How to Fill Out Form 990-PF for 2022. Step-by-Step Instructions for a Private Foundation

The IRS Form 990-PF is filed by a private foundation to report its income & expenses, charitable distributions and activities, and calculate taxes owed on its net investment income.

In this example, we cover an initial year return for a Florida non-operating private foundation funded by a Florida resident. Some of the main discussion points include the following:

1. Taxes on investment income. Non-operating foundations are not totally tax exempt. They must pay a 1.39% tax on net investment income. The foundation can deduct investment management fees and, in some cases, an allocation of other foundation operating expenses.
2. Minimum Investment Return & Distributable Amount. The foundation calculates its minimum investment return based on the FMV of foundation assets. Generally, a foundation must make charitable expenditures equal to or greater than 5% of its assets.
3. Schedule B Disclosures for Substantial Contributors. Schedule B is required to disclose all persons or entities that make contributions of cash or other noncash property, if those contributions exceed $5,000 during the year.

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