A public charity has to demonstrate, year after year, that it genuinely is publicly supported rather than funded by a small number of sources.
The test looks back over several years, which means the answer is built from how support was recorded as it arrived rather than from anything done at the return. An organisation that logged only totals cannot reconstruct it from a bank statement.
This covers who has to file the schedule, the basis on which status is claimed, how the support test is calculated, how concentration among large donors is treated, and what happens if the test is failed.
What Is Form 990 Schedule A?
Schedule A is a required attachment to Form 990 or Form 990-EZ for most public charities. Its purpose is to document that your organization qualifies as a public charity rather than a private foundation, and to show that it passes the public support test over a rolling 5-year period.
The classification is decided by how support is coded as it arrives, not by anything done at the return. An organisation that records who each amount came from and what kind of party they are finds this schedule straightforward. One that records only totals cannot rebuild it from a bank statement.
Ankit Sarawagi, CPA, CA, MBA · LinkedInWho Must File Schedule A?
- Organizations filing Form 990 or Form 990-EZ that are classified as public charities under Section 501(c)(3).
- Most 501(c)(3) organizations, except private foundations (which file Form 990-PF instead of Schedule A).
Part I: Reason for Public Charity Status
In Part I, you check the box that explains WHY your organization qualifies as a public charity. The main categories are:
- Church or association of churches.
- School.
- Hospital or medical research organization.
- Organization that supports a governmental unit.
- Publicly supported organization (passes the 33.3% public support test), most charities check this.
- Supporting organization (organized to support another public charity).
- Private operating foundation (a type of private foundation with special rules).
Part II: 33.3% Public Support Test (Most Common)
For organizations that rely on the general public for support, Part II calculates the public support percentage over the most recent 5 tax years:
- Calculate total support received (grants, contributions, government grants, program service revenue, etc.).
- Calculate public support (contributions from individuals, corporations, and government entities, subject to concentration limits).
- Divide public support by total support.
- If the result is 33.3% or more, you pass the public support test.
Donor Concentration Limits
Contributions from any single donor (other than government entities) that exceed 2% of total support in the 5-year period are excluded from the public support calculation. This prevents a single large donor from propping up a charity's public support percentage.
Facts and Circumstances Test: 10% Alternative
If your public support percentage is between 10% and 33.3%, you may still qualify as a publicly supported charity under the facts and circumstances test. This requires showing that you normally attract broad public support and have other characteristics of a public charity. Attach an explanation.
Part III: 33.3% Test for Organizations Described in Section 509(a)(2)
Organizations that derive support mainly from program service revenue (fees for services) use Part III instead of Part II. The test still requires that public support (contributions + program service revenue) makes up at least 33.3% of total support, and that investment income and unrelated business income do not exceed 33.3%.
Supporting Organizations: Part IV
If your organization is a supporting organization (supporting another public charity), you complete Part IV to describe the type of supporting organization (Type I, II, or III) and the relationship with the supported organization.
How to Complete Schedule A Efficiently
- Identify which type of public charity your organization is (Part I box check).
- Gather contribution and revenue data for the current year AND the prior 4 years.
- Calculate total support and public support according to the applicable test.
- Identify and apply any donor concentration adjustments.
- Calculate the public support percentage.
- Attach explanations if using the facts and circumstances test.
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Frequently Asked Questions
What happens if we fail the public support test?
Failing the test means the IRS may reclassify your organization as a private foundation, which is subject to excise taxes, more restrictions on activities, and stricter distribution requirements. Consult legal counsel immediately.
Do we include government grants in public support?
Yes. Grants from governmental units are fully included in public support without the 2% concentration limit that applies to other donors.
Is Schedule A required every year?
Yes, as long as your organization is classified as a public charity and files Form 990 or 990-EZ.
What is the 5-year lookback period?
The 5-year period includes the current tax year plus the 4 immediately preceding tax years.
What should an organisation be tracking through the year for this?
Support by source, in enough detail to classify it later. That means recording who each amount came from and what kind of party they are, not simply the total received. The classification decides the outcome and it cannot be reconstructed from a bank statement, so the work belongs in the bookkeeping rather than in the return. Organisations that code receipts correctly as they arrive find this schedule straightforward.
Written by
Ankit Sarawagi, CPA, CA, MBA
Ankit leads the finance team at Profitjets, where he has worked with 500+ businesses across the US on bookkeeping, tax and CFO-level strategy. He writes about the habits that keep small business books accurate all year. Connect on LinkedIn
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