Form 990-PF (2020)

What Is IRS Form 990-PF?

IRS Form 990-PF is a United States Internal Revenue Service form that private foundations use to report annual financial activities. Due to the yearly updates in tax laws and regulations, private foundations must be keen to follow the instructions for the 2020 iteration closely. The form for 2020 provides a transparent look at a foundation's assets, grants distributed, trustees and officers, and investment income, among other financial data.

How to Fill Out the Form 990-PF Accurately

Knowing how to complete the Form 990-PF is key to a smooth filing process. To start, private foundations need to gather all pertinent financial records from the 2020 tax year. This includes detailed records of grants given, investment returns, revenue from other sources, and a list of officers and trustees. Here is a structured way to approach this IRS form:

1. Start with the foundation's name, filling it out in the designated area at the top of the form.
2. Input the address details, including the street address or P.O. box number, room or suite number, and the city, state, province, country, and postal code.
3. Indicate the foundation's filing status by marking the applicable boxes such as initial return, final return, address change, return of a former public charity, amended return, or name change.
4. Select your organization type, choosing from options like a Section 501(c)(3) exempt private foundation, Section 4947(a)(1) nonexempt charitable trust, or other taxable private foundations.
5. Specify the foundation's accounting method, selecting cash, accrual, or another method, and provide details if necessary.
6. For revenue and expenses analysis, accurately report all amounts by specifying all sources of income and the corresponding expenses in this section.
7. On the balance sheets, detail the foundation's assets, liabilities, and net assets.
8. Reflect changes in net assets or fund balances, summarizing the differences between the beginning and end of the year.
9. Report any capital gains and losses to calculate tax on investment income. 
10. If the foundation qualifies for reduced tax under Section 4940(e), complete the relevant section, showing how you fulfill the requirements.
11. Calculate the excise tax based on investment income, following the instructions for the appropriate tax rate and amounts.
12. Disclose information about activities, checking all activities conducted during the year and providing details where prompted.
13. Reveal any transactions that might invoke the requirement to complete Form 4720 in the statements regarding activities.
14. List details about officers, directors, trustees, managers, highly compensated employees, and contractors, including their compensation, if any.
15. Outline the direct charitable activities the foundation engaged in throughout the year.
16. Summarize any program-related investments made.
17. Calculate the minimum investment return for the foundation and input the relevant amount.
18. Determine the distributable amount, based on the foundation's fair market value and other factors according to IRS instructions.
19. Calculate and report the qualifying distributions, which include amounts spent on char**itable activities or set aside for future charitable purposes**.
20. For undistributed income, report any amounts from previous years that have not yet been distributed for charitable purposes.
21. If your organization operates as a private operating foundation, fill in the details of income, expenses, assets, and support to verify this classification.
22. Complete the supplementary information section, including details about assets and transactions, if the foundation had $5,000 or more in assets at any time during the year.
23. Analyze income-producing activities, detailing all activities and the income they generated.
24. Describe the relationship between income-producing activities and the accomplishment of your exempt purposes.
25. Provide information about transfers, transactions, and relationships with noncharitable exempt organizations.
26. Sign the form, including the signature of the officer or trustee, the date, and their title.
27. If a paid preparer was used, the preparer must fill in their section with their identifying information and signature.

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