross receipts threshold explained

As a general rule, small tax-exempt organizations are eligible to file the 990-N if their annual gross receipts are normally $50,000 or less. There are a few exceptions to this rule, which we’ll discuss later on. 

But what exactly are “gross receipts?” 

Gross receipts include all income your nonprofit receives, not just donations. This might include:

• Contributions and grants
• Fundraising revenue
• Membership dues
• Program service income
• Any other sources of revenue

It might seem odd that the IRS uses the phrase “normally” when defining eligibility, but it’s intentional. That’s because  eligibility isn’t based on a single year alone.

For established organizations, “normally” means the nonprofit’s average gross receipts over the past three years are $50,000 or less, including the year currently being calculated. For example, if an established PTA reported $48,000, $52,000, and $46,000 in gross receipts over the past three years, its three-year average would still be under $50,000. That means it would generally qualify to file Form 990-N. 

For newer organizations, eligibility is a little bit different. 

Organizations that have existed for one to two years are eligible if their average annual gross receipts are $60,000 or less. Organizations that have existed for a year or less are eligible if their gross receipts are $75,000 or less. 

If your organization exceeds these thresholds, you might still be tax-exempt, but you’re not eligible to file Form 990-N. Instead, you’ll need to file a different return, such as Form 990-EZ or Form 990.

What groups are eligible to file Form 990-N?

Meeting the $50,000 gross receipts threshold is the primary factor in determining eligibility. However, there are a few other requirements your organization must meet to file Form 990-N. 

#1 Your organization must be recognized by the IRS as tax-exempt

This typically includes small 501(c)(3) organizations such as community groups, PTAs, PTOs, booster clubs, and other volunteer-run nonprofits. 

#2 Your organization must be required to file an annual information return

Form 990-N satisfies this requirement for eligible small nonprofits.

#3 Your organization must be active

Even if your organization had little or no financial activity during the year, you’re generally still required to file annually to maintain your tax-exempt status.

If your organization meets the gross receipts requirements and checks all of the boxes above, Form 990-N is likely the correct return to file. 

What groups can’t file Form 990-N?

Most organizations with gross receipts under $50,000 are eligible to file the 990-N, but there are some exceptions. Your organization isn’t eligible to file the e-Postcard if any of the following apply:

• Your gross receipts exceed the eligibility threshold: If your gross receipts are above the limits explained earlier, you must file either Form 990 or Form 990-EZ instead. 
• Your organization is a private foundation: These groups are required to file Form 990-PF, regardless of income level.
• Your organization is a supporting organization: If your organization supports other exempt organizations, you typically need to file Form 990 or Form 990-EZ. 
• Your organization has lost or not yet received tax-exempt status: If your status has been revoked or you haven’t yet been recognized as tax-exempt by the IRS, you’re not eligible to file Form 990-N. 
• Your organization is required to file a different type of return: Certain groups like trusts, political organizations, and other specialized entities have different filing requirements. 

If your organization falls into one of these categories, you likely still need to file an annual return. But you’re not eligible to file Form 990-N. 

Know your numbers to protect your tax exempt status

As a small nonprofit, you’re always juggling a million things. But tax filing requirements are one thing you can’t afford to ignore. 

Fortunately, Form 990-N makes it easy to meet the IRS’s annual filing requirement.  If your organization is tax-exempt, active, and has gross receipts that are normally under $50,000, filing the e-Postcard is all that’s required to stay in good standing.

Form 990-N is due by the 15th day of the fifth month after the end of your organization’s tax year. Filing on time helps protect your tax-exempt status and avoid unnecessary issues with the IRS.
Form 990-N is relatively simple to file. But as a busy volunteer, you may not have the time to figure it all out. 501c3 Center is here to help you navigate the e-Postcard so you can stay focused on your organization’s mission. Learn more and file your 990-N today – no IRS account required.