Seeking greater transparency into the workings of tax-exempt organizations including charities, Sens. Chuck Grassley, R-Iowa, and Max Baucus, D-Mont., of the Senate Committee on Finance are urging the Treasury Secretary to update the IRS tax form used by the not-for-profit sector.
The senators made their request in a letter sent May 29. They urged the Treasury Department to make gathering more and better information a top priority and to pay particular attention to the operational complexities of not-for-profit hospitals and universities.
“While we always hear that sunshine is the best disinfectant, sunshine can’t do its work unless we open the blinds,” Grassley and Baucus wrote. “The sooner we open those blinds, the better.”
Their particular concern centers on Form 990 and Form 990PF, which charities file with the IRS--specifically, that Form 990 has not kept up with modern practices in the charitable sector and needs significant updating. The senators said they “view it as vital” that the IRS include supplemental information requests for major subsectors of the charitable field, because large, complex institutions, such as hospitals and universities, require more detailed questions tailored to the specifics of their fields if transparency and openness are to have real value.
Particular issues that Baucus and Grassley believe are in critical need of greater reporting and transparency are executive compensation, endowments, related organizations, joint ventures, governance, dollars raised versus dollars for charity, and hospitals. Read the letter.
