Lee Rosenbaum, the ever-vigilant cultural journalist and author of CultureGrrl, wrote today about the new 990 tax forms, released on Dec. 20, that all nonprofit organizations are required to submit to the Internal Revenue Service.
The new forms, as Rosenbaum notes, come as Congress is investigating abuses by top administrators at the Smithsonian Institutes and the National Museum of the American Indian.
As one prominent commentator, nonprofits tax attorney and accountant Jack Siegel, has already observed (see below), this increased transparency and accountability will make nosey reporters like me happy.
Indeed, it’s true.
The old 990 forms were structured in such a way that all manner of cooking the books could be hidden from view. As a daily reporter covering arts and culture for a Georgia newspaper, I was more than once stumped when it came time to corroborate claims made by arts organization with the paperwork they submitted to the federal government.
Establishing accountability, moreover, could be very problematic. Does the administrator have the final call or is the board of directors, members of which are often selected by the top administrator, ultimately responsible? More transparent federal documents therefore would go a long way in revealing accountability.
The public has a right to know how a nonprofit is spending its money, especially if that money comes from public coffers. The public also has the right to know where money comes from. Many of the country’s wealthiest one percent of the top one percent are using arts nonprofit as a tax shelter. So new, more transparent tax forms are indeed a boon to nosy journalists. But they are good for everyone, including arts organizations that rely on credibility and philanthropy.
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