My organization changed its accounting method from the prior year. How do I report it on Schedule A?
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Last modified 3/14/2023 9:09:07 AM EST |
Generally, an organization should use the same accounting method on its annual information return (Form 990 or Form 990-EZ) and in all the schedules while reporting the revenue and expenses for the tax year.
If your organization changed its accounting method and filing Schedule A along with Form 990 for the tax year, then it is necessary to report all the amounts in Schedule A using the accounting method changed by the organization.
However the amounts to be reported for Type III Non-Functionally Integrated 509(a)(3) Supporting Organizations under Section D, Distributions, and Section E, Distribution Allocations of must be reported as cash receipts and disbursements method, regardless of the change in an organization's accounting method.
For example, consider an organization that uses Cash as an accounting method and reports all the amount in Schedule A of Form 990. If the organization either decides to change its accounting method or if requested by the state to report its revenue, expenses, or balance sheet items differently from the usual accounting method, then the organization is required to change its accounting method while filing Form 990.
If changing the accounting method from the prior year or checking the "Other" box in Part XII, Financial Statements, and Reporting of Form 990, the organization is required to explain the change in Schedule O, Supplemental Information.
While filing your Form 990 in Tax990 using the "Interview-Based" filing, the Schedule A will be automatically generated based on the filing requirement. The Schedule A will be made available to you depending upon the information you enter in your Form 990 using the "Form-Based" filing in Tax990.