Breaking Down Form 990 Schedule E: A Comprehensive Guide
Explore the purpose and significance of Form 990, Schedule E, and gain valuable insights for completing it with confidence.
990 Schedules are a key component of legal and tax reporting for a nonprofit. They also provide a comprehensive view of the organization’s financial status and operational practices. By fulfilling these reporting requirements, organizations meet regulatory obligations, strengthen public trust, and reinforce their reputation all at once.
In the previous blogs of this series, we’ve covered different 990 schedules, including Schedule A, Schedule B, Schedule C, and Schedule D. In this blog, we’ll discuss Form 990 Schedule E and its filing requirements.
Form 990 Schedule E — A Detailed Breakdown
Form 990 Schedule E is a supplementary form used by schools and educational institutions to report detailed information about activities and racial nondiscrimination policies in addition to their 990 or 990-EZ form.
Who’s Required to File 990 Schedule E?
Organizations classified as private schools under IRS Section 170(b)(1)(A)(ii) are generally required to attach Form 990 Schedule E when filing their Form 990 or Form 990-EZ.
This schedule must be included along with their primary form if,
- They indicated their status by answering “Yes” on Part IV, line 13 of Form 990.
- They answered “Yes” on Part VI, line 48 of Form 990-EZ.
How to Complete 990 Schedule E?
Form 990 Schedule E requires schools to complete two sections to demonstrate compliance with IRS guidelines on racial nondiscrimination.
Part I:
This section consists of a series of “Yes” or “No” questions to assess adherence to IRS guidelines on nondiscrimination. Specifically, you must report:
- Whether your school’s charter, bylaws, or other governing documents include a statement summarizing its nondiscriminatory policy.
- Whether your school’s nondiscriminatory policy is included in brochures, catalogs, and other written materials related to student admissions, programs, and scholarships.
- Whether your nondiscriminatory policy is accessible to the general community through your website, newspapers, or other media. If not, explain.
- Records on the racial composition of the student body, faculty, and administrative staff.
- Documentation shows that scholarships and financial aid are provided on a nondiscriminatory basis.
- Copies of brochures, catalogs, and other documents related to student admissions, programs, and scholarships.
- Copies of materials used to solicit contributions.
Whether your school practices racial discrimination in:
- Student rights or privileges
- Admissions policies
- Employment of faculty or staff
- Scholarships or financial assistance
- Educational policies
- Use of facilities
- Athletic programs
- Other extracurricular activities
Whether your school receives any financial support from government entities.
Confirmation that your school complies with all IRS requirements related to racial nondiscrimination.
Part II — Supplemental Information
You can use this section to provide explanations for some of the questions in the previous section and to provide additional information about any other questions if necessary.
Conclusion
Form 990 Schedules are more than just a regulatory compliance tool, they are vital for enhancing an organization’s transparency and credibility. Using a reliable e-file provider might considerably reduce these filing burdens in half.
Tax990, an IRS-authorized e-file provider, helps nonprofits save both time and money on their Form 990 filings. It offers free attachment of all the required Schedules alongside the primary 990 forms. It also features comprehensive tools to streamline and simplify the filing experience for every user.
