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Public Records Research: Investigating People, Businesses and Nonprofits: Nonprofits

Probing Nonprofit Organizations

Here are some resources for finding 990 forms, and investigating nonprofits:

CitizenAudit (see J-School secure logins page) searches within the full text of charity IRS 990 forms. Full-text searching means you can search the whole universe of documents for one name or company.

ProPublica's Nonprofit Explorer search the full text of nonprofit 990s.
GuideStar (we do not have a premium account) view charity IRS 990 forms
Charity Navigator good financial evaluations of nonprofits

Look for State Regulatory Agency like NYS Charities Bureau Registry, which includes a charity registry and transaction search

If the nonprofit has a contract with a public agency, performance and financial audits may exist. Find or file a Freedom of Information Request for audits and reports.

America’s Worst Charities: database of disciplinary records of regulatory actions taken by states against charities and solicitors, from Tampa Bay Times and the Center for Investigative Reporting

Better Business Bureau Wise Giving Alliance

Search public reviews on Great Nonprofits 

Foundation Center

The Philanthropy 50 - america’s Top Donors, Chronicle of Philanthropy. Additional data sets form COP.

Most tax-exempt nonprofit organizations must file a public financial document with the IRS called a form 990.

Highlights of IRS Form 990, Guidestar

Below is an excerpt from Information for Impact: Liberating Nonprofit Sector Data By Beth Simone Noveck and Daniel L. Gorof, The Aspen Institute  (page 54 of report, pg 60 of pdf)

Breakdown of the Form 990

The core Form 990 requests information on the following:

1. Basic facts about the filer

2. What kind of programs does the filer run and how much does it spend on them?

3. Who are the filer’s board members and how does the filer govern itself?

4. Did the filer change in any significant way during the year?

5. How much income did the filer receive and from what sources?

6. What did the filer spend its money on?

7. How much do top earners get paid and salary information

8. Did the filer engage in any insider or excess benefit transactions during the year?

9. Basis for public charity status (if a charity)

10.Does the filer lobby or exercise the 501(h) election?

 

What to Look for on a Nonprofit's Form 990s filing:

"Page 8, Section B - Outside Contractors: Nonprofits are required to report their five most highly compensated outside contractors receiving more than $100,000. This information is often useful not only because it contains names and addresses that can advance your reporting, but it includes a (brief) description of the services provided (such as "media placement"). Though only the top five contractors are listed, section B.2 requires the organization list the total number of contractors paid more than $100,000." From What Information is Important on Form 990s?, Robert McGuire, Center for Responsive Politics, OpenSecrets.org


"Nonprofits don't disclose who gives to them, but they do disclose who they give to. CitizenAudit…should find almost all nonprofit-to-nonprofit grants. This technique won't tell you what companies and individuals are funding nonprofits, unless they're routing it through trusts, etc."

"Use 990s for Routine Backgrounding: 990s are thorough disclosures. It's a chance to get paper on someone, more than you'll see in limited forms like incorporation documents. If you're backgrounding anyone who's been active in the community, there's a decent chance they'll show up. Get in the habit of doing it even when your story has nothing to do with tax-exempt organizations. Nonprofits can be shadow/sister organizations to companies and other groups. They can sometimes have almost no real-world presence, but search an address or a person's name and they may have one there." From Searchable form 990s with citizenaudit.org, by Luke Rosiak


"Pages 3 and 4: The kitchen sink Look for “Yes” answers on these pages; in virtually every case, a “Yes” means the nonprofit must file an extra schedule. If the topic is even marginally interesting, make sure you read that schedule. My personal favorite is Line 25, which asks about any “excess benefit transaction with a disqualified individual” – translation: large payments to insiders."

"Pages 7 and 8: Who gets the big bucks  (See Lines 5 and 6 on Page 1.)... two good questions to ask: How well does a particular organization pay compared with similar organizations? And how well does a particular executive’s compensation match his or her performance or (if new on the job) the challenges he or she must overcome?" From Digging into Nonprofits: IRS Form 990, by Ronald Campbell, The Orange County Register via Syracuse University

"Part IV Question 26: did the organization provide a loan to a key employee, trustee, etc.?; Question 27: did the organization provide a grant to a key employee, trustee, etc.?; Question 28:  'related business transactions' (has the organization been paying a brother, mother, sister, etc.?); (Checklist starts on page 3 of the Form 990, Part IV)"

"Part VII Question 2: do any of the board members have a family or business relationship?; Question 6: 'significant diversion of assets' - losses attributed to theft, investment fraud, embezzlement and other unauthorized uses of funds in excess of $250,000 or 5 percent of gross receipts; (Starts on page 6 of the Form 990, Part VII)” Mining Nonprofit Data, Kendall Taggart, Center for Investigative Reporting, from NICAR 2014 


"Pages 7-8: Lists compensation of officers, directors, trustees, key and highest paid employees and independent contractors" The Big Business of Nonprofits, by Marni Usheroff, columbia University Graduate School of Journalism


"In its standards of accountability, the Better Business Bureau says an organization should spend at least 65 percent of total expenses on programs. Program expenses are allowed to include some salary, overhead and fundraising costs to the extent those activities promote the charity's programs." How to dig deeper into a nonprofit’s finances, Center for Investigative Reporting


"Observe the contributions made or grants and similar amounts paid. This amount is the total amount that the foundation gave in the past year to nonprofits. This is key to any profile—foundations are required to give 5 percent of their assets. Some foundations give a lot more than that while others stick to the minimum." 7 Tips for Reading the Form 990, by Elisa Shoenberger, Loyola University Chicago, via Council for Advancement and Support of Education 


This is a very in-depth read of info you can find in 990s:  How to Read the IRS Form 990, from the  Nonprofit Coordinating Committee of New York, Inc.

More Guides on using 990s for reporting:

Resources for Investigating Tax-Exempt Organizations from ProPublica

Margot Williams' Tipsheet from the 2015 GIJC 

A data journalist's guide to IRS Form 990s and investigating non-profit organizations from Dan Nguyen

SourceWatch from the Center for Media and Democracy, “encyclopedia of the people, organizations, and issues shaping the public agenda.”

 

Nonprofit Data Search from opensecrets, tracks political activities, financial links and hidden networks of nonprofit groups

 

Conservative Transparency interactive database that tracks the flow of money among conservative donors, organizations, and candidates.

 

Retraction Watch tracks retractions of scholarly articles

This is an excerpt from Information for Impact: Liberating Nonprofit Sector Data By Beth Simone Noveck and Daniel L. Gorof, The Aspen Institute

Illustrative Uses for Open 990 Data (page 25 of the pdf/ page 19 of the actual document)

Here are a dozen “use cases” that illustrate in more detail what might be done with access to computable data from Forms 990s (often in combination with other data). 

Locate expertise and resources

Imagine walking down the street, seeing some homeless people, and using your Smartphone to map out which nonprofits sponsor shelters in this particular neighborhood so you can volunteer. The website Catchafire offers a matching service to connect volunteers to nonprofits, but the organization has to solicit these opportunities manually now. With open nonprofit data, it could use 990s to connect volunteers in a community or online to an organization that matches their interests. Ditto disaster planning, which necessitates identifying sources of social services quickly. And with better 990 data, nonprofits could identify experts who have worked with similar organizations to consult and hire.

Aggregate and compare programmatic expenditure trends

If open, Form 990 data could also be linked to information in other datasets. For example, the NCCS combines Form 990 data with Census Bureau data in its Community Platform. It might be particularly useful to track how programs of a given type or in a given region respond to economic cycles. Johns Hopkins University’s Center for Civil Society Studies does extensive work on tracking the economics of the nonprofit sector. With open data their economic analysis could be significantly improved or, at least, conducted with greater ease and efficiency. 

Identify leaders and their connections

In addition to graphing influence networks as groups, like the Center for Responsive Politics typically does, knowing who runs a nonprofit can also help detect fraud. Hugh Jones, Supervising Deputy Attorney General at the Hawaii Office of Attorneys General, informed us that Attorneys General have occasionally found the same person collecting full time salaries from several different nonprofits. Such discoveries are now made by happenstance. With open data, they could be detected through computer analysis.

Similarly, Form 990 requires charities to disclose loans to or from current and former officers. Transactions like these are illegal in some states, and could be discovered or monitored more easily if the data were readily available and searchable.

Aggregate and compare specific income trends

Knowing more about where certain streams of nonprofit revenue come from could help inform debates about changing the rules for charitable deductions, for example. The USASpending dataset of national government expenditures is open and downloadable, and when mashed up with 990 data could provide revealing insights into whether a “smaller” government is really smaller or simply delegating spending to non-governmental organizations, for example. Code for America — an analog of Teach for America that sends young, tech-savvy innovators to work on local innovation in municipalities — would also be interested in 990 data to help them develop apps that showcase the nonprofits serving particular communities. In other words, they want to use the data to build consumer-friendly tools for visualizing who delivers what service.

Promote transparency and trust

The 990 should be public because public oversight is an important and integral part of our system, reported one official at the Department of Treasury. The whole of charitable deduction rests on the assumption that individual tax payers can make wise decisions about how to best address the charitable issues in their own communities. Concerns raised about fundraising and functional expenditures by nonprofits, for example, cannot all be addressed by calculating simple ratios. Enabling more sophisticated analysis could help distinguish good and bad outliers. The Navy Veteran’s Association scandal 67 demonstrated how hard it could be to detect false claims without an aggregate database that can cross-check 990 filings in different states. In that scandal, a con artist set up a fake Navy Veterans’ charity and collected millions of dollars before he was caught. A database that allows for crosschecking Forms 990 filings across various states would allow regulators to more easily track and investigate organizations that may falsify information on their activities or officers.

Assess financial soundness

Policy makers may want to know how well different parts of the nonprofit sector are doing, and donors may want to know how well different potential recipients are doing relative to comparable parts of the nonprofit sector. With enough data, models can be devised and tested to predict insolvency, which is how GuideStar approached a recent “Data Dive” aimed at creating tools for the sector. Givewell, a charity evaluator that helps donors assess charities for their financial soundness, would be dramatically aided by bulk data downloads.

Track and compare labor statistics

The demand for basic information about nonprofit salaries is strong enough to support commercial suppliers who compile and sell it. 69 With some states proposing legislation to regulate such salaries, access to accurate analysis and statistics can only become even more important. Employment within the nonprofit sector is another important macroeconomic variable that can be deduced by aggregating Form 990 data to use in conjunction with data from the Bureau of Labor Statistics (BLS). The Johns Hopkins University Nonprofit Economic Data Project tracks changes in employment, wages and finances over time and in comparison to other industries using BLS data with 990 data that must now be manually and painstakingly processed. (The Project is a collaboration between the Center for Civil Society Studies, State Employment Agencies and the U.S. Bureau of Labor Statistics, and State Nonprofit Associations.) Given the importance of the nonprofit sector to the country’s overall employment rates — estimates suggest that the nonprofit sector accounts for 10% of the workforce in the U.S. — more useful data about nonprofit employment is especially needed.

Check investment and program alignment

Venture philanthropy is a growing trend in the nonprofit sector. A foundation dedicated to genetic research on a given disease might use better 990 data to search for potential partner foundations that invest in or hold biotech companies in their endowment portfolios. Foundations such as the Michael J. Fox Foundation for Parkinson’s Research provide grants for firms thinking innovatively about medical research. For such foundations, information about the extent to which investments and portfolio holdings mirror mission statements could be presented in a more accessible manner for regulators and donors.

Aid enforcement and regulation

Steven T. Miller, deputy IRS Commissioner, testified before Congress that the agency was “somewhat understaffed” in overseeing nonprofits, especially ensuring that they pay taxes on unrelated business income. Better, more usable data would make enforcement more efficient and effective. For example, checking the box on the Form 990 that asks whether loans have been made to directors or officers should constitute a “red flag” for the Attorney General in any state where that practice is prohibited. Without ready access to specific information about suspicious activity like this, there is a tendency to regulate in broad and heavy-handed strokes based mainly on anecdotes. With a Form 990 database, identifying potential fraud could be crowdsourced, giving the IRS and states’ Attorneys General “more eyes and ears.” As Hugh Jones put it: “Making 990 forms public enlarges the volunteer staff of the IRS.” 

Monitor Lobbying 
Certain regulations restrict how much lobbying and political activity a nonprofit engages in, depending on the type of nonprofit. The Citizens United 73 decision obviously has brought political issues to the fore. The Center for Responsive Politics (CRP) tracks money in U.S. politics and its effects on public policy. CRP manually scrapes a relatively small number of 990s for politically active nonprofits to populate its OpenSecrets website, which tracks which organizations give to whom. “A public source for 990s data,” says Executive Director for the Center for Responsive Politics, Sheila Krumholz, “would be a godsend.” 

Facilitate data “mashups”
Data from totally different sources can often be combined to great effect. Form 990 databases could be combined with mapping data, for example, or with programmatic results data that could help nonprofits gauge their effectiveness in comparison to other similar organizations. Like the current initiatives to create a global system of “legal entity identifiers,” an initiative specifically aimed at numbering nonprofits would enhance such capabilities, as could state efforts to standardize their nonprofit registration procedures. An effort specifically for registering nonprofits is being developed by a foundation-funded consortium under the name Basic Registry of Uniquely Identified Global Entities (BRIDGE).

Facilitate academic and business research
Establishing various baseline values and setting up longitudinal studies may now be especially important given the changes taking place both in and around the nonprofit sector. Statistical frames for constructing representative survey samples, for example, depend on having comprehensive data about the nonprofit sector as a whole. More specifically, the Urban Institute could use computable 990 data to pursue its interest in understanding the mix of nonprofit institutions that exist in low-income neighborhoods; the relationships between the level and mix of neighborhood-level nonprofits; and conditions and trends in those neighborhoods. In fact, the academic study of the nonprofits has become so important that Indiana University is building on the research experience of its Center on Philanthropy to launch the nation’s first School of Philanthropy.