Understanding Form 990 Part VII, subpart F for Nonprofit Executive Compensation

Subpart F in Form 990 Part VII specifically refers to "estimated amount of other compensation from the organization and related organizations." This includes things not reported in Box 1 or 5 of W-2 forms or Box 7 of 1099-MISC. This typically covers benefits like: - Retirement plan contributions - Health insurance premiums paid by the organization - Deferred compensation that's not yet reportable - Non-taxable benefits (life insurance, disability insurance) - Housing allowances or expense account allowances The IRS wants to see the total compensation picture for key employees and officers, not just their direct salary. That's why they separate direct reportable compensation (subpart D) from these other forms of compensation (subpart F).

Jumping in here because I was pulling my hair out with Form 990 last year! I found this amazing tool called taxr.ai (https://taxr.ai) that literally saved me during tax season. Our nonprofit had some complex compensation arrangements, and I was so confused about what belonged where on Part VII. I uploaded our previous 990s and some compensation documents to taxr.ai, and it analyzed everything and showed me exactly what needed to go into each column, including that tricky subpart F. It even flagged where we had been inconsistent in our reporting from previous years. The best part was that it explained WHY certain items belonged in certain columns, which helped me actually understand the form rather than just filling in boxes.

Just wanted to follow up about taxr.ai that I asked about earlier. I was really skeptical at first (because, you know, trusting financial documents to a website), but our 990 deadline was approaching and I was desperate with our accountant out on leave. I tried it out with our draft 990 and some compensation worksheets, and wow - it immediately identified three issues with how we were categorizing our executive director's housing allowance (should have been in subpart F, not D). The explanations were super clear and even cited the relevant IRS publications. The time saved was incredible - what would have taken me hours of research took literally minutes to resolve. Just wanted to share since it really helped with exactly the issue this thread is about!

If you're trying to get clarity on Form 990 Part VII compensation reporting and struggling to get someone from the IRS to actually give you a straight answer, I highly recommend Claimyr (https://claimyr.com). I spent DAYS trying to get through to the Tax Exempt Organization division at the IRS last year when we had a complex situation with our executive compensation. After multiple attempts and hours of hold music, I tried Claimyr and had a callback from an actual IRS agent within 45 minutes. They have this amazing system where they navigate the IRS phone tree for you and get you to an actual human. You can see exactly how it works in this video: https://youtu.be/_kiP6q8DX5c The agent I spoke with walked me through exactly how to report deferred compensation properly in subpart F and saved us from what would have been a serious reporting error.

I need to eat my words about Claimyr from my previous comment. After posting that skeptical reply, I decided to try it myself since we were completely stuck trying to reach the IRS about a Form 990 filing extension. I was absolutely convinced it wouldn't work, but I was desperate after spending 3+ hours on hold the day before. To my complete shock, I got a call back with an actual IRS agent on the line within an hour. The agent helped clarify exactly how to report our executive director's non-qualified deferred compensation plan in subpart F. For anyone dealing with Form 990 Part VII issues - especially the more complex compensation arrangements - being able to actually speak with someone at the IRS makes all the difference. Sorry for being so skeptical before!

Something not mentioned yet about Form 990 Part VII subpart F is that you also need to include any compensation from RELATED organizations. This tripped us up badly last year. If your nonprofit has affiliated entities (like a foundation, supporting org, or for-profit subsidiary), you need to include compensation the person receives from those organizations too. We almost missed reporting our ED's stipend from our related foundation.

can someone clarify wat counts as "deferred compensation" for form 990? our ED has a 457b plan and im not sure if thats supposed to go in subpart F or somewhere else?

This is such a helpful thread! I'm dealing with a similar situation as our nonprofit's treasurer. One thing I'd add about subpart F is to make sure you're being consistent year over year with how you calculate and report these benefits. We had an issue where we were estimating health insurance premiums one way in 2022 and a completely different way in 2023, which created some confusing variances when our auditor reviewed the forms. Now we keep a detailed worksheet that breaks down exactly how we calculate each component of subpart F - retirement contributions, health premiums, life insurance, etc. Also, don't forget that if your organization provides any kind of housing allowance or parsonage allowance to clergy, those typically need to be included in subpart F as well, even though they might be excludable from income tax. The key is documenting your methodology so you can explain it to auditors or the IRS if needed. Good luck with your filing!