23
2018
3 ways to improve development and accounting collaboration
Communication breakdowns between your not-for-profit’s development and accounting departments can lead to confusion, embarrassment and financial problems. To ensure these two functions work well together, staffers should understand that it’s normal for their numbers to differ. Development typically uses the cash basis of accounting, while accounting departments generally follow Generally Accepted Accounting Principles. Policies for communicating the receipt of grants and pledges are critical, as are regular meetings between the two teams.
22
2018
Don’t let the “commerciality doctrine” trip up your nonprofit
The commerciality doctrine was created to address concerns over not-for-profits competing at an unfair tax advantage with for-profit businesses. Organizations that don’t pass muster could lose their tax-exempt status. Even business activities related to your nonprofit’s exempt purpose could fall prey to the doctrine. Courts consider several factors, including whether you sell to the general public, set prices to maximize profits and accumulate unreasonable reserves. Contact us before launching a revenue-generating business.
21
2018
Tax Bill Containing Technical Corrections
U.S. House Republicans have released a tax bill containing technical corrections, “extenders” and disaster relief. Released by the House Ways and Means chairman, the bill contains expiring tax provisions, technical fixes for the Tax Cuts and Jobs Act, disaster relief, retirement plans and improvements to the IRS. Finance Committee Democrats reportedly hadn’t weighed in on the bill before its release. The House could take up the bill by the end of this week,
21
2018
Happy Holidays!
HBL showing their holiday spirit dressing for the season. We would like to wish every a Happy and Safe Holiday.
Please note that we will be closed:
Monday, December 24, 2018 and
Tuesday, December 25, 2018
We will resume our regular office hours on Wednesday, December 26, 2018.
21
2018
20
2018
Does prepaying property taxes make sense anymore?
Prepaying property taxes has been a popular year-end tax-planning strategy. But does it still make sense? For many, particularly those in high-tax states, it doesn’t. The TCJA made two changes that affect this strategy: 1) nearly doubling the standard deduction, so fewer taxpayers will itemize, and 2) putting a $10,000 cap on state and local tax deductions. If you no longer itemize or you’ve already used up your $10,000 limit (on income or sales taxes or on previous property tax installments),
19
2018
How fiscal sponsorships work for established — and fledgling — charities
In a fiscal sponsorship, an established charity provides a kind of legal and financial umbrella to a charitable project that lacks 501(c)(3) status. These arrangements can benefit both larger organizations and the projects they sponsor. Small projects gain much-needed infrastructure, fiscal management and the ability to accept tax-deductible charitable donations. Sponsors gain exposure to new potential donors and enhancements to their own programs. But a poorly planned fiscal sponsorship could damage a sponsor’s finances and reputation.
18
2018
Business Interest Deduction Limit
The IRS issues proposed regulations on the business interest deduction limit. The Tax Cuts and Jobs Act generally limits the deduction to the sum of the taxpayer’s current-year business interest income, 30% percent of the taxpayer’s adjusted taxable income and certain floor plan financing interest expense. There are exceptions to the limit for small businesses whose gross receipts are $25 million or less and for certain trades or businesses. The proposed regs,
17
2018
Catch-up retirement plan contributions can be particularly advantageous post-TCJA
Will you be age 50 or older on December 31? Are you still working? Are you already contributing to your 401(k) up to the regular annual limit? Then you may want to make “catch-up” contributions by the end of the year. Increasing your retirement plan contributions can be particularly advantageous if your itemized deductions for 2018 will be smaller than in the past because of changes under the TCJA. The additional contributions can reduce your taxable income and help make up for the loss of some of your itemized deductions.
17
2018
