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March 31, 2023
2023-0636

EY-annotated Form 990-T highlights changes to 2022 Form and instructions

EY has prepared an annotated version of the 2022 Form 990-T (Exempt Organization Business Income Tax Return) and instructions. These annotated documents (which are attached) show what changes the IRS has made to the form and instructions for tax year 2022, and highlight and explain changes to the form and instructions from tax year 2021.

Most of the changes to the 2022 Form 990-T and instructions are relatively minor clarifications and updates. Some of the more significant changes include:

  1. Page 1, Block G: The 2022 form now includes a check box for "state college/university" as an organization type.
  2. The instructions note that the Inflation Reduction Act of 2022 (IRA) imposed a corporate alternative minimum tax (CAMT) under IRC Section 55. For tax years beginning after 2022, applicable corporations within the meaning of IRC Section 59(k), including tax-exempt organizations whose annual income exceeds a certain threshold, may be required to pay an alternative minimum tax.
  3. The instructions explain some of the new tax credits available to tax-exempt organizations under the IRA, including the clean energy investment and production credits (allowed as general business credits on Form 990-T).
  4. The instructions note that the NAICS (North American Industry Classification System) codes, used for classifying and separately reporting separate unrelated trades or businesses on Form 990-T, were revised in 2022.
  5. The instructions explain how an exempt organization that discontinues an unrelated trade or business activity needs to suspend NOLs from that activity if the organization does not conduct any other unrelated trades or businesses within the same NAICS silo as that activity.

Implications

These relatively minor updates to the 2022 Forms 990-T and instructions continue to reflect and explain changes to federal tax laws and guidance affecting tax-exempt organizations. Tax-exempt organizations should continue to carefully review the instructions when completing Form 990-T, particularly in regards to UBTI siloing, and confirm that reporting complies with federal tax law.

Please contact your Ernst & Young LLP tax professional with any questions.

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Contact Information
For additional information concerning this Alert, please contact:
 
Exempt Organization Tax Services
   • Steve Clarke (stephen.clarke@ey.com)
   • Melanie McPeak (melanie.mcpeak@ey.com)
   • Austin Bailey (austin.l.bailey@ey.com)
   • Morgan Moran (morgan.moran@ey.com)
   • Cal Hoke (cal.hoke@ey.com)

Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor

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ATTACHMENTS

2022 Form 990-T and Sch A Annotated

2022 Form 990-T Annotated Instructions

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

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