Timing of CHNA to be reported on Schedule H

Question: My question is about the timing of a CHNA to be reported on the Schedule H. A colleague of mine had the understanding that since the Schedule H instructions state that the CHNA must be conducted in the year that the Schedule H is submitted, that the primary data collection must then occur during that same fiscal year. This means that if their CHNA is due in 2019 and their data collection is taking place this summer, they are planning to have the data collection extend until October 2018, so that it will have occurred within their Sept – August fiscal year. They could normally collect data in the spring and summer, so it seems odd to stretch data collection until October solely for this reason.

To me, this seems like a strange interpretation of that requirement. I think the answer to this question hinges on how strictly you define "conducting a CHNA" within the fiscal year that it's due, since the CHNA process spans many months and data collection is one of the first steps.

Recommendation: An organization should report on Schedule H its most recently completed CHNA as of the last day of the tax year covered by its Form 990; that is, its most recently completed CHNA that its governing body has approved and that has been posted on its website, as of the last day of the tax year covered by that Form 990. So in your example, if the organization's three-year CHNA cycle ends on Aug. 31, 2019 (and thus the CHNA report must be completed, board-approved, and posted online by that date), it would be advisable for the organization to finish the CHNA process sometime during the 9/1/18-8/31/19 period; if it were to finish before 9/1/18, it would accelerate the end date of the next 3 year CHNA cycle by one year. Keep in mind, it wouldn't need to extend data collection until October 2018. Rather, it could wait to secure board approval and/or post the CHNA report online until the 9/1/18-8/31/19 period for the CHNA to be "completed” during that year.


Recommendation provided by Stephen Clarke, executive director of Exempt Organization Tax Services at Ernst and Young LLP. Prior to joining Ernest and Young, Mr. Clarke was a tax law specialist, project manager and guidance group manager with the Internal Revenue Service (IRS) Exempt Organizations division where he served as the project manager for the 2008 redesign of Form 990 and also served on the team that developed Form 990, Schedule H.


(March 2018)

Please Take Note: The information provided does not constitute legal or tax advice. The material is provided for informational/educational purposes only. Please consult with counsel regarding your organization's particular circumstances.