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Electronic filing of 990s required for all groups by new law

Implementation gives some associations until 2022 to file first digital return; advocates see benefit to nonprofits and public policy

July 12, 2019
By William Ehart

A new law mandates tax-exempt organizations to file their tax returns electronically, but the requirement will be phased in gradually.

President Donald Trump signed the Taxpayer First Act on July 1, an Internal Revenue Service reform effort that contains the electronic Form 990 provision.

The measure has provoked little concern in the association community, partly because the change has been long proposed and partly because most larger associations already file electronically, while small groups have been required to file the simple e-postcard Form 990-N since 2007.

The nonprofit sector has caught up technologically since mandatory electronic filing was first proposed in 2005, said Allison Grayson, director of policy development and analysis at Independent Sector, an association representing nonprofit groups.

“The digital divide within the sector has closed,” she said.

Independent Sector was a strong proponent of the electronic filing requirement, Grayson said.