[E-file Error Code F990PF-038-01] How do I resolve it?
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Applicable To
990-PF 990-N 990-EZ 990 8868 1120-POL

IRS Error Code [F990PF-038-01]:

If Form 990-PF, Part VII-A, Line 9 has a choice of 'Yes' indicated, then one or more of the following groups of fields in Part XIV must have a value: [ Line 3a(1)(e) and Line 3a(2)(e) ] OR Line 3b(e) OR [ Line 3c(1)(e) and Line 3c(2)(e) and Line 3c(3)(e) and Line 3c(4)(e) ].

Rejection Message:

The organization has to substantiate its claim as a private operating foundation by taking up a test that is appropriate to the section under which it is categorized- 4942(j)(3) or 4942(j)(5).

What does it mean:

As such, the organization has filed its return without taking up the recommended tests to prove its private operating foundation status. According to the IRS mandate, a private operating foundation classified under section 4942(j)(3) has to take up any of the three tests- Asset Test, Endowment Test, Support Test. Whereas those classified under 4942(j)(5) have to take up the Endowment Test.

Resolution:

The organization has to take up the test appropriate to the section under which it is classified to prove its claim as a private operating foundation.

Here's how you should take up the test:

  1. Log in to your Tax990 account
  2. Identify the rejected return either from the Dashboard or Forms History.
  3. To identify it from the Dashboard, keep a note of the Return ID of the rejected return that you find in the rejection email. 
  4. To identify it from the Forms History page, click the Tax Returns on the menu, and you'll land in the Forms History page, where you'll find the rejected return listed. 
  5. In both options, you need to click on the Rejected by the IRS button found against the rejected return to find the list of errors. Then, click the Fix Me button against the error code F990PF-038-01.
  6. Based on the filing type you have chosen, you will be navigated to the corresponding page.
    • Interview-based filing - You'll be directed to the page where you can pick any one test that the organization wants to take. On the next screen, you'll find the actual details that are required for that particular test.
    • Form-based filing - You'll be directed to Part XIV Line 3 of Form 990-PF. Complete any one of the tests (3a, b, or c) and enter the details required for the selected test.

 

7. On the next screen, you'll find the actual details that are required for that particular test.

8. Review the details, and click the Transmit button to re-transmit your return to the IRS at no additional cost.

We'll keep you informed on the status of the return once we hear back from the IRS.

For any further assistance, we recommend contacting the IRS e-Help Desk Toll-Free Number 1-866-255-0654.

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