Decoding the 990: Your Museum's Financial Roadmap

Caught red-handed! 🙈 It might feel like peeking behind the curtain or into a diary, but Form 990 is crucial for understanding how nonprofit museums use their funds.

Have you ever wondered how museums allocate their funds? Are you curious about where your donations go? If so, it's time to delve into the world of 990s.

What is a 990?

A 990 is a financial report that nonprofit organizations must file with the IRS. It provides a detailed snapshot of the organization's finances, including its income, expenses, assets, and liabilities. Think of it as the annual report card for nonprofits.

Why are 990s important?

• Transparency: 990s provide transparency into how nonprofits use their funds. Donors and the public can use this information to make informed decisions about supporting organizations.

• Accountability: 990s help ensure that nonprofits are using their funds for their stated mission and not engaging in any illegal or unethical activities.

• Tax Exemption: Nonprofits must file 990s to maintain their tax-exempt status.

How to read a 990:

While 990s can be complex, understanding the key sections can provide valuable insights:

1. Part I: Basic Information: This section includes the organization's name, address, and contact information.

2. Part III: Statements of Program Service Revenue, Expenses, and Assets: This section details the organization's primary activities and how it spends its money.

3. Part IV: Schedule A: This section provides information about the organization's compensation for its officers and directors.

4. Part V: Statements of Functional Expense: This section breaks down the organization's expenses by program, management, and fundraising activities.

Where can you find 990s?

You can find 990s for most nonprofits on the IRS website (irs.gov). Simply search for the name of the organization you're interested in.

By understanding 990s, you can become a more informed and engaged supporter of nonprofit museums. So, next time you're curious about how your favorite museum is using its funds, take a look at their 990!