When we talk to folks about making their visions for a nonprofit organization a reality, the most common thing that holds people back is funding. We wanted to share a success story from on of our favorite clients about how they are getting creative and making those crowdsourcing fundraising platforms like Kickstarter and Indiegogo really work for them and their organization. Give it a look and imagine what’s possible for your organization:
- Drive donors to Facebook, Twitter and other social media accounts
- Share progress photos of a school being built in the Sudan
- Raise money for a freshwater well in a remote village in Kenya
- Tell a story of a child receiving life-changing surgery in the Philippines
- Invite donors to a quarterly fundraising drive benefitting local sports teams
- Send donors a thank you video for contributing to a holiday food drive
Just a friendly reminder that if your nonprofit’s fiscal year
ends December 31st, your filings are DUE May 15th.
Filing your annual financial data with the IRS is a crucial
way to maintain your 501c3 status. You don’t want your 501c3
status to be revoked like so many nonprofits did last year.
We’re offering a discount on our nonprofit tax filing services.
Remember you must file your 990 tax filing by four and one half
months after the end of your fiscal year. Give us a call to find out more.
We will throw in handling your annual state compliance as
well as part of this special offering (your organization
will be responsible for the state filing fees).
Please call us at 800-928-4161 to discuss how we can help
your nonprofit stay compliant as tax season approaches.
We’ve recently come across an interesting brief on the nonprofit sector and thought we’d share it with you. It’s put about by the Urban Institute’s National Center for Charitable Statistics. It’s from 2007 so no doubt these numbers have changed, but it’s still compelling stuff, even at 5 years old.
For instance, did you know that there are about 1.4 million nonprofits registered with the IRS? Nonprofits account for 8.3% of the nation’s employment and 5.2% of the gross domestic product (GDP). There were $260 billion in charitable contributions and about 29% of Americans volunteered thru an organization that has been formalized (has its tax exempt status). Just think of what your organization could do with just a fractionof that support. There are some great charts on graphs in this report too that can provide invaluable information for your nonprofit in terms of targeting supporters, donors and volunteers.
What’s particularly interested us was looking at the final chart of nonprofits by state and region. It mirrored our client base in a truly fascinating way (as reflected in our client map). No matter where you are, we’re here to help your organization thrive. Don’t hesistate to let us know how we can better serve you.
We get a lot of questions from our clients about risks related to running the nonprofit, liability for the board and dealing with employeees and volunteers. For nonprofits that are working with children, have international activities, dealing with animals or doing anything that has a higher risk of accidents, you need to be thinking about creating a risk management plan. This isn’t to scare you, but to prepare you! They say about disaster preparedness that if you start preparing when the disaster starts, it’s already too late. Make sure that you and your board and staff have thought this piece through. Here are some excellent resources to help you in this journey. We’re also here to help for feel free to give us a call at 800-928-4161. We look forward to hearing from you.
Nonprofit Risk Management Center – a great place to start is this article on the difference between employees and volunteers and their book on risk mamangement for nonprofit executives.
E-volunteerism – this resource is especially useful for organizations that work with volunteers though some of the reports listed here would be helpful to just about any nonprofit.
Some of the information may be a little out of date so if you’re having a specific issue or have a specific question, check with us. We stay on top of changes in laws and IRS code so that you don’t have to.
Are you an executive director of a nonprofit based in San Francisco who wants to improve your leadership and management skills? Enhance the capacity of your organization? Build collaborative relationships with other nonprofit leaders? If yes, LeaderSpring invites you to apply to a two-year, on-the-job Fellowship program. Information sessions are taking place in August and applications are due Friday, September 2nd, 2011. For more information, visit the LeaderSpring website.
We receive a lot of questions about insurance, so I want to
introduce you to an insurance specialist, Shanika Gunesekera to
address your questions and insurance needs. I find her to be a
person of integrity and truly interested in serving her clients.
Here is something she wrote to get you thinking about insurance
issues. She is also happy to answer your questions at her email or
telephone number below.
Risk Management requires proactive planning to avoid or to limit
potential losses. Unfortunately, many non-profit organizations
consider buying insurance as simply a reaction to regulation and
outside requirement. However, losses do happen, and can vary from a
fire that destroys a building to a non-profit’s Board of Directors
being sued. Some of these losses can be large and even threaten the
survival of a non-profit institution. The function of an insurance
program is to indemnify you and your non-profit in the event of an
insurable loss, and help the non-profit set up loss control
procedures to prevent costly accidents from ever happening.
As a non-profit organization, a few questions to consider are:
1)Volunteers are the backbone of most non-profit organizations.
Are they covered if they are hurt while volunteering?
2)Lawsuits against Board Members have been increasing at a
shocking rate. Does your organization have a substantial ‘Directors
& Officers’ (D&O) policy?
3)Has anyone from your organization been fired? Employment
practices claims are one of the most prevalent source of litigation
in the non-profit sector today. Does your organization have
4)Do employees who reconcile the monthly bank statements also
either sign checks or handle deposits ?
5)Do your employees use their own vehicles for work?
6)Does the public have access to fine art or internal premises,
where theft can take place due to inadequate security?
7)If your non-profit organization has several different
locations, are they all scheduled on the declaration?
8)If you provide a service such as counseling and medical/legal
advice, do you have sufficient Errors & Omissions or Malpractice
9)Are you getting the best coverage for the most competitive price?
While insurance may not be at the top of most non-profit’s list of
priorities it is important to make sure your non-profit is
sufficiently covered. A comprehensive insurance program will ensure
that in an event of an insurable loss your organization can get
back on its feet, with minimal delay, to continue the valuable work
that you do.
If you have questions about insurance for your non-profit, you can
speak with an insurance specialist, Shanika Gunesekera at
650-227-7227 or e-mail her at firstname.lastname@example.org. She can answer
The Internal Revenue Service today announced that it has released a listing of approximately 275,000 organizations that under the law have automatically lost their tax-exempt status because they have not filed annual reports as legally required for the past three years. If an organization appears on the list of auto-revoked organizations it is because IRS records indicate the organization has a filing requirement and has not filed the required returns or notices for 2007, 2008 and 2009.
The IRS has issued guidance on how organizations can apply for reinstatement of their tax-exempt status, including retroactive reinstatement. In addition, the IRS announced transition relief for certain smaller tax-exempt groups – those with annual gross receipts of $50,000 or less for 2010 and eligible to file Form 990-N, the e-Postcard. The relief allows eligible revoked groups to gain retroactive tax-exempt status and pay a reduced application fee of $100 rather than the typical $400 fee. More information, including FAQs and a Fact Sheet, can be found on the IRS website.
We get a lot of questions from people who have a family member or a friend who has an illness. Our heart goes out to those families and communities dealing with illnesses of all kinds. We appreciate that so many people want to help by holding fundraisers to help their loved ones with medical and living expenses.
Unfortunately, a 501c3 nonprofit organization needs to benefit an entire class of people rather than just a single individual. If you wish to start an organization to help many people living with cancer or other disease in your community, we’re able to help. If you want to just focus on a particular individual, we recommend consulting with the hospital about the best route to go. Many have programs to help people help patients. Your bank can often advise you on the best accounts to set up for the funds raised.
Contributions to a nonprofit earmarked for a specific individual are allowed and appreciated, however these donations are not tax deductible. The donation is considered a gift to an individual and are not tax deductible.
Most nonprofit organization’s seek 501c3 status from the IRS as it provides the most tax benefits. 501c3 nonprofits can apply for grants and provide tax deductible receipts to people who support the organization with donations. 501c3s are limited in their ability to lobby so if you want to do explicitly political work most of the time then another type of 501c would be appropriate. 501c4 organizations can participate in political campaigns and electoral politics to an unlimited extent, but donations made are not tax deductible.
We’ll cover the difference between public charity and private foundation 501c3 organizations in another post shortly so stay tuned.
These are a couple of good resources that may help clarify which type of nonprofit your organization is. If you’re still not sure, give us a call for your free 20 minute consultation at 800-928-4161.
IRS Tax Exempt Reference Chart: http://www.nonprofitlegalcenter.com/nonprofit-resources/tax-exempt-organization-chart.html
Common Nonprofit Definitions
501c3: Religious, Educational, Charitable, Scientific, Literary, Testing for Public Safety, National or International Amateur Sports Competitions, Prevention of Cruelty to Children or Animals Organizations.
Charitable contributions are tax deductible. Limited ability or restrictions to lobbying.
501c4: Civic Leagues, Social Welfare Organizations, and Local Associations of Employees.
Charitable contributions are NOT tax deductible. Unlimited ability to lobby for legislation and the ability to participate in political campaigns and elections.