What IRS Form 990-T (2015) Is For

Form 990-T (2015) is the Exempt Organization Business Income Tax Return used by tax-exempt organizations to report unrelated business income tax (UBIT) and calculate their tax liability on income not substantially related to their exempt purpose. Organizations must file Form 990-T if they have gross income of $1,000 or more from a regularly conducted unrelated trade or business, with gross income defined as gross receipts minus cost of goods sold (IRS Instructions for Form 990-T (2015)).

When You’d Use Form 990-T for 2015 (Late or Amended Filing)

You would file a late or amended Form 990-T for 2015 in several scenarios: when you receive IRS notices about unfiled returns, discover previously unreported unrelated business income, need to correct errors on an originally filed return, or realize you had a filing obligation you missed. Late filers may face balance due situations with accumulated penalties and interest. For amended returns, you must file within 3 years after the original due date or 3 years after the date you actually filed the original return, whichever is later. Write "Amended Return" at the top and include a statement explaining the changes and reasons (IRS Instructions for Form 990-T (2015)).

Key Rules Specific to 2015

• Section 179D deduction: Extended for energy-efficient commercial buildings placed in service after December 31, 2014.
  
  
• Qualified specified payments: Exclusions under section 512(b)(13)(E)(iv) were extended.
  
  
• American Samoa credit: Extended for taxable years beginning after December 31, 2014 and before January 1, 2017.
  
  
• Health insurance credit: Increased to 35% for tax-exempt small employers using SHOP Marketplace plans.
  
  

Step-by-Step (High Level)

• Gather transcripts and records: Request IRS transcripts and collect documentation of unrelated business income and expenses.
• Complete correct-year form: Use the 2015 Form 990-T and applicable schedules, applying 2015 tax law.
• Attach schedules: Include Schedules A through K as applicable, especially for debt-financed income and controlled organization rules.
• Choose filing method: Mail to IRS Center, Ogden, UT 84201-0027 (e-filing not mandatory in 2015).
• Keep copies: Maintain returns, schedules, and supporting records for at least three years.

Common Mistakes and How to Avoid Them

• Failing to report all activities: Ensure unrelated business activities are properly classified and reported.
  
  
• Incorrect expense allocation: Deduct only directly connected expenses, and allocate reasonably if shared with exempt activities.
  
  
• Ignoring $1,000 threshold: Filing is based on gross income, not net income.
  
  
• Overlooking proxy tax: Even without unrelated business income, lobbying activity may require Form 990-T.
  
  
• NOL errors: Follow pre-2018 NOL rules without the later “siloing” requirements.
  
  
• Public inspection: Section 501(c)(3) organizations must make Form 990-T available for public inspection.
  
  

What Happens After You File

The IRS generally processes Form 990-T within 6–8 weeks, though late or amended returns often take longer. Notices may be issued for missing information or balances due. If payment cannot be made immediately, organizations can request an installment agreement using Form 9465, though penalties and interest will continue to accrue. Penalties include 5% per month for late filing (capped at 25%) and 0.5% per month for late payment (up to 25%). Organizations may appeal IRS determinations through the Appeals Office if they disagree with assessments or penalties (IRS Instructions for Form 990-T (2015)).

FAQs

Can I still file Form 990-T for 2015 even though it’s years late?

Yes, late filing is still possible. The IRS can assess tax indefinitely when no return is filed, so submitting Form 990-T helps limit additional compliance issues. While penalties and interest will have accumulated, filing now demonstrates good faith compliance and prevents further accruals. This is important for avoiding automatic revocation of exempt status.

How are penalties and interest calculated on late-filed Form 990-T returns?

The IRS applies late filing penalties at 5% of unpaid tax per month, up to 25%, with a minimum penalty of $135 if the return is more than 60 days late. Interest on unpaid tax compounds daily based on quarterly IRS rates. This continues until balances are resolved, making prompt filing and payment crucial.

Do I need account transcripts before filing a late 2015 Form 990-T?

While not required, transcripts provide valuable information. They show prior filings, penalties already assessed, and any payments applied. Reviewing transcripts ensures you file correctly, prevents duplication of payments, and helps prepare accurate penalty and interest estimates. This is especially helpful for organizations catching up on multiple years of late filings.

What’s the refund deadline for 2015 Form 990-T claims?

Refund claims for overpaid tax must be filed within three years of the original filing date or two years from when tax was paid, whichever is later. For 2015, most refund deadlines have passed, but exceptions may apply in unique situations. Even if refunds are unavailable, accurate filing helps reduce compliance risks.

Should I also file amended state returns if I’m amending my 2015 Form 990-T?

Yes, in most cases. Many states impose their own unrelated business income taxes and rely on federal Form 990-T for reporting. If you file an amended federal return, states often require amended submissions too. Check with your state tax authority to confirm requirements and deadlines to avoid state-level compliance issues.

Can organizations with only proxy tax liability use simplified filing procedures?

Yes. Organizations filing Form 990-T only to report proxy tax on lobbying can file a simplified return. This typically requires completing the heading, lines 37 and 39, Part IV, the signature block, and attaching a proxy tax computation statement. This option reduces the reporting burden when unrelated business income is not involved.

What if I discover I should have filed Form 990-T for multiple years?

Each tax year must be addressed separately, using the correct year’s form and instructions. The IRS processes each return individually, and penalties and interest are calculated per year. Filing multiple late years together helps restore compliance. Organizations should prioritize timely submission to avoid further penalties and maintain exempt status.

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