Form 990: Potential Upcoming Changes and What They Mean for Nonprofits 

July 17th, 2026 | BY Brandy Mikula | Accounting | Consulting | Nonprofit
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The U.S. Department of the Treasury is evaluating the first major update to Form 990 in nearly two decades. While proposed regulations have not yet been released, early indications suggest a move toward greater transparency, enhanced reporting, and increased oversight for tax-exempt organizations. Nonprofits that receive government funding or serve as fiscal sponsors may experience the most significant impact.  

Key Areas of the 990 Under Consideration  

Not all parts of Form 990 are going to go through change. However, it’s important to know which areas are under consideration, as they may affect your organization more than others. 

1. Government Funding Reporting  

Potential revisions may require nonprofits to provide more detailed information about:  

  • How government grants and contracts are used  
  • Allocation of funds across specific programs  
  • The purpose and source of public funding  

This would expand beyond current requirements, which identify government grants but do not require detailed spending breakdowns.  

2. Fiscal Sponsorship Transparency  

Treasury has signaled increased scrutiny of fiscal sponsorship arrangements. Future reporting may require organizations to disclose:  

  • Who operates sponsored projects  
  • Who controls the related funds  
  • How those funds are used  

These changes aim to strengthen accountability and reduce risks of misuse of charitable assets.  

Which Organizations Are Most Likely to Be Affected? 

Nonprofits that are likely to experience the biggest impact from the potential 990 changes include organizations that:  

  • Receive government grants  
  • Hold government contracts  
  • Serve as fiscal sponsors  

These organizations may face the most substantial new obligations and updates to reporting regulations.  

Why Are Form 990 Changes Being Considered?  

Federal agencies increasingly expect detailed reporting on the use of public funds. Treasury is evaluating whether Form 990 should align more closely with these expectations to improve transparency, stewardship, and public trust across the nonprofit sector.  

How Your Organization Can Prepare  

  • Review grant-tracking systems to ensure that documentation clearly identifies the source, purpose, and use of government funds
  • Enhance internal reporting to prepare for potential requirements to show how specific dollars are spent
  • Evaluate fiscal sponsorship arrangements for clarity around project operations and fund control
  • Confirm alignment with exempt purpose across all programs and funding streams
  • Assess accounting and compliance systems to determine whether they can support more detailed reporting

Is Your Nonprofit Ready for Change? Maner Costerisan Can Help 

Treasury is expected to release proposed regulations, followed by a public comment period. No implementation timeline has been announced. Preparing now will help ensure your organization is ready once changes are finalized.   

Maner’s nonprofit tax specialists can help you prepare for changes and assess the health of your organization to be sure that your organization is in a good place for the 990 changes on the way. Contact us today to learn more about how we can support your team.