Tips for Entering Insurance Premiums on Form 990

Form 990 season is here, and it’s likely that someone at your land trust may be wondering where to enter the Terrafirma payment and other insurance premium. We’re here to help! Here are a few tips:

• Please consult your land trust accountant or tax professional.   We can’t give you tax or other advice.
• A general reading of the instructions shows that insurance premiums are entered on the main form Part IX, line 23.
• And lastly, for Schedule D, a general observation of those instructions suggests that the IRS is looking only for specific enforcement actions after you discover a violation by a property owner.  Following that definition would mean not listing any insurance premium payments on Schedule D except possibly in a year of an actual claim meeting the IRS enforcement definition. 
• Here is the IRS definition of enforcement for purposes of Schedule D:  “Enforcement of an easement means action taken by the organization after it discovers a violation to compel a property owner to adhere to the terms of the conservation easement.”

Remember: consult your land trust’s financial, tax or legal advisor on this new issue.

Let us know how we can help you.