What Is Form 990 and Why Should You Care
In the United States, private foundations and public charities that receive more than $50,000 in annual revenues are required to file Form 990 — a detailed annual information return with the Internal Revenue Service. Unlike most tax documents, Form 990 is publicly available and contains extraordinarily detailed information about a foundation's grant-making activity, financial health, governance, leadership compensation, and strategic direction. Every organization on your prospect list that is registered in the United States has filed at least one Form 990, and these documents are available for free through databases like ProPublica's Nonprofit Explorer, Candid/GuideStar, and the IRS Tax Exempt Organization Search. A non-profit development professional who knows how to read and analyze Form 990s has access to a level of strategic intelligence about potential funders that competitors who rely only on foundation websites and annual reports simply don't have.
Finding Strategic Intelligence in Schedule I
Schedule I of Form 990 is the most directly useful section for grant prospecting: it lists every grant the foundation made during the year, including the recipient organization's name, the grant amount, the purpose of the grant, and often the recipient's geographic location. Reading through Schedule I for three consecutive years of filings gives you a detailed picture of a foundation's actual grant-making patterns — not just their stated priorities, but where they actually sent money. This information answers the questions that foundation websites often leave ambiguous: What is the typical grant size? Do they make many small grants or a few large ones? Which geographies do they actually fund (as opposed to the broad geographic language on their website)? Are they increasing or decreasing their giving in your sector? Do they give to first-time grantees, or does their Schedule I show the same organizations receiving grants year after year?
Reading the Financial Picture
Beyond grant-making data, Form 990 reveals important information about a foundation's financial health and trajectory. The balance sheet section shows total assets, which tells you the foundation's endowment size. The investment income section shows their annual investment returns, which directly determines how much they have available to grant (foundations are required to distribute at least 5% of assets annually). Comparing several years of filings reveals whether the foundation's assets are growing, stable, or declining — information that predicts whether grant sizes and volumes are likely to increase or contract. In years following significant stock market declines, many foundations saw their assets drop substantially, directly reducing their grant-making capacity. A foundation whose assets have been declining for three consecutive years is a less attractive prospect than one whose assets have grown steadily.
Using 990 Data in Your Prospecting System
Build 990 analysis into your standard funder research process. For every new prospect where you are seriously considering investing proposal writing time, pull the last three years of Form 990s and complete a structured analysis: total assets and trend, annual grant volume and trend, typical grant size range, Schedule I grantee list and themes, geographic patterns, and leadership and staff names. Document this analysis in your prospect research notes alongside website-based research, program officer contact information, and any intelligence from sector network conversations. Over time, your organization will build a proprietary intelligence database about your prospect universe that gives you significant advantages in timing your outreach, tailoring your proposals, and accurately predicting your probability of success with each funder — advantages that compound significantly as your funding portfolio grows.
