The IRS definition
The IRS defines gross receipts as the total amounts the organization received from all sources during its annual accounting period, without subtracting any costs or expenses. It is the number that decides whether you can file the 990-N, and it feeds the 990-EZ and 990 limits too.
Volunteers usually think about what the club “made.” The IRS asks what came in the door. Those two numbers can be very far apart.
What goes into gross receipts
- Member dues and family assessments
- Donations, including matching gifts and money collected at events
- Business sponsorships and program ads
- Concession stand and bake sale sales, at full price
- Apparel, spirit wear and fundraiser product sales, at full price
- Raffle ticket sales and other gaming income
- Ticket sales for dinners, galas and golf outings
- Interest on the club's bank account
- Grants from a town, school fund or foundation
Money that only passes through the club (for example, a team trip that parents pay for and the club forwards to a bus company) is a common gray area. Record it gross in your books and ask your preparer how it should be reported, rather than leaving it off.
An illustrative snack-bar year
Illustrative only. A football boosters club has $18,000 in dues and donations. It runs the home-game concession stand, which sells $30,000 of food and drink and spends $28,000 on supplies. It sells $9,000 of spirit wear that cost $8,000.
The club's net fundraising result is modest. Its gross receipts are $57,000: $18,000 plus $30,000 plus $9,000. If that level holds for three years, the club is past the 990-N limit and files the 990-EZ.
| What the board sees (net) | What the IRS counts (gross) | |
|---|---|---|
| Dues and donations | $18,000 | $18,000 |
| Concession stand | $2,000 | $30,000 |
| Spirit wear | $1,000 | $9,000 |
| Total | $21,000 | $57,000 |
Checking the three-year average
Once a club is at least three years old, the 990-N test is an average: this year plus the two before it. That smooths out one big year, but it also means a club that has grown steadily can cross the line without any single dramatic change.
Illustrative only. A PTO's gross receipts over four years were $38,000, $46,000, $55,000 and $61,000. Averaging the three years ending in year three gives $46,333, so year three is a 990-N year. Averaging years two to four gives $54,000, so year four is a 990-EZ year, even though nothing about the PTO's events changed that year except their size.
| Year | Gross receipts | 3-year average (including this year) | Return |
|---|---|---|---|
| Year 1 | $38,000 | First-year test ($75,000) | 990-N |
| Year 2 | $46,000 | Two-year test ($60,000 average) | 990-N |
| Year 3 | $55,000 | $46,333 | 990-N |
| Year 4 | $61,000 | $54,000 | 990-EZ |
Why the Massachusetts number is different
The Attorney General's Form PC uses “gross support and revenue,” which is the base for the filing fee and the review and audit thresholds. Under Massachusetts General Laws c.12 §8F it excludes gains or losses from selling a capital asset. It is close to gross receipts for most clubs, but not always identical, so keep enough detail to compute both.
It matters because two Massachusetts lines sit at round numbers: at $25,000 or less, charities no longer attach a federal Form 990 to Form PC (since 31 May 2023), and above $500,000 the AG requires reviewed or audited statements from an independent CPA.
How to keep the number honest in your books
- 1.Record every sale at the full amount received, and record the supplies you bought as a separate expense.
- 2.Deposit event cash whole. Do not pay a vendor or reimburse a parent out of the cash box.
- 3.Give each event its own income and expense lines, so gross and net are both visible.
- 4.Record Venmo, Square and PayPal sales at the gross amount and the processor's fees as an expense.
- 5.At year-end, add up income before expenses and compare it with the three-year 990-N test and the AG's $25,000 line.
Where we come in
If your books show only net figures, or cash was spent before it was deposited, we can rebuild the year from bank statements, event records and receipts so gross receipts are right before the return is prepared. We give you a scope and a price in writing before anything starts.
Figures on this page were checked against the IRS and Massachusetts sources listed alongside on 28 Sep 2026. They change — confirm the current amount before relying on one.
General information for owner-led businesses, not advice for your specific situation. Tax and accounting rules change, and how they apply depends on facts particular to your business. Talk to us — or to another qualified professional — before acting on anything here.
