5 Common Errors to Avoid When Filing Form 990-N

Here, we will look at five common mistakes to avoid when filing Form 990-N. These mistakes can result in the loss of your tax-exempt status, so be aware of them and take precautions to avoid them.

1. Not Filing on Time

The deadline for filing Form 990-N is the 15th day of the fifth month following the end of your organization's tax year. For example, if your tax year ends on December 31, 2023, your Form 990-N will be due on May 15, 2024.

If you file Form 990-N late, you will not face any penalties; however, failing to file your epostcard online for three years in a row may result in the organization losing its tax-exempt status. To maintain the organization's tax-exempt status, filing requirements must be met.

2. No Proper Data Management For Your Financial Records

To run a small nonprofit organization successfully, you do not need to be a tax accountant. There are simple steps you can take throughout the year to improve data management, which will have a significant impact on tax preparation. These steps include:

• Use a CRM system to keep track of all donors and donations.
• Monthly accounting of revenues and expenses.
• Using e-filing software that saves your contact information, including your EIN, in your profile.

Furthermore, it is critical to periodically update your financial policies and procedures over time. As your organization expands and evolves, new financial management solutions may become available.  

3. Failing to Provide Complete Information

Form 990-N is a straightforward form, but it is critical to provide complete information. The form requests basic information about your organization, such as its name, address, and tax ID number. It also requests information about your company's gross receipts and total assets.

If you do not provide all of the requested information, the IRS may reject your form. This could cause delays and penalties.

4. Not Using Correct Tax Filing Software

While there are numerous e-filing solutions available, the best option for small nonprofits is one that is specifically tailored to their needs, such as https://www.tax990.com/.

Tax990, an IRS-approved e-file provider, provides the quickest, safest, and most convenient way to file nonprofit taxes, including the electronic postcard.  

SOC 2 Certified e-file provider; this is a significant distinction in our industry. 

Tax 990 servers are hacker-proof and COMODO-certified.  In essence, we handle the complex tasks for you. Just provide some basic details about your organization, and tax990 will take care of the rest!

5. Not Keeping Copies of Your Filings

It is critical to retain copies of your Form 990-N filings. These copies can be used to prove that you submitted your form correctly and on time.

The IRS can request copies of your filings at any time. Are you concerned about keeping copies of your 990 tax filing records? Tax990 keeps a record of your 990-N data for the upcoming tax years. 

Conclusion

Here are five of the most common mistakes to avoid when filing Form 990-N.  

By avoiding these errors when submitting Form 990-N. This will help ensure that your form is submitted correctly and on time, preventing you from losing your tax-exempt status.

To learn more, Visit https://www.tax990.com/e-postcard-form-990-n/