By: Linda Curro and Diana Miller
On December 10th, the IRS issued Notice 2018-99 (“Notice”) addressing guidance with respect to the tax treatment of qualified transportation fringe (“QTF”) benefits; specifically how employers should determine the amount of any nondeductible parking expense for employer provided parking. The Notice has provided guidance as to the disallowed parking expenses associated with the 2017 Tax Cuts and Jobs Act which currently disallows certain employer...
Its intentions are good, but the 2017 Tax Cuts and Jobs Act (TCJA) can have a negative effect on non-profit organizations in at least a couple ways. We’ll take a look at how one of the new provisions of the TCJA complicates the provision of what might be a much-needed benefit for some of your employees.
The IRS explains the tax code change, known as section 512(a)(7), under the heading “Increase in unrelated business taxable income by disallowed fringe.” This...
By Ugochi Oguh, CPA
Updated 7/29/2019 Prior to the adoption of ASU 2016-14, Presentation of Financial Statements of Not-for-Profit Entities, not-for-profit entities (NFPs) were required to segregate net asset disclosures between temporarily restricted, permanently restricted and unrestricted. To reduce confusion and enhance transparency, ASU 2016-14 reduces the number of classes of net assets from the above three to two – net assets without donor restrictions and net assets with...
By Diana Miller, CPA
The Importance of Annual Budgets for Nonprofit Organizations
Sometimes the importance of writing and maintaining realistic annual budgets is not always understood -but it’s imperative for a number of reasons. For one thing, the document might find more interested readers than you suspect.
Let’s start with your co-workers. Staffers need to know when funds will be available, or whether belt-tightening might soon begin (or continue). Your budget will...
By Diana Miller
Updated 7/30/2019. Written documentation of your organization’s policies and procedures regarding accounting practices always makes sense, regardless of your line of business. But it’s particularly critical when yours is a not-for-profit organization.
While the production of such a document can be highly detailed and time-consuming, it’s worth it. And it’s a job you’ll likely only do once — or perhaps just tweak periodically as laws or conditions change.
By Vanessa Munoz
In an effort to improve financial reporting for nonprofits, the Financial Accounting Standards Board (FASB) is implementing various changes. Among these changes are how expenses are being reported.
When it comes to financial reporting, many nonprofit organizations are only required to provide expenses by their nature (i.e. salaries, travel, rent, etc.).
However, voluntary health and welfare organizations are also required to present a statement...
By Linda Curro
What’s in the price of a ticket?
For nonprofit organizations that hold fundraising events and for the people who attend them, the answer is more complicated than it might appear. It’s important to get special event reporting correct because Form 990 has specific lines on the Revenue Statement to report fundraising events.
The ticket price of every event carries two components within it – the donation amount and the entertainment benefit. Whether it’s a dinner, a cocktail...
By Linda Curro
Nonprofit organizations frequently form organically, in response to a need in the community. The people who establish and run them are usually concerned citizens and activists, passionate about the cause, but often less knowledgeable about the operational and financial aspects of running a nonprofit organization.
However, it is critical for nonprofit leaders to understand business and finance, particularly when it comes to employment tax compliance. Failure to properly...
By Linda Curro
Effective Jan. 1, 2017, New Jersey will require that all charity registrations and annual renewals be submitted digitally, using a new online filing system. In many ways, this is good news: A process that once required up to 75 pages of documents to be sent via snail mail will now go paperless, saving tons of waste. The new system also promises to streamline renewal reviews, enabling the state to more efficiently verify that the forms are completed and accurate. And...
By Diana Miller
Following several years of examination and modification, the Financial Accounting Standards Board (FASB) released its long-awaited update this month on nonprofit financial reporting. The revision is expected to transform the way nonprofit organizations categorize net assets and construct financial statements.
To prepare, nonprofit organizations should familiarize themselves with the following developments:
Phase 1 (effective for fiscal years beginning after December...