A couple of weeks ago I wrote a piece on the impact of the government shutdown on the flow of nonprofit data. In that piece I suggested it would be unlikely that the IRS would release a new Exempt Organization Business Master File (BMF) on schedule in February.
Well it appears I was premature in making that assessment. The BMF, Publication 78, and Automatic Revocation of Exemption Lists all were released last week.
Although these files have been released, we should not assume the IRS was able to clear its backlog. In fact, the February BMF data doesn’t match prior-year patterns, which give us a sense of the backlog the IRS has to yet to work through.
Over the past several years, February has been the month where we’ve seen the highest number of new nonprofits show up on the BMF. But, as you can see from the chart below, the February 2019 file contains the smallest number of new nonprofits that we’ve seen since 2015.
February has also been the month where we’ve seen the largest bump in organizations that had fallen off the BMF being added back on. Although the February 2019 figure is not as off as the new organizations statistics, we can see this number falls below prior years.
Changes to BMF Records
Last but not least, when we look at the nonprofits records that persisted in the BMF from month to month, there is typically a bump in the number of records that were updated in some way in February, June, and December. These changes are most often driven by updates the IRS receives from annual filings. The low number of changes we see in this month’s data suggests that there is a lag in filing information making it into the BMF.
So the recommendation I made to nonprofit leaders at the end of last month still stands: don’t wait for the IRS to get your updates to the public. Instead, take a few minutes to update your organization’s Nonprofit Profile. This is a great way to ensure that everyone has the freshest information possible about your organization at any given time. And if we haven’t received your latest 990 from the IRS, you can upload a copy to your profile.
Holly Ivel is Candid’s director of data services.