The IRS announced in October 2024 that tax-exempt organizations must follow new electronic filing rules beginning with Tax Year 2023 returns filed in 2024. The changes reduce the e-file threshold to 10 information returns and extend deadlines for clean energy credit elections, affecting thousands of nonprofits, charities, and other exempt entities.
Starting with Tax Year 2023 returns, organizations that submit 10 or more information returns in a calendar year must e-file them. The previous threshold was 250, which excluded many smaller groups.
The rule applies to W-2s, 1099-NEC, 1099-DIV, and similar forms. For example, a nonprofit filing four Forms 1099-NEC, four Forms 1099-DIV, and two W-2s reaches the 10-return limit and must e-file.
The IRS created the Information Returns Intake System (IRIS), a free platform for filing 1099-series forms. This service helps organizations prepare returns, ensure accuracy, and avoid penalties.
Groups unable to meet requirements may request approval to file on paper using Form 8508. The IRS explained that the threshold change is defined under the Taxpayer First Act to modernize services, reduce paperwork, and improve data review.
The new rules apply now to filings prepared in 2024. Organizations must count all information returns when determining if they meet the threshold.
The IRS urged groups to review their filing volume in advance, learn the requirements, and prepare early. Missing deadlines or filing late could result in penalties. By using IRS services and approved software, organizations can meet obligations and ensure accurate reporting.
For most tax-exempt organizations, the due date for annual returns is the 15th day of the fifth month after the end of the tax year, which is May 15 for calendar-year groups. An automatic six-month extension is available through Form 8868 if submitted before the original deadline.
Revenue Procedure 2024-39 extends the time to file for clean energy projects. Organizations making elective payment elections on Form 990-T now receive an automatic six-month extension, even if they did not request one earlier.
The IRS also temporarily allows paper filing of Form 990-T for these cases, giving organizations time to file returns and avoid late penalties.
The new rule applies to projects placed in service between December 31, 2023, and November 30, 2024. Nonprofits that installed solar panels, wind turbines, or similar systems can file elections later while still receiving payments instead of unused credits.
The extension ensures that groups such as schools, churches, and community centers can use this option without losing benefits. Temporary permission to file on paper provides flexibility until IRS software updates are complete.
Smaller nonprofits may face challenges adjusting, but will benefit from free filing services and clearer deadlines. Larger organizations already using e-file will see little change.
Foundations, political groups, and trusts are also required to comply. Entities that fail to file returns for three straight years risk automatic revocation of tax-exempt status. The IRS advises representatives to review deadlines, request extensions when needed, and ensure accuracy at the end of each filing season.
Tax-exempt organizations can access forms, explanations, and assistance on IRS.gov. Each IRS page displays a locked padlock icon for security and a notice such as “Page Last Reviewed or Updated: November 2024” to confirm the guidance is current.
The IRS encourages organizations to review these pages, learn about filing requirements, and ensure returns are completed on time. Email alerts and webinars also provide updates, answer questions, and guide representatives on how compliance is approved and deadlines are met.
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