2019 Form 990 Compliance Checklist: Tax-Year Accurate
Why 2019 Form 990 Is Distinct
The 2019 Form 990 introduces mandatory compliance with Section 4960 excise tax reporting for excess remuneration exceeding $1,000,000, requiring concurrent filing of Form 4720 Schedule N. Organizations must report under FASB ASU 2016-14 net asset reclassification, and all filers submit Schedule O.
Electronic filing becomes compulsory for tax years beginning on or after July 2, 2019—affecting many 2020 filings. Section 4968 of the Internal Revenue Code applies a net investment income tax to certain qualifying educational institutions. Part VI governance questions remain expanded, and Schedule A demand for public charity status verification persists.
Year-Specific Programs Applying to 2019 Form 990
Section 4960 excess remuneration excise tax applies to applicable tax-exempt organizations paying covered employees more than $1,000,000 in remuneration in calendar year 2019, with no adjustment for inflation. Section 4968 imposes a 1.4 percent excise tax on net investment income of applicable educational institutions (defined as certain private colleges and universities meeting specific endowment and student enrollment thresholds established under IRC 4968(b)(1)(D)), effective for tax years beginning after December 31, 2017.
Ten-Step Form 990 (2019) Filing Checklist
Step 1: Confirm Filing Requirement
Verify gross receipts for 2019 are greater than or equal to $200,000 OR total assets at the end of 2019 are greater than or equal to $500,000. If the organization is below both thresholds, it may file Form 990-N (e-postcard) instead. Organizations with less than $50,000 gross receipts typically may submit Form 990-N unless they are Section 509(a)(3) supporting organizations or other excluded entities per General Instructions Section B.
Step 2: Determine Accounting Method and Period
Determine whether the organization uses a calendar year or a fiscal year accounting period for 2019. Indicate in Item A of Form 990 the exact beginning and ending dates of the tax year. Select the accounting method used (cash or accrual) for Item G, Part I. If the technique changed from the prior year, explain the change in Schedule O. The Method must remain consistent year to year per the 2019 instructions.
Step 3: Gather Financial Documentation
Collect all 2019 revenue source documentation: cash contributions, grants, program service revenue (fees, tuition, memberships), investment income statements, and unrelated business income records. Compile W-2 forms for all employees, 1099-NEC or 1099-MISC forms for independent contractors, K-1s from partnerships or S-corporations, and 1098-T information if applicable. Obtain audited financial statements if the organization had gross revenues greater than or equal to $10,000,000 for 2019, or prepared review materials if less.
Step 4: Complete Core Form Parts I–XII
Begin with Parts VIII (Statement of Revenue), IX (Statement of Functional Expenses), and X (Balance Sheet) before completing the Part I summary section, per 2019 sequencing. Complete Part V governance questions regarding tax compliance filings. Complete Part VI governance questions: number of voting members (line 1a), independent voting members (line 1b), management structure, policies on conflicts of interest, whistleblower protection, and document retention. Ensure Part XII reflects the cash or accrual method and whether separate or consolidated audited financial statements were obtained for 2019.
Step 5: Determine Required Schedules via Part IV Checklist
Answer all Part IV yes/no questions. If “Yes” to line 1, complete Schedule A (Public Charity Status and Public Support) for Section 501(c)(3) organizations. If “Yes” to lines 15 or 16 (foreign grants exceeding $5,000), complete Schedule F. If “Yes” to line 21 or 22 (grants to domestic organizations or individuals exceeding $5,000), complete Schedule I.
If “Yes” to line 29 or 30 (noncash contributions exceeding $25,000 or specific assets), complete Schedule M. If “Yes” to line 34 (related organizations), complete Schedule R. If “Yes” to line 24a (tax-exempt bonds with principal exceeding $100,000 issued after December 31, 2002), complete Schedule K.
Step 6: Report Compensation for Key Persons (Part VII and Schedule J)
List all current officers, directors, and trustees regardless of compensation paid. List up to 20 key employees with compensation exceeding $150,000 from the organization and related organizations. List five highest-compensated employees exceeding $100,000 from the organization and related organizations who are not officers, directors, trustees, or key employees.
Report the five highest-compensated independent contractors receiving compensation exceeding $100,000 if the organization has any listed individuals—complete Schedule J (Compensation Information) showing reportable compensation, other compensation, and executive compensation practices.
Step 7: Address Section 4960 Excess Remuneration (If Applicable)
For each covered employee paid more than $1,000,000 in remuneration during 2019 (from the organization and related organizations combined), determine the excess remuneration amount. Calculate 21 percent excise tax on amounts exceeding $1,000,000. Review whether any covered employee received an excess parachute payment (payment contingent on separation from service at least three times base salary). Answer “Yes” to Part V, line 15 if the organization is subject to Section 4960 tax, and attach Form 4720 with Schedule N detailing excess remuneration and excess parachute payments.
Step 8: Complete Schedule A (If Applicable) and Assess Public Charity Status
For Section 501(c)(3) organizations, select the reason for public charity status in Schedule A Part I (lines 1–12, only one box checked). If the organization checked box 5, 7, or 8, or failed the Part III test, complete the Schedule A Part II support schedule. Calculate the public support percentage for a five-year rolling period; it must exceed 33 1/3 percent to maintain public charity status. If the organization qualifies under Section 509(a)(2), complete Part III and calculate the public support percentage (gifts, grants, program revenue, minus disqualified persons and excess contributions exceeding 2 percent); it must exceed 33 1/3 percent.
Step 9: Prepare and Attach Schedule O with All Explanations
Schedule O (Supplemental Information) is required for all Form 990 filers for the 2019 tax year. Provide narrative explanations for all “Yes” answers in the Part IV checklist. Explain any “No” answers to Part VI governance questions if the organization has not adopted the required policies. Describe program service accomplishments in response to Part III, line 4.
Provide supplemental information for any schedules that have been completed. Use Schedule O to clarify reconciliations in Part XI (Reconciliation of Net Assets) and Part XII (Financial Statements and Reporting).
Step 10: Sign, Date, and Assemble Before Paper Filing
Form 990 must be signed by an officer of the organization authorized to sign tax returns under penalties of perjury in the Part II signature block. Date the signature with the date of signing. If a preparer is used, the preparer must sign, date, and provide their Preparer Tax Identification Number (PTIN). Assemble the form with all required schedules (A through N and R as applicable based on Part IV answers), Schedule O, and audited financial statements or review materials if obtained.
Verify all page numbers and line entries are complete. Mail original and one copy to the IRS address specified on Form 990-N instructions or applicable Form 8868 extension (if filed). Calendar-year filers must mail by May 15, 2020, unless an extension is granted via Form 8868 (a six-month automatic extension is available).
2019 Form 990 Changes from Prior Years
Part V, Line 15 (Added)
Prior year instruction: Not required. 2019 instruction: Organizations subject to Section 4960 excess remuneration tax must check “Yes” and file Form 4720 Schedule N.
Part VI Governance (Clarified)
Prior year instruction: General governance questions. 2019 instruction: Expanded questions on conflict of interest, whistleblower, document retention policies, and board review of Form 990 before filing.
Part X, Net Assets (Redesigned)
Prior year instruction: Separate reporting of restricted and unrestricted net assets. 2019 instruction: FASB ASU 2016-14 classification: net assets without donor restrictions and net assets with donor restrictions (lines 27–28).
Schedule O (Clarified)
Prior year instruction: Optional for some filers. 2019 instruction: Required for all Form 990 filers in 2019.
Schedule A, Part II/III (Updated)
Prior year instruction: Public support calculation over five years. 2019 instruction: Calculate support over a five-year rolling period, excluding excess contributions that exceed 2 percent of the total.
Form-Specific Limitations for 2019 Form 990
Organizations filing Form 990-EZ (with gross receipts under $200,000 and total assets under $500,000) can only list their program service accomplishments in three lines; the full Form 990 allows for four named services plus an “Other” category. Nonresidents and foreign organizations must report their worldwide gross receipts and assets in U.S. dollars, with the conversion rate disclosed; there is no exemption from filing thresholds based on geographic location.
Organizations classified as Section 501(c)(3) and claiming to be public charities must pass either the Section 509(a)(1) public support test, which requires at least 33 1/3 percent support, or the Section 509(a)(2) test; if they do not meet either requirement,
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
