Category: not for profit

The difference between financial pledges and donations is relatively simple: Pledges are promises to donate sometime in the future, and donations provide immediate support for your not-for-profit organization. What’s not so simple is accounting for pledges. After all, a promise to donate isn’t a guarantee that you’ll receive the money when the contributor says you…

You may know the difference between nonprofit and for-profit accounting systems, but do your newest employees and board members? Not-for-profits and businesses share certain similarities. For example, both must carefully track transactions and produce accurate, timely financial statements. But there are enough differences between the two that you may want to provide training for new…

If your nonprofit has investment income, dividends, interest, rents and annuities, they’re generally excluded when calculating unrelated business income tax (UBIT). However, income from debt-financed property typically is taxable. So it’s important to segregate income from such property and include it in UBIT calculations to help ensure you don’t trigger unwanted IRS attention. What counts…

According to nonprofit BoardSource, not-for-profit boards that meet monthly should be able to cover all business in one to two hours. If your meetings last longer, they may lack planning and focus. This can ultimately harm your organization as busy board members lose confidence in your leadership — and even quit. Here’s how to hold…

The SECURE 2.0 Act made some enhancements to IRA qualified charitable distributions (QCDs) that may benefit your not-for-profit organization — so long as donors know about them. You can encourage your supporters to contribute more by boning up on the new rules and communicating their tax advantages. QCDs to RMDs First, the basics: QCDs were established…

Are your not-for-profit’s board members independent? Your immediate response is probably, “of course!” But contrary to what many nonprofit leaders and staffers might think, director independence goes beyond avoiding conflicts of interest. In fact, the IRS has a four-part definition of independence. If a majority of your organization’s board members don’t meet all four criteria,…

Let’s say that one of your not-for-profit’s employees makes significant personal purchases on a credit card you’ve provided for work-related expenses. You may think the outcome is relatively straightforward: The individual is fired and referred to law enforcement for prosecution, and you recover the funds. Unfortunately, obtaining a criminal conviction may be difficult. Plus, you might…

If your not-for-profit is looking for significant ways to cut costs, one of the best ideas is to target your workspace. Sharing an office or other facility can help you slash rent or pay a mortgage, as well as cut utilities expenses. These arrangements can also provide other, less obvious cost-busting benefits, such as enabling…

There are many reasons why a 501(c) tax-exempt organization might consider restructuring. For example, a financially struggling nonprofit might decide to join forces with another organization to cut costs and share resources. Or a nonprofit might decide to change its state of organization. Such changes generally qualify for a simplified restructuring process. However, it’s important…

For many not-for-profit organizations, maintaining a full and active board of directors is challenging. If your board holds frequent meetings, has high attendance expectations and requires members to do considerable “homework,” you may have trouble recruiting and retaining people. Qualified individuals generally are busy with work, family and other activities and may not have spare…