This session comprises one of four Form 990 Master Classes available to those wanting intermediate-to-advanced training on topics that comprise the 990's most difficulty arenas. The two public support tests have been utilized since the finalization of Regulations to the 1969 statutory changes that subdivided the 501(c)(3) world into “private foundations†and “public charities.†The tests’ application remains murky to most preparers (even though they have been in existence, virtually unchanged, for decades). This session has two key goals: first, ensuring that participants understand the design, reach, and purpose of each test; and second, making practitioners conversant (with the materials as back-up) h of each test's line-by-line inputs. While it is impossible "to have fun" with these tests, participants will walk away knowing where pressure points exist and how those vary depending on an organization's specific successes or gaps in achieving diversity of so-called "public support." What is possible and achievable from this session is that these tests can be mastered! Although this course is categorized as "Intermediate", the content is also suitable for those seeking advanced-level training. This event may be a rebroadcast of a live event and the instructor will be available to answer your questions during the event.
Learning Objectives
After attending this presentation you will be able to...
- Identify the specific revenue streams that inform the first public support test's numerator and denominator as well as the limit on certain "non-public" donors' dollars applicable to this test
- Appreciate the relative ease of this PST #1’s percentage calculation, and the flexibility by which qualification applies either automatically or alternatively via facts and circumstances
- Identify the additional revenue stream factored into the second public support test’s numerator and denominator; as well as the complex limitations that apply when calculating PST #2 numerator
- Recognize that the second public support test should only be used for filers who cannot pass via the first test (for this purpose only, the objective is to understand how the second public support test's limitations and disparate donor categories, as well as its added percentage test, effectively limit this test's utility as well as add to its complexity)
Major Topics
The major topics that will be covered in this class include:
- Intro to the two public support tests (PSTs), including the various common misconceptions about each test's application
- Review of each test, focusing first on the relative ease of PST #1 (that calculated on Schedule A, Part II) which employs a bifurcated test (i.e., an automatic %-age versus a 'facts and circumstance' %-age “inâ€); thereafter, emphasizing the demands and challenges of PST #2 (calculated on Schedule A, Part III) with its restrictive parameters and dual tests each of which must be passed to be “inâ€
- Practical tips (and materials on same) translating revenue presentation from the Core Form 990 at Part VIII to the line inputs for both PSTs via Schedule A's Parts II and III
- Discussion of how to assist organizations who are in danger of flunking one or both PSTs
- Analyzing anomalies: explanation of both what comprises an unusual grant and when a filer's PST 1 "facts and circumstances test" argument ages out
