Why your nonprofit shouldn’t operate like a for-profit business
Even nonprofits that generally play it safe can get tripped up by the commerciality doctrine. It was created to address concerns about nonprofits competing at an unfair tax advantage with for-profits. The doctrine generally says that when some otherwise exempt activities are substantially the same as those of commercial entities, a nonprofit can risk its exempt status. Risky activities include set ting prices to maximize profits, accumulating unreasonable reserves and advertising services to the public. With these exemptions and other technicalities, it can be tricky to remain compliant. Contact the CPA's and business tax advisors at SEK to help navigate you through nonprofit tax, tax tips and other financial advice.
GASB - Upcoming changes to reporting model and basis of accounting
The Governmental Accounting Standards Board (GASB) is in the process of making significant changes to governmental financial statements and the underlying basis of accounting and has issued several documents for public comment.
A company car is a valuable perk but don’t forget about taxes
One of the most appreciated fringe benefits for owners and employees of small businesses is the use of a company car. This perk results in tax deductions for the employer and tax breaks for the owners and employees using the cars. For tax deduction purposes, a business treats the car much the same way it would any other business asset and comes with complications and paperwork. Our CPA's and Tax Advisors can help keep you in compliance with the rules. Give our accounting firm a call today for more tax tips and financial advice.
5 resolutions QuickBooks Online users should make for 2024
While you’re making plans for the new year, consider how you could improve your financial management – and maybe even your profits.
Higher interest rates spark interest in charitable remainder trusts
If you wish to leave a charitable legacy while generating income during your lifetime, a charitable remainder trust (CRT) may be a viable solution. A CRT is an irrevocable trust to which you contribute stock or other assets. The trust pays you income for life or for a term of up to 20 years, then distributes the remaining assets to one or more charities. When you fund the trust, you’re entitled to a charitable income tax deduction (subject to applicable limits) equal to the present value of the charitable beneficiaries’ remainder interest. Contact the CPA's and business tax advisors at SEK for help in establishing your CRT or for more financial advice and tax tips.
When do 501(c)(6) organizations risk their exempt status?
Not-for-profit trade associations are organized to promote the common interests of their members. But to maintain their 501(c)(6) tax-exempt status, they must observe certain rules. Your association needs to offer services that benefit your entire group or profession as a whole, not individual members. Even when services for individuals are allowed (because they’re limited in number and scope), they can trigger unrelated business income tax. On the other hand, activities such as attempting to influence legislation relating to common business interests of members and testing and certifying products are generally acceptable. The CPAs and business tax advisors at SEK can help you navigate this process.
Levels of value: Why it matters in a business valuation
A business may have more than one value, depending on the purpose of the business valuation and the characteristics of the ownership interest. Before an expert starts working on a business valuation, it’s important to discuss the appropriate level of value.
New FinCEN reporting requirement: beneficial ownership information reporting under the Corporate Transparency Act
The Corporate Transparency Act (“CTA”) was enacted January 1, 2021, as part of the National Defense Authorization Act, representing the most significant reformation of the Bank Secrecy Act and related anti–money laundering rules since the U.S. Patriot Act.
Don’t forget to empty out your flexible spending account
If you have a tax-saving flexible spending account (FSA) with your employer to help pay for health or dependent care expenses, there’s an important date coming up. You may have to use the money in the account by year-end or you’ll lose it (unless your employer has a grace period).
Naming a guardian is critical for parents of young children
If you’re the parent of young children, you’ve probably put a lot of thought into raising your kids, ranging from their schools to their activities to their religious upbringing. But have you considered what would happen to them if you — and your spouse if you’re married — should suddenly die?