The IRS is weighing a new question for the Form 990: whether any of your organization's top officials have been convicted of a serious financial crime or a terrorism-related offense in the past 10 years, or hit with certain securities-related civil judgments. CBS News reported the proposal on Aug. 18, citing sources with direct knowledge of the matter. It has not been formally proposed, no form language has been published, and nothing about the return you file this year changes. What the report does tell you is where the next public comment fight over nonprofit disclosure is likely to happen.
What the Question Would Ask
According to the CBS report, the proposal under consideration at Treasury and the IRS would require a nonprofit to disclose on its Form 990, the annual information return most tax-exempt organizations file, whether top officials, meaning officers, directors, or trustees, were convicted within the past 10 years of fraud, money laundering, securities fraud, tax evasion, theft, or providing material support to terrorists. Per the same report, the question would also cover civil judgments from SEC or state securities regulators' enforcement actions, which are not convictions at all. The organization would disclose that a conviction or covered judgment exists. It would not have to name the person.
Even without a name, the answer would not stay quiet. The 990 is a public document, so a checked box would be visible to every funder, journalist, and donor who looks your organization up. If you are not sure which version of the 990 your organization files, start there; the reporting describes a change to the form itself, and details like which filers it would reach do not exist yet.
CBS describes the conviction question as one of at least two Form 990 revisions moving through Treasury and the IRS. That squares with what the department has already said in public.
It Is Part of a Larger 990 Rewrite
In April, Treasury announced a Form 990 overhaul aimed at what it calls hidden funding: clearer reporting of government grants, government contracts, and fiscal sponsorship arrangements of 501(c)(3) organizations. "Tax-exempt status is not immunity from scrutiny," said Ken Kies, who was then the Treasury assistant secretary serving as acting IRS chief counsel, in that announcement. We covered what the fiscal sponsorship piece could mean for sponsors and projects when it landed.
The mechanism matters as much as the content. Treasury has said it expects the changes to go through proposed regulations with a public comment period before anything is finalized, and it has announced no timeline. Nothing here requires action on a return you are preparing now.
Supporters Call It Accountability. Critics Call It Guilt by Association.
The argument for the question is simple. "If your board members are convicted criminals, I am hard pressed to understand why you have a problem with that being publicized," Tom Jones of the American Accountability Foundation, a conservative watchdog group, told CBS.
The argument against is that a checked box with no name attached taints everyone. The disclosure "goes directly to guilt by association" and "could just create a stigma and chill association," Roger Colinvaux, a Catholic University law professor who studies exempt organizations, told CBS. Tax scholar Ellen Aprill of UCLA's law school saw "the potential for a fishing expedition." Diane Yentel, president and CEO of the National Council of Nonprofits, said complying with the disclosure "would take precious time and resources away from nonprofits' core work of serving communities." Her organization flagged the proposal in its Aug. 24 policy newsletter.
Wherever you land, the volume of reaction is a preview. This summer's OMB grant rule fight drew hundreds of thousands of comments to a single docket. A conviction question on the most widely filed nonprofit disclosure document would draw its own flood.
What to Do Now: Nothing on the Form, a Little in the Boardroom
There is no comment period to respond to yet, because there is no published proposal. When proposed regulations appear in the Federal Register, they will come with a comment window, and that is the moment to weigh in, individually or through your state association.
The boardroom work is worth doing regardless of what the IRS decides. Know who serves on your board and who your officers are, on paper and in practice. Basic vetting of incoming board members and officers, the same way you would vet a bookkeeper, is ordinary diligence, not paranoia. And keep conflict-of-interest disclosures current; if your board has not looked at its legal duties or its conflict-of-interest policy since founding, this is a decent prompt. A conviction in your leadership team is something you want to learn from your own onboarding process, not from a federal disclosure form.
The Takeaway
A Form 990 question about leaders' criminal convictions is under consideration, not law. The return you file this year is unchanged, and any change must survive proposed regulations and public comment first. Treat this as an early warning: the 990 rewrite Treasury announced in April is moving, it now reportedly includes a conviction disclosure, and the comment period, when it opens, will be the one chance to shape the details. Until then, the only work worth doing is the governance hygiene you should be doing anyway.