Guidance - Public Inspection of Unrelated Business Income Tax Returns

The IRS has released interim guidance on a new requirement that section 501(c)(3) organizations that file unrelated business income tax returns (Forms 990-T) make those returns available for public inspection and copying. Taxpayers may rely on this notice to comply with the new requirement until regulations are revised.

Notice 2007-45, as modified by Notice 2008-49, clarifies several issues:

  • Generally, all organizations that file Form 990-T must make the return public, regardless of whether the organization is otherwise subject to the public disclosure requirements. For example, churches that file Forms 990-T are subject to this requirement.

  • The disclosure requirement applies to state colleges and universities (and their wholly-owned subsidiaries) that receive determination letters confirming that they are exempt under section 501(c)(3). It does not apply to institutions that are subject to unrelated business income tax solely by virtue of Code section 511(a)(2)(B), however.

  • The guidelines on making annual returns available, set forth in section Treas. Reg. section 301.6104(d)-1 generally apply, except that the definition of annual information return includes an exact copy of the Form 990-T filed by a charity with the IRS after August 17, 2006, including any schedules, attachments, and supporting documents that relate to the imposition of tax on the unrelated business income of the charitable organization.
  • Schedules, attachments, and supporting documents filed with Form 990-T that do not relate to the imposition of unrelated business income tax are not required to be made available for public inspection and copying. For example, Form 5471 and Form 8886 are not required to be made available for public inspection.

  • Charities that make Form 990-T widely available in accordance with Treas. Reg. section 301.6104(d)-2  do not need to comply with an individual request for a copy of the return, although they must make it available for public inspection.
  • The provisions of Treas. Reg. section 6104(d)-3 apply to a request for a charity's Form 990-T that is part of a harassment campaign.