Many churches and religious organizations are aware that the IRS does not require them to file an annual Form 990. However, choosing to file this information return voluntarily can offer several benefits for your church, from increased transparency to stronger donor relationships.

Form 990 is an IRS information return that tax-exempt organizations use to report their finances, governance, programs, and activities. For most nonprofits, filing this form is essential for maintaining their 501(c)(3) tax-exempt status. However, churches are exempt from this requirement under IRS rules.

Churches and other religious organizations receive special tax treatment under U.S. law. The IRS does not require them to file Form 990 or its variations (990EZ, 990N) to maintain their tax-exempt status. This exemption recognizes the unique role of religious institutions in society and aims to protect religious freedom and privacy.

However, just because churches aren’t required to file doesn’t mean they shouldn’t.

In today’s world, transparency is key to building trust with your congregation, donors, and the community. Filing Form 990 provides detailed information about your church's finances, governance, and programs. This openness can demonstrate financial responsibility and help donors feel confident that their contributions are being used wisely.

Many donors, especially large institutional or corporate donors, look at Form 990 filings when evaluating nonprofits. Even though churches are not required to file, doing so voluntarily can give potential donors greater confidence in your financial practices. Some foundations and grant-making organizations require a 990 as part of the grant application process. By filing, your church could access new funding opportunities.

The Form 990 includes questions about your church’s governance, policies, and procedures. Filing can encourage your church to adopt best practices for accountability, conflict of interest policies, and internal controls. This could help strengthen your leadership and reduce risks related to financial mismanagement or compliance issues.

Form 990 isn’t just about finances—it also gives you a chance to share your church’s mission and impact. By filing, your church can highlight its programs, services, and community outreach. This can serve as a public relations tool to inform your congregation and the broader community about the meaningful work your church is doing.

While churches aren’t required to file now, tax laws can change. By proactively filing Form 990, your church will be prepared in the event that reporting requirements become mandatory for all religious organizations in the future. This can help avoid the scramble to get organized if new laws or regulations are passed.

When filing Form 990, your church will need to report:

Filing Form 990 can seem daunting, but Instant Nonprofit is here to help simplify the process. Our AutoPilot Package offers ongoing support for maintaining your church’s compliance and can assist with filing the appropriate version of Form 990—whether it’s the full version, 990EZ, or 990N. Our experts will ensure that your church’s financial information is accurately reported, helping you build trust and credibility while staying prepared for future changes in IRS regulations.

While churches are not required to file Form 990, voluntarily doing so can provide significant advantages, from improving transparency to attracting more donors. Filing helps your church demonstrate financial accountability, highlight your community impact, and strengthen internal governance. By filing Form 990, your church can build trust with its congregation, donors, and the broader community, ensuring long-term sustainability and success.

For help with your church’s compliance and 990 filing needs, explore Instant Nonprofit’s AutoPilot Package and let our team guide you through the process.