Who Are Disqualified Persons? Understanding Self-dealing Rules

The IRS strictly prohibits self-dealing between private foundations and so-called “disqualified persons.” Potential penalties for the disqualified person and foundation staff are stiff. Here’s what you need to know to avoid liability. Stiff penalties The Internal Revenue Code imposes a minimum 10% excise tax on disqualified persons on the amount involved in a self-dealing transaction….

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Critical Tax Reminders for Nonprofit Special Events

After the pandemic-induced lull, many nonprofits are making up for lost time and fundraising opportunities by ramping up their special events. It’s easy to get caught up in the details that come with event planning, but it’s also important to remember that these functions can have tax implications. Here are some things to keep in…

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Cybersecurity 101: Train Your Staff to Combat Hackers

When it comes to cyberthreats, your employees are on the front line, but many of them are unprepared. They may not be aware of the risks and red flags, and they may not know how to respond when cybercriminals strike. With the average total cost of a data breach at $4.35 million, and nonprofits far…

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Is a CFO the right choice for your nonprofit?

As nonprofits grow, some may struggle with the financial side. Let’s face it, nonprofits generally begin with a vision or passion, and not with financial know-how. For some organizations, a chief financial officer (CFO) may be a good choice. What does a CFO do? Generally, the nonprofit CFO (also known as the director of finance)…

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Inflation and Rising Interest Rates: What to Expect

The inflation rate hit highs in 2022 not seen since the early 1980s, and the federal funds interest rate has continued to climb steadily, after historically low rates during the height of the pandemic. Few nonprofit leaders have dealt with such economic conditions before. Read on to gain some insights on the landscape ahead and…

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Seniors Can Reduce Their Tax Burden by Donating to Charity Through Their IRA

Shared from IRS.gov  In most cases, distributions from a traditional Individual Retirement Account (IRA) are taxable in the year the account owner receives them but there are some exceptions. A qualified charitable distribution (QCD) is one of the few exceptions. A QCD is a nontaxable distribution made directly by the trustee of an IRA to organizations…

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Fundraisers Seek Protection with “Bill of Rights”

The Association of Fundraising Professionals (AFP), which previously developed a “Donor Bill of Rights,” is now looking inward to protect their members’ own “physical, mental and emotional wellbeing” on the job. A recent AFP survey found that nearly a quarter of fundraisers have experienced sexual coercion, meaning pressure from an employer to make themselves vulnerable…

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Do You Understand the Public Support Test?

Nonprofits that aren’t careful can stray over the line that distinguishes between public charities and private foundations. This can expose nonprofits to lower tax-deductible donation limits as well as potential excise taxes and penalties. Certain organizations, including universities and churches, automatically qualify as public charities, but others must pass a public support test. Role of…

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Lease Accounting Rules Are (Finally) Here

Implementing the FASB’s Accounting Standards Update The updated accounting standard for leases, released back in 2016, is finally taking effect this year for all organizations, including nonprofits, that haven’t already adopted it. You might be surprised at how many “leases” you have under the Financial Accounting Standards Board’s (FASB) Accounting Standards Update (ASU) 2016-02, Leases…

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Ways to Improve Your Organization’s Accounting Function

Although nonprofits may be exempt from income tax, they still have financial and accounting requirements. This includes projecting budgets and monitoring the results, preparing financial statements and collecting payroll taxes. Accounting processes can become inefficient over time if you don’t monitor them. Here are some suggestions of procedures your organization should review regularly. Invoicing and…

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