Using Your 990 as a Marketing Tool

Posted on Wednesday, March 26, 2014

Unlike corporate and individual tax returns, Form 990 is an information return that reports on an organization’s program and activities.  It does not report on and calculate taxes owed.  Often times the focus is on the numbers and not the text, but an organization’s 990 can a valuable marketing tool, and the words included on the return are just as important as the numbers.

To make your 990 work for your organization, make sure you take advantage of the space provided to describe significant activities and program service accomplishments.  Do not just use the same narrative every year without making sure it is still relevant.  Include numbers for people served, classes offered, grants made, volunteers, etc.  This is the organization’s opportunity to tell its story.

Form 990 is open to public inspection, which means anyone can get access to your organization’s return (excluding parts of Schedule B).  In order to comply with this requirement, most nonprofit organizations post their 990 on their website.  GuideStar, the National Center of Charitable Statistics and other organizations also provide online databases of 990s that have been filed with the IRS.  With the use of the Internet anyone, anywhere can get access to your 990.

Do you know who is looking at your 990 and why?

Media – To gain additional background information on a specific organization in the news or the nonprofit sector, in general.  They may also look to the 990 to find information on hot topics such as lobbying or executive compensation.

Foundations – To evaluate whether or not to grant money to a specific organization or to make sure an organization is spending awarded grant funds properly.

Donors/Potential Donors – To determine if their gifts are being spent as intended or to determine if the organization is one that they want to support.

IRS and State Government – To check on tax compliance.

Researchers/Watchdog Groups (Charity Navigator, Better Business Bureau’s Wise Giving Alliance, American Institute of Philanthropy, etc.) – To see if an organization is in compliance with federal and state laws and to develop nonprofit best practices.

Prospective Board Members – To determine if the organization is a financially stable and well managed organization that they would want to serve.

Other Nonprofits – To compare budgets, funding sources, expenses and allocations, executive compensation, and programming. 

What story does your 990 tell to these groups?  Does it make your organization shine?   

Posted by: Carrie Minnich, CPA

Posted in Mission Minded Nonprofits

Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.

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