IRS Schedule G (Form 990): Fundraising, Gaming, and UBIT

IRS Schedule G attaches to Form 990 or Form 990-EZ and reports a tax-exempt organization’s professional fundraising services, fundraising events, and gaming activities. You file it whenever any of those three categories crosses $15,000 during the tax year.¹ Once filed, Schedule G becomes part of the publicly available return, so donors, watchdogs, and journalists can see how much your organization spends raising money compared with what reaches the mission.²

What Triggers a Schedule G Filing

Three questions on Form 990, Part IV — lines 17, 18, and 19 — decide whether you attach Schedule G. Answering “yes” to any one of them pulls in the corresponding part of the schedule:³

Line 17 (Part I): more than $15,000 in professional fundraising expenses reported on Form 990, Part IX.
Line 18 (Part II): more than $15,000 in combined gross income and contributions from fundraising events on Part VIII.
Line 19 (Part III): more than $15,000 in gross income from gaming on Part VIII.

The thresholds are independent. A charity that pulls $30,000 from a gala but hires no outside fundraisers and runs no games completes only Part II. Form 990-EZ filers hit the same $15,000 triggers through parallel lines on their form.¹

Part I: Professional Fundraising Services

A professional fundraiser, for Schedule G purposes, is an outside individual or firm that exercises judgment or discretion in planning, managing, or directly soliciting contributions. Direct mail consultants, grant writers, and telemarketers fit the definition. Your own employees performing fundraising in their normal role do not, and neither do purely mechanical vendors like printers, mailhouses, or bank caging services.⁴

One exception matters. Fees paid to officers, directors, trustees, key employees, and disqualified persons for fundraising services get reported on Part I whether or not those people are on payroll.⁴

Part I asks you to list the ten highest-paid outside fundraisers who were each compensated at least $5,000 during the year.³ For each one you report the name and business address, the type of activity, whether the fundraiser had custody or control of the money it raised, gross receipts from the activity, and the fees the fundraiser kept.

The custody-of-funds question is not a throwaway. If a fundraiser physically holds donations before remitting them, or can direct how the money is deposited, you have to describe the arrangement in Part IV of the schedule.⁵ Written contracts are your best backup for those details, so keep them on file.

Part II: Fundraising Events

Galas, auctions, benefit concerts, golf tournaments — Part II is where the financials of those events go. You report your two largest events separately (each measured by gross receipts over $5,000) and combine every remaining event with gross receipts over $5,000 into a single aggregate column.⁵

Gross Receipts Versus Contributions

Part II splits revenue between total gross receipts and the piece that qualifies as a charitable contribution. The contribution portion is only the amount a payer gave above the fair market value of what they received. If a $250 dinner ticket buys a meal worth $75, the contribution is $175. Track both numbers for every event; the IRS uses the split to gauge how much event revenue is charitable giving versus a commercial exchange.

Direct Event Expenses

Direct expenses go into six required categories:⁵ cash prizes, noncash prizes (at fair market value), rent and facility costs, food and beverages, entertainment, and other direct expenses. That last bucket sweeps in event-worker pay and independent contractor fees, and you have to keep an itemized list in your records.

Noncash prizes should be valued using a reasonable, good-faith method — recent sale prices of comparable items, replacement cost, and the condition of the property.⁶ Inflated donor-supplied retail prices will not hold up.

Part III: Gaming Activities

Bingo, pull tabs, Texas Hold ‘Em tournaments, casino-night fundraisers, and raffles all belong in Part III when gross gaming income tops $15,000. The financial layout mirrors Part II (gross revenue, cash and noncash prizes, rent, other direct expenses), but gaming adds licensing and operational disclosures.¹

You have to state whether the games were run by your own people or by an outside operator, and whether the organization held the state or local licenses gaming law requires in your jurisdiction.

Volunteer Labor

Part III separates volunteer hours from paid labor. The distinction is not cosmetic. If substantially all the labor running the gaming activity is performed by unpaid volunteers, the activity may be excluded from unrelated business income tax even when it would otherwise be taxable.⁷

Gaming Manager Disclosure

You must name the person with overall supervisory responsibility for the gaming operation, the one handling recordkeeping, money counting, hiring and firing workers, and bank deposits. Report their compensation (or the portion tied to gaming if they also do other work) and whether they are a director, officer, employee, or independent contractor.⁵ Additional co-managers go in Part IV.

Gaming Income and Unrelated Business Income Tax

This is where many organizations get caught. The IRS treats most gaming as a trade or business. If you run games regularly for profit, that income is generally unrelated business income even when every dollar goes to your charitable programs. Using proceeds for good works does not make the gaming itself related to your exempt purpose.⁷

A few exclusions can protect gaming income:

Bingo, if the game fits the IRS definition (all wagers placed, winners determined, and prizes distributed in the presence of everyone playing that game), does not violate state or local law, and is played in a jurisdiction where for-profit operators do not regularly run bingo.⁸
Volunteer labor, where substantially all the work is done by unpaid volunteers.⁷
Qualified public entertainment activities, which can cover gaming at fairs and similar public events.

Social clubs and fraternal organizations sit outside the standard exclusion framework — a 501(c)(7) social club’s gaming income from nonmembers is unrelated business income regardless of volunteer involvement.⁷ Taxable gaming income goes on Form 990-T in addition to the Schedule G disclosures.

Reporting Prizes to Winners

Gaming events create a separate obligation to individual winners. For 2026, your organization must file Form W-2G for any person whose gambling winnings from a single game of bingo, keno, or slot machines are $2,000 or more. The threshold adjusts annually for inflation.⁹

Raffles, sweepstakes, and wagering pools apply a two-part test: the winnings must meet or exceed $2,000 and be at least 300 times the wager. When you sell five raffle tickets for $1, each ticket counts as a $0.20 wager for the ratio.⁹ Missing W-2Gs can bring separate information-return penalties, so set up prize tracking before the event, not after.

Filing Deadlines and Extensions

Schedule G rides with Form 990 or 990-EZ, so it is due on the 15th day of the 5th month after your fiscal year ends. Calendar-year organizations file by May 15. Form 8868 provides an automatic six-month extension when submitted by the original due date, pushing calendar-year returns to November 15.¹⁰ No explanation is required for the extension.

Most organizations file electronically. If Schedule G is missing when the rest of the return goes in, the IRS treats the filing as incomplete, and the penalty clock can start.

Penalties and Loss of Exemption

The penalty for filing Form 990 late or without required information, including a missing or incomplete Schedule G, begins at $20 per day for as long as the failure continues. For any single return, the ceiling is the lesser of $10,000 or 5 percent of the organization’s gross receipts for the year.¹¹ Larger organizations face higher daily rates and caps.

If the IRS sends the return back for corrections and sets a deadline, an officer or manager personally responsible for the failure can be charged $10 per day up to $5,000.¹² That penalty falls on the person, not the organization.

Three consecutive years of missed annual returns triggers automatic revocation of tax-exempt status, effective on the due date of the third missed return.¹³ Getting exemption back requires a new application.

Reasonable Cause and Abatement

The IRS will consider abating penalties on reasonable-cause grounds. You attach a written statement, signed under penalties of perjury, that explains what prevented timely or complete filing, the steps taken to comply, and what has been done to prevent a repeat.¹⁴ Determinations are case by case, and vague explanations rarely succeed. The agency looks for evidence of ordinary business care.

Correcting a Filed Schedule G

If you discover an error after filing, you amend by submitting a complete new Form 990, not just the corrected schedule. Check the “Amended return” box on the header and use Schedule O to describe exactly what changed and why.⁴ Use the version of Form 990 for the year you are amending, not the current-year form.

Amended returns are also public. The corrected return must be available for inspection for three years from its filing date or three years from the original return’s due date, whichever is later.⁴

Records to Keep

Exempt organizations must keep books and records sufficient to show compliance. For Schedule G, that includes fundraiser contracts, event budgets, prize winner logs, gaming license copies, and itemized expense records. General IRS guidance calls for at least three years from the filing date, extending to seven years in situations like unreported income above 25 percent of gross receipts or claims involving bad debts.¹⁵ Given public scrutiny and the possibility of amendments, the longer end of that range is the safer practice.

1
Internal Revenue Service. Form 990 – Return of Organization Exempt From Income Tax
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Office of the Law Revision Counsel. 26 USC 6104 – Publicity of Information Required From Certain Exempt Organizations and Certain Trusts
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Internal Revenue Service. Instructions for Schedule G (Form 990)
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Internal Revenue Service. Instructions for Form 990 Return of Organization Exempt From Income Tax
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Internal Revenue Service. Instructions for Schedule G (Form 990)
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Internal Revenue Service. Audit Technique Guide – Fundraising Activities
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Internal Revenue Service. Exempt Organization Gaming and Unrelated Business Taxable Income
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Internal Revenue Service. Definition of Bingo
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Internal Revenue Service. Instructions for Forms W-2G and 5754
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Internal Revenue Service. Extension of Time to File Exempt Organization Returns
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Office of the Law Revision Counsel. 26 USC 6652 – Failure to File Certain Information Returns, Registration Statements, Etc
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Internal Revenue Service. Annual Exempt Organization Return – Penalties for Failure to File
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Internal Revenue Service. Automatic Revocation of Exemption
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Internal Revenue Service. Exempt Organizations Annual Reporting Requirements – Filing Procedures: Abatement of Late Filing Penalties
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Internal Revenue Service. How Long Should I Keep Records