Every year in the United States approximately 1.5 million registered tax-exempt organizations file a version of the “Form 990” with the IRS and state tax authorities. While the questions vary between the version for private foundations or small nonprofits, the 990 collects details on the financial, governance and organizational structure of America’s universities, hospitals, foundations, and charities to the end of ensuring that they are deserving of tax exempt status. These organizations, which together pay $670 billion in wages and benefits annually, create America’s education, culture, art, religion, science, and provide many of the social services upon which our communities depend.
With a national movement in the U.S. to shrink the role of government, non-profits may be expected to expand their programs as they step in to fill essential needs. The role of nonprofits may now become even greater – and deserving of greater scrutiny.
The data that the IRS collects about nonprofit organizations present a great opportunity to learn about the sector and make it more effective. Yet this data could be made far more useful than it is today. It’s time to “liberate” 990 data and make it easier to gain insight into the workings of America’s nonprofits.For more, see Noveck and Goroff, Information for Impact: Liberating Nonprofit Sector Data. Link (PDF)