Does my foundation have to report any tax on political expenditures in Form 990-PF?
3.8k views | Last modified 12/27/2023 1:03:00 AM EST |

Applicable To
990-PF 990-N 990-EZ 990 8868 1120-POL

A private foundation must file Form 1120-POL if the foundation is subjected to a political organization's taxable income. The foundation's income produced due to political activities or any expenditures made on political activities is subjected to tax. This amount must be reported on Form 1120-POL, and the foundation must also pay taxes on this amount. The tax on political expenditures imposed on the foundation must be reported in Form 990-PF.
 If a foundation involves itself in any political activities like influencing political campaigns and elections or spends more than $100 for a political purpose, a detailed description of these activities must be attached with the Form 990-PF.
B is a private foundation and has campaigned for the Republicans in the Federal election in 2019. B had spent an amount of $1000 to organize and arrange a campaign. So, while filing Form 990-PF for the tax year 2019, B has to report this expense in the return, and a detailed description of the campaign must be provided while submitting the return. 
Since B has been involved in political activity during the tax year, the foundation is subjected to a tax on the expenses due to the campaign. B has to file Form 1120-POL for the tax year and must pay the taxes imposed on the foundation.
Here's how you report your tax on political expenditures in Form 990-PF using Tax990:

  1. Log into your Tax990 account.
  2. On the dashboard, click on the "Start New Return" button.
  3. Select the "Tax Year" and "Form 990-PF" options on the list of Federal returns.
  4. Enter your organization details and click "Next."
  5. On the "Organization Tax Year" page, select the tax year calendar or fiscal for which you want to file the information return. Once done, the subsequent steps will be to fill the actual parts of the form. 
  6. Under "Statement Regarding Activities," select "Political Activities."
  7. Under "Form 1120-POL", select "Yes" if your organization filed Form 1120-POL.
  8. Enter the appropriate values in the given boxes.
  9. Under "Political Activities," select "Yes" to enter details regarding the foundation's political activities.
  10. Click on "Add Political Activities" to provide a detailed description of these activities.
  11. Click Next and follow the subsequent steps as prompted.
  12. Review the details, Pay, and click the Transmit button to transmit your return to the IRS.

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