Uniform Guidance Compliance: Watch Out for 3 Danger Zones

Federal funding in response to the COVID-19 pandemic has meant that more nonprofits have found themselves subject to the Uniform Guidance for Federal Awards — the rules and requirements for obtaining federal grants. If they spent $750,000 or more in federal awards in a fiscal year, they’re also facing single audits, possibly for the first…

IRS Issues Guidance on LLCs as 501(c)(3) Entities

Nonprofits often use limited liability companies (LLCs) when they want to form subsidiaries to, for example, launch a new service or joint venture. However, federal regulations for tax-exempt organizations don’t specifically address LLCs. This makes new guidance from the IRS on the requirements an LLC must satisfy to be deemed tax-exempt welcome news. Guidance gap…

Updating Collective Impact Initiatives to Include Equity

Large-scale social change involving issues such as global warming, racial justice, economic development or education generally isn’t possible for individual nonprofits. An approach known as “collective impact” coordinates organizations across multiple sectors to tackle these larger issues. Here’s what you need to know before signing on to such an initiative. What is it? Collective impact…

How Federal Legislation May Affect DAF Distribution Timelines

A bipartisan group of legislators has introduced the Accelerating Charitable Efforts (ACE) Act in the U.S. House of Representatives. The ACE Act mirrors a bill introduced in the Senate in June 2021. It would create two new types of donor-advised funds (DAFs) — 15-year (or qualified) and 50-year (non-qualified) — with the timing and availability…

IRS and Fraud Concerns for Faith-based Nonprofits

Religious congregations must comply with IRS rules and federal and state laws. But because they don’t have to file income tax returns, some fail to engage independent financial experts. Without that oversight, congregation leaders may not know all the requirements to which they’re subject and internal controls could be lacking. This leaves them vulnerable to…

Ready for the New Gifts-in-Kind Reporting Requirements?

The Financial Accounting Standards Board (FASB) has new rules for how nonprofits that follow Generally Accepted Accounting Principles (GAAP) must report and value “non-financial assistance” — commonly known as gifts in kind. The changes are effective for annual periods beginning after June 15, 2021, and interim periods within annual periods beginning after June 15, 2022….

Giving Circles Surge in Popularity: What it Means for Nonprofits

According to the Dorothy A. Johnson Center for Philanthropy, giving circles have tripled in number since 2007, to about 1,600 groups with more than 46,000 members in the United States. With almost $1.3 billion in grants already made by giving circles, your nonprofit should ensure it’s on the circles’ radar. Small groups, big impact Giving…

Do your employees qualify for loan forgiveness?

The U.S. Department of Education (DOE) is revamping the Public Service Loan Forgiveness (PSLF) Program, which cancels loans after 10 years of public service by eligible borrowers. Among other things, the DOE is providing a temporary opportunity (through October 31, 2022) for borrowers to get credit for payments they’ve made that wouldn’t otherwise count toward…

Changes are Coming to Your Auditor’s Report

The American Institute of Certified Public Accountants (AICPA) Auditing Standards Board’s latest standards are kicking in, and many nonprofits will notice resulting changes to the format and content of auditor reports on their organizations’ financial statements. The updates are intended to make auditor reports more meaningful and transparent for the users of financial statements, including…

How to Protect Your Nonprofit from Cyberattacks

The COVID-19 pandemic has resulted in numerous risks for nonprofit organizations. In addition to health-related risks and financial challenges, the pandemic has intensified the threat of cyberattacks. Hackers have grown more sophisticated in recent years. They often target nonprofits because charities hold confidential donor data but may fail to safeguard such data. And the cost…