The IRS hopes to have the form ready for use for the 2008 filing year (early 2009).

"The tax-exempt sector has changed markedly since the Form 990 was last overhauled more than a quarter of a century ago," said Kevin Brown, acting commissioner of the IRS. "We need a Form 990 that reflects the way this growing sector operates in the 21st century. The new 990 aims to give both the IRS and the public an improved window into the way tax-exempt organizations go about their vital mission."

The redesign of Form 990 released consists of a core form to be completed by each Form 990 filer and a series of schedules designed to require reporting of information only from those organizations that conduct particular activities.

"Most organizations should not experience a change in burden," said Lois G. Lerner, director of the IRS’s Exempt Organizations division. "However, those with complicated compensation arrangements, related entity structures and activities that raise compliance concerns may have to spend more time providing meaningful information to the public."

In 2006, an estimated 400,000 nonprofits filed Form 990, "Return of Organization Exempt From Income Tax," according to the Wall Street Journal.

In releasing this redesigned form, the IRS said it is soliciting comments, especially in connection with the goals of increased transparency of information and use as a compliance tool. The comment period lasts until Sept. 14, 2007.

The form, instructions and background material explaining the principles underlying the redesign of the form are available on the exempt organizations portion of the IRS Web site, http://www.irs.gov/eo. Questions and comments should be emailed to the IRS at Form990Revision@irs.gov.