IRS Says No Plan Yet to Overhaul Private-Foundation Tax Form

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Conference Notebook

May 05, 2008

IRS Says No Plan Yet to Overhaul Private-Foundation Tax Form

While the Form 990-PF — which private foundations file with the Internal Revenue Service each year — could use a makeover, don’t expect one any time soon, Ronald J. Schultz, an IRS senior adviser told participants at the Council on Foundations meeting.

Mr. Schultz said many of the changes made on the new Form 990 — which charities must file starting with their 2008 tax year — could also be beneficial for the foundation form. In particular, he could envision creating a summary page at the beginning of the form to help the public better understand a foundation’s finances and mission. And he would also consider revising questions about compensation and adding new questions about governance practices.

But getting the money to pay for an overhaul of the Form 990-PF could prove difficult, particularly because relatively few organizations use it, he said. Mr. Schultz said only 75,000 or so groups file a 990-PF each year, compared with roughly 550,000 charities that file a Form 990 or Form 990-EZ.

He said if foundations want to see the form redesigned, they will have to “identify a compelling need” for it.

Marc Owens, a Washington lawyer who previously headed the IRS division that oversees nonprofit groups, said he knows of one part of the Form 990-PF he’d like to see eliminated: the list of investment transactions. He said the list provides heft to many foundations’ filings, yet does little to improve transparency or government oversight.

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IRS Says No Plan Yet to Overhaul Private-Foundation Tax Form