Receiving a letter from the IRS is a common source of anxiety. The instinct to set it aside and hope it goes away is understandable—but it is also the worst possible response. IRS notices carry deadlines, and missing them can result in penalties, loss of appeal rights, or enforced collection action. This guide explains the most common types of IRS notices, what they mean, and how a CPA can help resolve them. Common Types of IRS Notices CP2000: Proposes changes to a return based on information reported by third parties (employers, banks, brokers). Often results from unreported income or incorrect withholding. CP501/CP503/CP504: Collection notices for unpaid balances. Each escalates in urgency. CP90/CP297: Final notices of intent to levy before seizure of assets. Audit Notices: Inform you that your return has been selected for examination. What to Do First Do not ignore the notice. Read it carefully to determine what the IRS is asking for and the deadline for response. Many notices can be resolved with a simple written response or documentation. If the notice proposes additional tax, do not assume the IRS is correct. Errors in IRS records are common, particularly with information matching. How a CPA Helps A CPA with unlimited representation rights (such as a Certified Public Accountant) can act as your authorized representative before the IRS. This means the CPA communicates with the IRS on your behalf, responds to notices, and negotiates resolutions. Resolution options include: Penalty abatement for reasonable cause Installment agreements to pay over time Offers in compromise to settle for less than the full amount Currently not collectible status for temporary hardship The Taxpayer Bill of Rights The IRS Taxpayer Bill of Rights guarantees the right to be informed, the right to quality service, the right to challenge the IRS’s position, and the right to retain representation. A CPA exercises these rights on your behalf. How Nova Tax & Accounting Services Can Help Nova Tax & Accounting Services provides IRS representation and tax resolution services for individuals and businesses across Virginia and Washington DC. Our CPAs handle notices, audits, and collection matters. For more information, visit https://novataxservices.com/ or schedule a free consultation. Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Tax laws are subject to change, and individual circumstances vary. Consult a qualified tax professional for advice regarding your specific situation.
Form 990 is not merely an annual filing obligation. It is the most public document a nonprofit organization produces. Donors, grantors, watchdog organizations, and the IRS use Form 990 to evaluate an organization’s finances, governance, and program activities. Errors or omissions can damage donor confidence, trigger IRS scrutiny, and jeopardize tax-exempt status. This guide explains the Form 990 filing requirements, the schedules that accompany it, and how to prepare accurately. Which Form Does Your Organization File? The specific form depends on gross receipts and total assets: Form 990-N (e-Postcard): For organizations with gross receipts normally $50,000 or less. Filed online; no paper equivalent. Form 990-EZ: For organizations with gross receipts under $200,000 and total assets under $500,000. Form 990: For organizations with gross receipts of $200,000 or more or total assets of $500,000 or more. Form 990-PF: For private foundations, regardless of revenue level. Filing Deadline Form 990 is due by the 15th day of the 5th month after the end of the organization’s tax year. For calendar-year organizations, this is May 15. A six-month extension is available by filing Form 8868 . Failure to file for three consecutive years results in automatic revocation of tax-exempt status. Key Schedules Form 990 includes several schedules that must be completed based on the organization’s activities: Schedule A: Public Charity Status and Public Support Schedule B: Schedule of Contributors Schedule D: Supplemental Financial Statements Schedule G: Fundraising Activities Schedule I: Grants and Assistance Schedule J: Compensation Information Schedule L: Transactions with Interested Persons Schedule O: Supplemental Information Governance Disclosures Part VI of Form 990 asks about the organization’s governance policies, including conflict of interest policy, whistleblower policy, document retention policy, and board review of the return. Organizations with strong governance disclosures face lower audit risk. The IRS Stay Exempt Program The IRS provides resources for exempt organizations through its Stay Exempt program, including web-based mini-courses for new and existing tax-exempt organizations. The Taxpayer Advocate Service also offers guidance on electronic filing requirements for 501(c) organizations . How Nova Tax & Accounting Services Can Help Nova Tax & Accounting Services specializes in Form 990 preparation for tax-exempt organizations across Virginia and Washington DC. Our team ensures accurate, timely filings that reflect your mission and maintain compliance with IRS requirements. For more information, visit https://novataxservices.com/ or schedule a free consultation. Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Tax laws are subject to change, and individual circumstances vary. Consult a qualified tax professional for advice regarding your specific situation.
There are approximately 57 million small businesses and self-employed taxpayers in the United States, including corporations and partnerships with assets under $10 million, sole proprietors, independent contractors, and gig workers . For all of them, accurate filing and recordkeeping are the foundation of tax compliance and financial health. The Taxpayer Advocate Service (an independent organization within the IRS) published updated guidance in May 2026 outlining small business filing and recordkeeping requirements . This guide summarizes the key points. Filing Requirements by Entity Type The federal tax forms a business must file depend on its entity type : Sole Proprietor Income Tax: Form 1040/1040-SR, Schedule C or F Self-Employment Tax: Form 1040/1040-SR, Schedule SE Estimated Tax: Form 1040-ES Employment Taxes: Forms 940 and 941, 944, or 943 Partnership Annual Return of Income: Form 1065 Partner’s Income Tax: Form 1040/1040-SR, Schedule E Corporation (C or S) C Corporation Income Tax: Form 1120 S Corporation Income Tax: Form 1120-S Estimated Tax: Form 1120-W (C-Corp only) S Corporation Shareholder Income Tax: Form 1040/1040-SR, Schedule E Recordkeeping Requirements The Taxpayer Advocate Service emphasizes that good records can assist in preparing financial records, tracking property and deductions, knowing where to target funding, and reducing expenditures to optimize profit . At a minimum, records should track: Gross Receipts: All income from business operations Inventory: Including any merchandise withdrawn from sale for personal use Expenses: All costs incurred in running the business The IRS provides several publications to assist small businesses, including Publication 334 (Tax Guide for Small Business), Publication 583 (Starting a Business and Keeping Records), and Publication 463 (Travel, Gift, and Car Expenses) . Estimated Tax Payments If you expect to owe self-employment tax of $1,000 or more** for 2026, you may need to make estimated tax payments using Form 1040-ES . For 2026, the maximum amount of self-employment income subject to Social Security tax is **$184,500 . Small business owners and self-employed individuals should calculate their estimated payments carefully to avoid underpayment penalties. The Value of Professional Guidance The Taxpayer Advocate Service notes that the federal tax forms vary depending on business type, and that small business taxpayers should understand their filing requirements to file accurate returns . A qualified CPA can help you determine which forms apply to your business, set up a recordkeeping system, and calculate estimated tax payments accurately. How Nova Tax & Accounting Services Can Help Nova Tax & Accounting Services provides tax preparation, bookkeeping, and advisory services for small businesses across Northern Virginia and Washington DC. Our CPAs help business owners meet their filing obligations, maintain accurate records, and plan for estimated tax payments. For more information, visit https://novataxservices.com/ or schedule a free consultation. Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Tax laws are subject to change, and individual circumstances vary. Consult a qualified tax professional for advice regarding your specific situation.