Form 1023: Tax Periods for Which Statement of Revenue and Expenses Is Required

 

For what periods must the Statement of Revenue and Expenses in Part VI be completed?

The tax years for which financial information must be provided for the Statement of Revenues and Expenses in Part VI depends on the number of tax years an applicant has completed since it was formed. An organization’s tax year is its annual accounting period.

The following examples explain how to determine the number of years an organization has completed since it was incorporated or formed.

Example 1: X was incorporated as a nonprofit organization on June 4, 2018.  It selected an annual accounting period that ends December 31.  Therefore, its first tax year is June 4, 2018 through December 31, 2018.  Its second tax year is January 1, 2019 through December 31, 2019.  Its third tax year is January 1, 2020 through December 31, 2020. Its fourth tax year is January 1, 2021 through December 31, 2021.

Example 2:  Y was formed as a trust on June 4, 2018.  It selected an annual accounting period that ends June 30.  Therefore, its first tax year is June 4, 2018 through June 30, 2018.  Its second tax year is July 1, 2018 through June 30, 2019.  Its third tax year is July 1, 2019 through June 30, 2020.  Its fourth tax year is July 1, 2020 through June 30, 2021.

If an organization has been in existence for less than 5 years, it must complete the schedule in Part VI for each year in existence and provide projections of likely revenues and expenses based on a reasonable and good faith estimate of future finances for a total of:

  1. Three years of financial information if it has not completed one tax year, or
  2. Four years of financial information if it has completed one tax year.

If in existence for 5 years or more, it must complete the schedule for the most recent 5 tax years.