As a Not for Profit company you have many special demands placed upon you. With the pressure of raising funds to the special reporting demands of the IRS and funders, running a Not for Profit business can be challenging to say the least.
As many nonprofits don't have a trained bookkeeper on staff, the preparation of financial statements and fulfillment of reporting requirements goes to whoever has the time and the willingness to do it. Lack of accounting training or background is not only frustrating for the individual, but also potentially risky for the nonprofit.
If your Not for Profit organization is like many, you know how difficult it is for you to maintain the increasing financial reporting requirements as you expand your programs and increase your fund raising efforts.
Many people are shocked when they realize just how much regulation, filling, and paperwork comes with a tax exempt status.
There are few direct regulations that state how nonprofit organizations must operate their internal financial record keeping. However, there are indirect influences such as IRS and most funding agencies that will impose certain requirements. In practical terms, these "recommended" standards all but demand certain accounting and other financial practices be followed by nearly all nonprofit organizations.
The IRS requires most tax-exempt organizations to submit an annual information report, the Form 990 and its relations, which requires a significant amount of financial reporting where specific categories and classes of revenue and expenditures must be allocated.
The the IRS has been focusing on exempt organizations which calls for “Proactively addressing misuse of tax-exempt organizations and/or tax-exempt status.”
Other aspects of the reporting requirements are more complex than would be required in a small commercial business. The report of expenses for individual program services roughly corresponds to more complex divisional accounting methods, for tracking expenses incurred by different segments of an organization's total operation. Also, unlike commercial reporting, the IRS uses revenue classifications to help determine if a nonprofit organization will retain its tax-exempt status recognition.
Any organization that does not focus its accounting system around the specified categories and classes will face serious hurdles preparing its annual IRS report.
Organizations that ignore their financial reporting obligations do so at their own peril because at some point a Board member, a funder, or even the IRS will ask something like, "How much was spent on this program?" or, "What were the specific sources of all revenue?" Getting those answers-largely depends on who does the bookkeeping.
Mother Lode Bookkeeping, Inc. is an experienced bookkeeping and tax firm with nonprofit expertise. We can help you make sure that income and expenses are being properly categorized for tracking and reporting purposes. These reports include:
- A statement of revenue & expenditures with particular categories specified (e.g. salaries, postage, rental revenue & expenses)
- A statement of assets, liabilities, and fund balances with categories specified (e.g. cash, accounts receivable, etc.)
- A statement of functional expenses, allocated to program services, operations, and fundraising
- A report of expenses segregated by individual program service (e.g. educational mailings, seminar programs)
- A support schedule that details the organization's sources of revenue, with particular categories specified (e.g. charitable donations, membership fees, investment income)
We are also a full service firm which can form a solid foundation for your Not for Profit business. You can customize our package of services you receive by adding payroll, tax planning, tax preparation, or any of our other business services.
Here is what you Receive
- Your tax return will be carefully checked by our expert staff and our computer software identifying potential problems the IRS and states may look at more closely, and reviewing the math to limit IRS and state contact.
- Most tax returns can be filed electronically so you will get a quicker refund and be secure that the IRS and state has received your return.
- The expertise of our Enrolled Agents affords us to specialize in taxation and attend frequent tax seminars to enhance our mastery of complex tax codes and regulations.
- Valuable advice on how to legally reduce your tax liability, including recommended tax saving strategies to minimize your tax liability.
While our fees are typically fixed, they are based on the effort it takes to complete the job. To get an accurate estimate, we will need to see the actual source bookkeeping information (i.e. bank statements, credit card statements, check register, etc.). To determine a rough estimation we can use the number of transactions that will need to be processed for the accounting period covered (month or quarter). For this estimate, use $3 per transaction. For an example of how our bookkeeping fees are applied, see below.
|20 Checks @ $3.00/ea||$ 60.00|
|10 Credit Card Transactions @ $3.00/ea||30.00|
|5 Journal Entries @ $3.00/ea||15.00|
|Total Periodic Fee:||$105.00|
Our minimum periodic fee is $80.00.
For tax preparation purposes, fees will vary based upon the complexity of the return produced, but below is our standard rates bases on an average Not for Profit information return:
Post Card Filing: $200
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*The accounting services provided by Mother Lode Bookkeeping, Inc. and its employees do not require a state license.