IRS Instruction 990 or 990-EZ (Schedule G) – Nonprofit organizations play a vital role in supporting communities through fundraising events, professional services, and gaming activities. However, to maintain tax-exempt status, accurate reporting is crucial. Enter IRS Schedule G (Form 990 or 990-EZ)—a key supplemental schedule that provides detailed insights into these revenue streams. If your organization exceeds certain thresholds for professional fundraising, events, or gaming, completing Schedule G ensures compliance with IRS regulations.
In this comprehensive guide, we’ll break down the Instructions for Schedule G (Form 990), covering its purpose, filing requirements, line-by-line details, and tips for seamless submission. Whether you’re a small charity hosting galas or a larger nonprofit running bingo nights, mastering Schedule G helps avoid penalties and builds transparency with donors.
Download the official PDF instructions here: IRS Schedule G Instructions (2024).
What is IRS Schedule G and Why Does It Matter?
Schedule G is a required attachment to Form 990 or Form 990-EZ for tax-exempt organizations under section 501(c). Its primary purpose is to report supplemental information regarding fundraising or gaming activities, including professional fundraising services, event details, and gaming revenue.
This schedule promotes accountability by disclosing how nonprofits solicit funds and manage related expenses. For instance, it reveals reliance on paid fundraisers and the net impact of events—information that donors and regulators scrutinize. Failing to file when required can trigger IRS audits or loss of exempt status.
Key thresholds trigger filing:
- Professional fundraising expenses > $15,000.
- Fundraising event gross income and contributions > $15,000.
- Gaming gross income > $15,000.
These rules apply to voluntary filers too, ensuring full disclosure.
Who Must File Schedule G (Form 990 or 990-EZ)?
Not every nonprofit needs Schedule G, but many do based on Form 990’s Part IV checklist. Here’s a quick breakdown:
| Trigger | Form 990 Filers | Form 990-EZ Filers | Required Part |
|---|---|---|---|
| Professional fundraising services expenses > $15,000 (Part IX, lines 6 & 11e) | Yes (Part IV, line 17) | No | Part I |
| Fundraising events gross income/contributions > $15,000 (Part VIII, lines 1c & 8a) | Yes (Part IV, line 18) | Yes (Part I, lines 1 & 6b) | Part II |
| Gaming gross income > $15,000 (Part VIII, line 9a) | Yes (Part IV, line 19) | Yes (Part I, line 6a) | Part III |
If your organization meets any criterion, attach the completed Schedule G. Remember, even oral agreements count as professional services—exclude only internal staff acting in official roles.
How to Complete Part I: Reporting Professional Fundraising Services?
Part I focuses on professional fundraising services, mandatory for Form 990 filers exceeding the $15,000 expense threshold. (990-EZ filers skip this.)
Line 1: Fundraising Methods
Check all applicable boxes for methods used, such as mail solicitations, email campaigns, or phone drives. This sets the stage for transparency.
Line 2: Agreements and Top-Paid Fundraisers
- Line 2a: Indicate if you had any agreements (written or oral) for services. Examples include consultants for direct mail strategies or database management for multi-channel campaigns.
- Line 2b: List your top 10 highest-paid individuals/entities (≥ $5,000 compensation). Include:
- Column (i): Name and business address.
- Column (ii): Activity types (e.g., “Internet and email consulting”).
- Column (iii): Fund custody/control details—explain in Part IV if complex (e.g., fundraiser holds funds before remitting).
- Column (iv): Gross receipts generated.
- Column (v): Fees paid (include undistinguished expenses here if not separated).
- Column (vi): Net receipts (iv minus v).
Tip: For planning services like feasibility studies with no current-year receipts, enter $0 in column (iv). Always describe fee vs. expense breakdowns in Part IV to avoid IRS queries.
Line 3: State Registrations
List all states where you’re registered to solicit funds or exempt from registration. This ensures compliance with state charity laws.
Mastering Part II: Fundraising Events Reporting
Complete Part II if event-related totals exceed $15,000. Report only events with > $5,000 gross receipts—aggregate smaller ones if needed.
Detail your two largest events in columns (a) and (b), lumping others into (c) as “All other events.”
Revenue Section
- Line 1: Total gross receipts (no deductions).
- Line 2: Contributions/gifts (cash and noncash).
- Line 3: Gross income (line 1 minus line 2).
Direct Expenses Section
Break down costs per event:
- Lines 4–5: Prizes (cash and noncash FMV).
- Lines 6–8: Rent, food/beverages, entertainment.
- Line 9: Other expenses (e.g., contractor wages—keep itemized records).
- Line 10: Total expenses.
- Line 11: Net income (line 3 minus line 10).
Pro Tip: Exclude gaming revenue here—route it to Part III. Retain detailed expense lists for audits.
Navigating Part III: Gaming Activities Disclosure
For organizations with > $15,000 in gaming income (e.g., bingo, pull-tabs), Part III demands granular reporting. Treat all bingo as one event (column a), pull-tabs as another (b), and others in (c).
Revenue and Expenses
- Line 1: Gross revenue (receipts minus contributions).
- Lines 2–5: Prizes, rent, and other expenses (e.g., labor, excise taxes like wagering fees).
- Line 6: Volunteer labor percentage (if > substantially all work is volunteer).
- Line 7: Total expenses.
- Line 8: Net income.
Compliance and Oversight
- Lines 9–10: States of operation, licensure status, and any revocations (explain in Part IV).
- Line 11: Nonmember participation (bona fide guests count as members; see IRS Pub. 3079).
- Line 12: Involvement in trusts/partnerships for gaming.
- Lines 13–14: Facility usage and recordkeeper details.
- Lines 15–17: Third-party contracts, supervisors, and mandatory distributions (e.g., state-required payouts).
Gaming rules are strict—noncompliance can jeopardize exemptions. Aggregate distributions by state in Part IV.
Using Part IV: Supplemental Information
This narrative section clarifies ambiguities:
- Part I details (e.g., fund control, fee breakdowns).
- Part III explanations (e.g., licensure issues, third-party revenues).
Always reference the specific part/line for clarity.
Key Definitions and Recordkeeping Essentials
To avoid errors, know these terms:
- Professional Fundraising Services: Paid external help (not internal staff).
- Gross Receipts: Total before deductions.
- Fair Market Value (FMV): Prize worth at donation time.
- Mandatory Distributions: State-mandated gaming payouts.
Recordkeeping: Maintain itemized expense lists, volunteer hour logs, and agreement copies. For gaming, track nonmember participation and distributions meticulously.
2024 Updates and Compliance Tips for IRS Schedule G
The 2024 instructions (revised December 2024) are now on a continuous-use basis through future years until updated—streamlining filings for ongoing compliance. No major structural changes, but emphasis on volunteer percentages and third-party disclosures remains.
Top Tips:
- Cross-check totals with Form 990 Part VIII for consistency.
- Use Part IV liberally for explanations—brevity can lead to follow-up questions.
- Consult state attorneys general for registration nuances.
- For complex setups (e.g., shared gaming operations), reference IRS Pub. 3079.
- File electronically if possible for faster processing.
Final Thoughts: Stay Compliant and Transparent
Mastering IRS Schedule G (Form 990 or 990-EZ) isn’t just about checkboxes—it’s about demonstrating your nonprofit’s integrity. Accurate reporting of fundraising activities and gaming operations fosters donor trust and safeguards your mission.
If your organization handles significant events or gaming, consider professional tax advice. For the full details, download the official IRS PDF and review the glossary in Form 990 instructions.
Keywords: IRS Schedule G, Form 990 fundraising reporting, 990-EZ gaming activities, professional fundraiser disclosure, nonprofit compliance 2024.