IRS Form 990 Changes: What Nonprofits Need to Know in 2026

Nonprofit organizations are facing increased scrutiny from the IRS, and several updates to Form 990 reporting requirements are expected to impact how exempt organizations report financial activity, governance practices, grants, and operational transparency.

At Kamish & Associates CPA Firm, we want nonprofit leaders to stay informed and prepared before filing season arrives.

What Is Form 990?

Form 990 is the annual informational return filed by most tax-exempt organizations. It gives the IRS and the public insight into a nonprofit’s finances, governance structure, executive compensation, program accomplishments, and compliance practices.

Because Form 990 is publicly available, it also serves as a transparency tool for donors, grantors, and regulators.

What Changes Are Being Proposed?

The Treasury Department and IRS recently announced plans to revise Form 990 to strengthen oversight of tax-exempt organizations and improve reporting transparency.

While final regulations have not yet been released, the IRS has indicated several areas of focus:

1. Increased Transparency Requirements

The IRS is expected to require more detailed disclosures involving:

• Government grants and contracts

• Fiscal sponsorship arrangements

• Sources of funding

• Relationships with related organizations

• Operational control and governance practices

The goal is to improve visibility into how nonprofit organizations receive and use funds.

2. Greater Focus on Governance

Organizations should expect heightened attention on governance policies and board oversight.

This may include expanded questions involving:

• Conflict of interest policies

• Board independence

• Compensation approval procedures

• Internal controls

• Oversight of fundraising activities

The IRS has increasingly emphasized that strong governance practices reduce the risk of misuse of tax-exempt status.

3. Enhanced Reporting of Related Entities and Transactions

Nonprofits with related organizations, partnerships, or complex organizational structures may see additional reporting requirements.

Organizations may need to provide more detail regarding:

• Transactions with related entities

• Shared employees or management

• Joint ventures

• Program-related investments

• Fiscal sponsorship arrangements

Many of these disclosures are already addressed through schedules attached to Form 990, but the IRS appears to be moving toward more comprehensive reporting standards.

4. Continued Emphasis on Electronic Filing

The IRS continues enforcing mandatory electronic filing requirements for most Form 990 series returns. Organizations filing incomplete or incorrect returns risk rejection and possible penalties.

Why These Changes Matter

For nonprofit organizations, Form 990 is no longer simply a compliance document. It is often reviewed by:

• Donors

• Granting agencies

• State regulators

• Charity watchdog organizations

• Financial institutions

• Potential board members

Incomplete reporting or governance weaknesses can raise concerns about transparency and accountability.

The IRS has also reiterated that organizations failing to file required returns for three consecutive years can automatically lose their tax-exempt status.

How Nonprofits Can Prepare

Now is the time for nonprofit organizations to strengthen internal processes before these changes become finalized.

We recommend organizations:

• Review governance policies and board procedures

• Ensure accurate bookkeeping throughout the year

• Document grants, sponsorships, and related-party transactions carefully

• Maintain detailed records supporting compensation decisions

• Evaluate internal financial controls

• Work with an experienced nonprofit CPA firm before filing season

How Kamish & Associates Can Help

At Kamish & Associates CPA Firm, we work closely with nonprofit organizations to help them remain compliant, organized, and prepared for evolving IRS requirements.

Our team can assist with:

• Form 990 preparation and review

• Nonprofit bookkeeping and accounting

• Governance and compliance guidance

• IRS correspondence and compliance support

• Financial statement preparation

• Strategic nonprofit advisory services

If your organization has questions about upcoming Form 990 changes or wants assistance preparing for future reporting requirements, our team is here to help.

Contact Kamish & Associates today to schedule a consultation.