Final answer:
The claim that nonprofits need over $100,000 in annual revenues to file Form 990 with the IRS is false. Nonprofits with gross receipts over $50,000 must file Form 990 or Form 990-EZ, and exceptions apply to certain organizations like churches. Compliance with filing requirements is essential for maintaining tax-exempt status.
Step-by-step explanation:
The statement that nonprofits are not required to file a Form 990 with the IRS unless their annual revenues are over $100,000 is false. In fact, the threshold for filing Form 990 is much lower. Nonprofit organizations that have gross receipts of $50,000 or less can file Form 990-N, also known as the e-Postcard. Those with gross receipts above $50,000 must file either Form 990 or Form 990-EZ, depending on their gross receipts and total assets. Moreover, organizations with gross receipts greater than $200,000 or total assets greater than $500,000 are required to file Form 990 instead of 990-EZ.
There are some exceptions to these requirements. For instance, churches and some religious organizations are not required to file a Form 990. Additionally, certain subsidiaries of other nonprofits may not need to file separately if included in a group return. It's crucial for nonprofits to be aware of their filing obligations to maintain their tax-exempt status, as failure to file for three consecutive years will result in automatic revocation.
To ensure compliance, nonprofit organizations should consult the IRS guidelines or seek professional advice to determine the specific form they must submit based on their financial activity. By adhering to these guidelines, nonprofits can continue to focus on their mission without the risk of losing their tax-exempt status.