Organizations exempt from income tax such as ours have long been required to file annual information returns (Form 990) with the Internal Revenue Service. However, until the Tax Reform Act of 1969, little was done to encourage compliance with these requirements. It was at this time, too, that the tax on unrelated business income (usually income from nonmember sources) was extended to exempt organizations.
Each chapter must file Form 990 on or before the 15th day of the 5th month after the close of their accounting period. In most cases your Form 990 must be filed by November 15th each year, assuming you follow the usual college or university fiscal year of July 1 to June 30.
The penalties for not filing annual information returns, in addition to risk of loss of exempt status, can mount at the rate of $10 per day to a maximum of $5,000 for each year an organization fails to file.
When To File:
Many chapters will be eligible to file the 990-EZ. You may use this form if the chapter’s gross receipts are less than $100,000 AND total assets are less than $250,000 at year-end.
All Kappa Alpha chapters (active and alumni) are automatically exempt organizations under 501(c) (7). The date of our Exemption Letter is September 22, 1944.
Hints When Filing:
- In the block “Type of Organization,” check the box “Exempt under 501(c)” and insert the number 7 in the parentheses.
- In block “H” on the 990-Ez and block “I” on the 990, you’ll need a four-digit group exemption number. Kappa Alpha Order’s GEN is 0066. On the 990, make sure that you have checked yes to question “H (C)” (Organization covered by a group ruling).
- Part 11- If your chapter has Gross Receipts of more than $25,000 (“Receipts from Other Sources”, Line 1, Part I), you must fill in this Part II also.
IMPORTANT: When you have filled in Form 990 to the best of your ability make two photocopies of it - one for your files and one to send to the National Administrative Office for safekeeping.
