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Category: Not-for-Profits

April 8, 2022

Preparing Form 990: Pay Attention to These Eight Items

  If your not-for-profit organization operates on a calendar-year tax basis, the deadline for filing your 2021 Form 990 (Form 990 EZ for certain small organizations) is right around the corner — May 15, 2022. Besides filing on time, you must ensure the information provided on your form is accurate. Pay particular attention to the following eight issues that commonly trip up nonprofits: 1. Unrelated business income tax (UBIT). If your not-for-profit regularly engages in activities that generate profits, for… Read more ›

April 7, 2022

Paving the Wave for Your Not-for-Profit’s Next Leader

  Suppose the founder or long-time executive director of your not-for-profit organization is scaling back on her workload and making plans to retire. What will her departure mean for your organization? If your nonprofit has a well-crafted succession plan, it’s likely to survive any leadership transition. But if you don’t have a plan, your organization could endure a rocky period, and possibly close. Even if your top leader intends to remain in the job for years, illness or another unanticipated… Read more ›

April 7, 2022

Charting a Change in Culture

  Every not-for-profit develops a culture over time, often defining the organization. However, even if your group’s been successful in the past, a change in culture could be a change for the better. Warning Signs to Observe First, does your culture need an alteration? It’s often difficult to know for sure, but there are several warning signs that change might be warranted. For instance: Lack of commitment. It’s important for the people working for your organization to believe in its… Read more ›

April 7, 2022

How the Current Tax Law Affects Charitable Giving from IRAs

  For charitable donors, the Tax Cuts and Jobs Act (TCJA) provided some tax breaks and took away others. Here’s what charity-minded individuals need to know. Increased Charitable Deduction Limit Under prior law, deductions for cash contributions to public charities and certain private foundations were limited to 50% of your adjusted gross income (AGI). The TCJA, which passed in December of 2017, increased the deductible limit to 60% of AGI for the 2018-2025 tax years. Deductions that are disallowed by… Read more ›

February 28, 2022

Protect Directors and Officers From Legal Liability

It’s an age of personal responsibility. Even if your not-for-profit‘s board members do everything in their power to make good governing decisions, legal liability can potentially lead to their financial ruin. Here’s how to protect your board. It’s personal Being an effective board member takes time, effort and diligence. Unfortunately, even dedicated board members may be at financial risk if a disgruntled party sues and holds them individually liable for their actions. Suppose you run a mentoring program and a… Read more ›

February 28, 2022

Documents You Must Keep for Tax Purposes

It’s critical for your organization to keep accurate tax related documents and maintain a good recordkeeping system. This way, you can respond to an IRS audit or prove compliance with various laws should it become necessary. However, you don’t have to retain every paper document or electronic file that crosses your desk. The IRS requires organizations to keep certain essential documents on file. These records back up accounting entries, reported taxable income, expenses and deductions. For example, you must keep… Read more ›

January 28, 2022

Yes, You Do Need Investment Policies

So you think investment policies are only for not-for-profits with millions to invest? Not true. If your organization holds funds in reserve — for example, to cover emergencies or meet long-term goals — it’s prudent to have investment policies. Such policies will help ensure that you manage reserve funds responsibly according to their purpose and take steps to minimize investment risk. Pooling Funds Creating investment policies begins by defining the purpose of different funds or investment pools. Some not-for-profits maintain… Read more ›

January 28, 2022

Choosing a Retirement Plan for Your Not-for-Profit

Traditionally, 403(b) plans have been the qualified retirement plan of choice for not-for-profits. These plans were established for the exclusive benefit of tax-exempt organizations. However, a not-for-profit now have other options as well. Even if you continue to prefer a 403(b) plan, as many nonprofits still do, it pays to review and weigh the benefits of other types of accounts. Four Types A not-for-profit generally may choose from the following four plans: 1. 403(b). The 403(b) plan is comparable to… Read more ›

December 21, 2021

Four Big Charitable Tax Breaks for 2021

Are you feeling generous? Qualified charitable contributions can be rewarded with sizeable tax breaks during the second calendar year of the COVID-19 pandemic. Recent legislation includes the following four temporary tax law changes that are designed to help individuals and businesses that donate to charities through the end of 2021. 1. Deductions for Non-Itemizers In the past, you could claim significant itemized deductions on your federal income tax return for contributing money or property (or both) to qualified charitable organizations… Read more ›

December 21, 2021

Audits are Essential to Your Organization’s Health

Audits have become more important due to increased public and government scrutiny of not-for-profit organizations, their management and their boards. Audits not only provide you with a fair assessment of your organization’s financial health, but also can reveal vulnerabilities such as weak internal controls, insufficient cash reserves and poor investment policies. Perhaps most important, regular audits reassure your donors, members and other stakeholders that you run a fit organization. Ins and Outs Audits come in two forms, serving different purposes:… Read more ›