Nonprofit Tax and Accounting

Fundamentals for Humanitarian Organizations

Todd ManwaringManaging Director

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Agenda

Introductions Part I: What Are We Trying To Do?

Pre-Test Start with the end in mind: What do the state and

federal government want to know? What information do we need to keep?

Part II: Financial Information Examples / Practice

Part III: Non-Financial Information Examples / Practice

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Levels of Tax & Accounting

1. Do it yourself – have a friend help you2. Solicit an accounting person to review your

work (volunteer, board member)3. Hire consultants to help:

Bookkeepers Tax Preparation Auditing

4. Hire internal employees

This workshop covers FUNDAMENTALS ONLY

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Pre-Test

Match These Forms Provo Business License Application IRS Form 1099-MISC Utah Registration Information Change

Form IRS Form 990 or 990EZ IRS Form 1023 IRS Form 990 Schedule A IRS Form 8718 Utah Charitable Organization Permit

Application Form Bylaws IRS Form SS-4 IRS Form 872-C Utah Annual Report / Renewal Form IRS Determination Letter IRS Form 1096 IRS Form 990 Schedule B Articles of Incorporation Utah Form TC-146

To These Activities Forming the 501(c)3

IRS Recognition of 501(c)3

State Recognition of 501(c)3

Yearly Activities (Jan-Feb)

Yearly Activities (Accounting Period)

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Pre-Test

Match These Forms IRS Form SS-4 Articles of Incorporation Bylaws IRS Form 1023 IRS Form 8718 IRS Form 872-C

IRS Determination Letter

Utah Form TC-146 Provo Business License Application

IRS Form 1096 IRS Form 1099-MISC

IRS Form 990 or 990EZ IRS Form 990 Schedule A IRS Form 990 Schedule B Utah Charitable Organization Permit Applica

tion Form Utah Annual Report / Renewal Form Utah Registration Information Change Form

(if needed)

To These Activities Forming the 501(c)3

IRS Recognition of 501(c)3

State/Local Recognition of 501(c)3

Yearly Activities (Jan-Feb)

Yearly Activities (Accounting Period)

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Forms IRS And Utah Want?

IRS Form 1096 IRS Form 1099-MISC IRS Form 990 or 990EZ IRS Form 990 Schedule A IRS Form 990 Schedule B

Utah Charitable Organization Permit Application Form

Utah Annual Report / Renewal Form Utah Registration Information Change Form (if

needed)

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IRS Form 1096 & 1099-MISC

Often forgotten; required early in year. Form 1096 is a summary form of your 1099s. Normally, the IRS just wants to know about non-

employees that you paid over $600 to. Instructions

http://www.irs.gov/pub/irs-pdf/i1099msc.pdf

Employees reported via IRS Form 941 and its companions (quarterly and yearly).

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IRS Form 990EZ/990, Schedule A/B

These are your yearly tax statements – due after organization fiscal year.

They are used by others as well (state, grantors, donors)

All of the information is public except parts of Schedule B

Instructions http://www.irs.gov/pub/irs-pdf/i990-ez.pdf http://www.irs.gov/pub/irs-pdf/i990sa.pdf

What is the IRS trying to determine?

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Utah Annual Report RenewalUtah Registration Information Change

Often forgotten; required at anniversary of organization

Keeps your corporation “active” with state Allows simple changes to corporate location,

agent, governance Much of the information is public

What is the State of Utah trying to do?

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Utah Charitable Organization Permit Application Form

Usually forgotten; required annually Part of the Division of Consumer Protection Keeps solicitation information current with Utah Some of the information is public Instructions

http://www.commerce.utah.gov/dcp/downloads/permitapps/charitableorganizationinstructions.pdf

What is the State of Utah trying to do?

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What Information Do We Keep?

Financial: Categorized Income, Expenses, Assets, Liabilities Ledgers/Spreadsheets/Quicken/Money

• Do it yourself – have a friend help you• Solicit an accounting person to review your work

(volunteer, board member) Professional Accounting Packages (Quickbooks on up)

• Solicit an accounting person to review your work (volunteer, board member)

• Hire consultants to help• Hire internal employees

Non-Financial

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Other Items to Remember

Local business license renewals Donor receipts – especially over $250