A Resource Squeeze Meets an Unchanged Compliance Burden
Charities and not-for-profits are navigating a difficult financial environment. Inflation has raised operating costs across the board, while charitable contributions have softened in many categories. The combined pressure is most acute at smaller and mid-size organizations, which lack the reserves to absorb both dynamics simultaneously.
Form 990 Remains a Core Obligation
Form 990 is the central IRS reporting requirement for tax-exempt organizations. It captures revenue, expenses, governance information, and programmatic activity — and filing on time is a precondition for maintaining tax-exempt status. The stakes are high: late or inaccurate filings can trigger penalties and, in worst-case scenarios, jeopardize exempt status entirely.
Why Filing Has Become Harder
The compliance burden has not eased, but the capacity to meet it has:
- Gathering the underlying financial data is time-consuming and often requires coordination across multiple systems
- The form itself has grown in length and complexity over successive revisions
- Staff and resource constraints limit how much nonprofit capacity can be redirected from programmatic work to compliance reporting
The Case for Additional Support
Many nonprofits are asking for more flexibility from the IRS — additional filing time, clearer guidance on specific items, and reduced reporting complexity for smaller organizations. These requests reflect the operational reality rather than a desire to avoid transparency.
Implications
For CPAs serving nonprofit clients, Form 990 support is moving from a transactional engagement to a genuine advisory relationship. Firms able to streamline the data-collection workflow and help clients navigate the form efficiently deliver meaningful value in an environment where nonprofit resources are genuinely stretched.