Skip to main content

Solutions

Products

Recommended products

Questions? We are here to help.
Contact us

Purchase

Questions? We are here to help.

Resources

Form 990

Reviewing Information Specific to Form 990-T

Form 990-T applies to exempt organizations and private foundations that have gross unrelated business income (including unrelated debt financed income) of $1,000 or more, that owe taxes other than the unrelated business income tax, or that want to claim a refund of other types of tax payments or credits. The total amount of all unrelated business taxable income from all unrelated trades or businesses is reported on line 1 of Form 990-T. A separate Schedule A details each unrelated trade or business the exempt organization or private foundation engages in.
In the account binder, the Form 990-T page is accessible from the
Tax Review-990
 main topic when the
990 T
 check box is selected on the Account Information page. To access the Form 990-T page, select
Tax Review-990
 then
Form 990-T
 in the topic list panel. The following graphic shows that, when the Form 990-T page is accessed, the
Schedule A-Unrelated Business Taxable Income from an Unrelated Trade or Business
 and the
Amended Return
 collapsible sections are open:
note
Much of the information on the Form 990-T page rolls from one year to the next. For example, you will answer the statement of activity questions the first year you use ONESOURCE Trust Tax to process the account. Each subsequent year, you will review then update only those questions that require updating.

Reviewing General and Organizational Activity Information

On the Form 990-T page, the
General Information and Organizational Activity
 collapsible section allows you to review, enter or update information reported in the heading section of Form 990-T.
If the organization or foundation received Form 2439 (Notice to Shareholder of Undistributed Long-Term Capital Gains) form a regulated investment company (RIC or REIT) then, beginning with tax year 2020, you can enter the Form 2439 information in the
Form 2439
 grid.

Reviewing Unrelated Business Taxable Income

Unrelated business taxable income is income from a trade or business, regularly carried on, that is not substantially related to the exempt purpose of the organization or foundation. On the Form 990-T page, the grid under the
Schedule A-Unrelated Business Taxable Income from an Unrelated Trade or Business
 collapsible section lists each unrelated trade or business activity the exempt organization or private foundation engages in. Use this grid to review, enter and update the descriptions, activity codes and loss carryover amounts for each unrelated trade or business activity. Selecting a
Schedule A
 link in the
Detail
 column displays the Schedule A detail page. Use this page to review, enter or update the income and deduction items for the unrelated trade or business activity. When available, selecting a
Detail
 link in the
Detail
 column on the Schedule A detail page displays the details for a specific item. For example:
  • Selecting the
    Detail
     link for the
    Cost of goods sold (Part III) (Override)
     row displays a pop-up window to use for reviewing, entering or updating the cost of goods sold details.
  • Selecting the
    Detail
     link for the
    Income (loss) from partnerships and S corporations (Override)
     row displays a pop-up window to use for reviewing, entering or updating the flow-through income or loss from a partnership or S-Corp investment.
  • Selecting the
    Detail
     link for the
    Compensation of officers, directors and trustees (Part X) (Override)
     row (in the
    Deductions Not Taken Elsewhere
     grid) displays a pop-up window to use for reviewing, entering or updating the compensation allocable to gross unrelated business income.

Reviewing Total Unrelated Business Taxable Income

Exempt organizations and private foundations can claim certain deductions, which are reported in Part I of Form 990-T, when calculating unrelated business taxable income. Beginning with tax year 2022, these deductions include:
  • A charitable contribution deduction
  • A deduction for net operating losses created in tax years beginning before January 1, 2018
  • The $1,000 specific deduction
For tax years prior to tax year 2022, these deductions include the deductions listed above as well as the Section 199A qualified business deduction for exempt organizations and private foundations created as trusts.
On the Form 990-T page, use the grid under the
Total Unrelated Business Taxable Income (Part I)
 collapsible section to review, enter and update the amounts for these allowable deductions.

Reviewing Tax Computation and Payment Amounts

Part II of Form 990-T is used to report the proxy tax on lobbying and political expenditures (for organizations that engage in lobbying activities), the calculated alternative minimum tax (for organizations created as exempt trusts with unrelated business income), or the income tax for noncompliant hospital facility income (for tax-exempt charitable hospitals). Part III of Form 990-T is used to report amounts used for claiming tax credits that may reduce the unrelated business income tax. On the Form 990-T page, the
Tax Computation and Payments (Parts II & III)
 collapsible section is categorized into:
  • Tax Computation
    -Corresponds to Part II and includes:
    • The
      Annualize taxable income for a short year
       check box. Select this check box only when an exempt organization or private foundation is filing on a short-year basis.
    • A grid for reviewing, entering or updating amounts related to the proxy tax, the alternative minimum tax, and the income tax for noncompliant hospital facility income.
  • Tax and Payments
    -Corresponds to Part III and includes:
    • The
      Request credit for small employer health insurance premiums paid
       check box. Select this check box to claim the small business health care tax credit.
    • The
      Appropriate form number generating credit (other than Form 3800)
       field. Except for Form 3800, use this field to enter the IRS Form number associated with the tax credit being claimed.
    • A grid for reviewing, entering or updating amounts used for claiming tax credits that may reduce the unrelated business income tax.

Reviewing Statements Regarding Certain Activities, Other Information, and Supplemental Information

Part IV of Form 990-T asks several questions about certain activities an exempt organization or private foundation may participate in. Part IV is also used to report pre-2018 and post-2017 net operating loss (NOL) carryovers. Part V of Form 990-T is used to provide explanations to the questions in Part IV.
You can use the
Statements Regarding Certain Activities and Other Information and Supplemental Information (Parts IV & V)
 collapsible section on the Form 990-T page to:
  • Answer the questions in Part IV. Each question should be answered rather than leaving blank.
  • Review, enter or update the explanations to the Part IV questions.
  • Enter the total pre-2018 NOL carryover amount.
  • Select the business activity code and enter the post-2017 NOL carryover amount for each unrelated trade or business. Your pre-2018 and post-2017 NOL carryover entries do not roll to subsequent tax years.

Entering Amended Return Information

Beginning with tax year 2021, you can use the
Amended Return
 collapsible section on the Form 990-T page to enter the following information for an amended 990-T return:
  • An explanation of the changes to the return.
  • The line number or box that changed.
  • A description for the change.
  • The amount reported on the previous 990-T return.
  • The amount reported on the amended 990-T return.

This article applies to:

  • PRODUCT: ONESOURCE Trust Tax
  • Return type: 990 Exempt Organization