Spring 2009 issue of Horizons

INDUSTRy u

NOT-FOR-PROFIT

Compensation Reporting Changes for the 2008 Versions of IRS Form 990 and Form 990EZ

The new Form 990 has changed the requirements for reporting of compensation of officers, key employees and board members. There also are changes for reporting the top paid employees other than officers and key employees and for reporting the top paid independent contractors. Under transitional rules, filers with gross receipts of less than $1 million and total assets of less than $2.5 million can file the 2008 Form 990EZ, which has changed to a lesser degree. These forms relate to returns filed for years beginning on or after January 1, 2008. Part VII of the main “core” form requires a listing of officers, directors, key employees, highest compensated employees and independent contractors, combining information that was required on the prior versions of Form 990, plus information on the prior version of Schedule A. One result is that all types of tax-exempt filers, including trade associations and social clubs, may be subject to reporting the five highest compensated employees and five highest paid independent contractors. Previously, only 501(c)(3) entities reported these two groups. There also has been a change in the minimum threshold for Where Is Compensation Reported?

By Jeff Person, CPA

u spring 2009 issue

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