Form 990-T : The Purpose and Requirements

Form 990-T (Exempt Organization Business Income Tax Return and Proxy Tax Under Section 6033(e)) is an information return used by tax-exempt organizations to report unrelated business income and tax liabilities with the IRS.

Form 990-T is also used for the following purposes:

• To claim a refund on an income tax paid by a Regulated Investment Company (RIC) or a Real Estate Investment Trust (REIT) on an undistributed long-term capital gain.
• To report proxy tax liability.
• To request credits for certain federal excise taxes paid or for small employer health insurance premiums paid.
• To report unrelated business income tax on reinsurance entities.

Exempt organizations that file Form 990, 990-EZ, or 990-PF and have a gross income of $1,000 or more from unrelated business income for the tax year must e-file Form 990-T.

Based on the type of organization, the deadline for filing Form 990-T may vary.

• Employees' trusts, defined in section 401(a), IRAs (including SEPs and SIMPLEs), Roth IRAs, Coverdell ESAs, or 408(a) (Archer MSAs) must file Form 990-T by the 15th day of the 4th month after the end of their tax year.
• Other organizations must file Form 990-T by the 15th day of the 5th month after the end of their tax year.

Note: If the due date falls on a weekend or federal holiday, file the form on the next business day.

The following information is required to file Form 990-T electronically:

• The organization's name, EIN, address, and phone number
• Relevant details about any address changes, name changes, or filing an amended return
• Group exemption number
• Organization's tax-exempt status
• If you are only filing Form 990-T to claim a credit from Form 8941 and/or to claim a refund shown on Form 2439, provide relevant details
• Type of 990 Form that the organization files
• The fair market value of all assets at the end of the year
• Schedule A details attached with Form 990-T

Depending on the information reported on Form 990-T, organizations may be required to provide additional information by attaching Schedule A.

Depending on the information provided on filing Form 990-T and Schedule A, organizations may be required to attach additional supporting forms.

Click here for more information about Schedule A.

• An organization that fails to file its return on or before the due date (including an extension of time for filing) will become subject to a penalty of 5% of the unpaid tax for each month, or part of a month, that the return is late.
• The maximum penalty is 25% of the unpaid tax. The minimum penalty for a return that is more than 60 days late is the smaller of the taxes due, or $435.
• The penalty for paying taxes late is usually 1/2 of 1% of the unpaid taxes for each month or part of a month the tax is unpaid. This penalty can’t exceed 25% of the unpaid tax.
• The IRS won’t impose a penalty if the filing organization provides a reasonable explanation for filing late.

To learn more about Form 990-T penalties, click here.

If your organization needs additional time to file Form 990-T, you can request an automatic extension of time using Form 8868, Application for Automatic Extension of Time To File an Exempt Organization Return.

Note: Even if your organization requests an extension with IRS Form 8868, you will still need to pay any taxes due in full by the return’s original due date.

The IRS mandated electronic filing of Form 990-T under the Taxpayer First Act of 2019 (Pub. L. 116-25).

The best way to complete the filing of Form 990-T easily and securely is by getting started with an IRS-authorized e-file provider.

ExpressTaxExempt is the market-leading, IRS-authorized e-file provider chosen by thousands of Exempt organizations!

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