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Emily Smikal

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Your not-for-profit may prefer to avoid activities that subject it to unrelated business income tax (UBIT). But if you accept advertising or sponsorships that aren’t substantially related to your tax-exempt purpose, you may unwittingly expose your organization to UBIT liability.

person pointing at a laptop screen with another person; image used for blog post about not-for-profit's sponsorships and advertising being taxable

The rules governing these types of support are complicated, so it’s important to have a basic understanding of what is and what isn’t potentially taxable.

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Continue Reading What’s Taxable for Your Not-for-Profit’s Sponsorships and Advertising?

Cryptocurrency has gone mainstream, and if you’ve been sitting on the fence about accepting donations in virtual currency, it’s time to make a decision. But before your not-for-profit says “yes” to a Bitcoin (or other cryptocurrency) gift, make sure you understand the issues involved — including the risks.

Virtual currency = risk

Cryptocurrency refers to a decentralized form of digital currency that’s tracked in a blockchain ledger. Unlike traditional currencies, the ledger doesn’t reside with a central authority, such as a bank or government, but across public peer-to-peer networks. The value of cryptocurrencies derives in part from its scarcity. In the case of Bitcoins, for example, the supply is limited to 21 million “coins.”…
Continue Reading Cryptocurrency donations: Will your nonprofit accept them?

Collective impact projects are collaborations between not-for-profits, government, businesses and communities with the goal of achieving challenging and complicated social objectives. They can succeed in ways that simply aren’t available to individual organizations.

a collective of hands come together with red paint forming a heart; image used for blog post about not-for-profits collaborating on collective impact projects

But they also require a level of commitment your not-for-profit may not be prepared for.

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Continue Reading Collaborating on Collective Impact Projects

Not-for-profit organizations are different from for-profit businesses in many vital ways. One of the most crucial differences is that under Section 501(c)(3), Sec. 501(c)(7) and other provisions, not-for-profits are tax-exempt. But your tax-exempt status is fragile. If you don’t follow the rules laid out in IRS Publication 557, Tax-Exempt Status for Your Organization, the IRS could revoke it.

package wrapped in black bubble wrap with red label "Handle with Care. FRAGILE. Thank you."; image used for blog post about not-for-profit protecting tax-exempt status

Be particularly alert to the following common stumbling blocks.

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Continue Reading Protecting Your NFP’s Tax-Exempt Status

High-net-worth individuals donated $5.8 billion during the first six months of the COVID-19 pandemic — generous giving by most standards. This is according to a recent report, “Philanthropy and COVID-19 in the first half of 2020,” from the Center for Disaster Philanthropy and information service Candid. However, that $5.8 billion amount is deceptive, because nearly three-quarters of it came from one donor, Mackenzie Scott (the ex-wife of Amazon’s Jeff Bezos).

two women writing on papers with data and pie charts on a table; image used for blog post about not-for-profits reaching out to high-net-worth individuals for funding

In fact, a 2020 study from the Milken Institute Center for Strategic Philanthropy found that only a relatively small percentage, 36%, of the ultra-wealthy are involved in charitable giving. This may sound like ominous news for not-for-profit organizations. But there are ways to tap this group’s ample resources.

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Continue Reading Consider High-Net-Worth Individuals for Your NFP Efforts

If you’re approaching retirement, you probably want to ensure the money you’ve saved in retirement plans lasts as long as possible. If so, be aware that a law was recently enacted that makes significant changes to retirement accounts.

coins spilling out of a clear glass jar; image used for blog post about tax law changes impacting retirement savings

The SECURE Act, which was signed into law in late 2019, made a number of changes of interest to those nearing retirement.

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Continue Reading The SECURE Act and Your Retirement Savings

If your not-for-profit has lost financial support during the pandemic, you may be looking for ways to raise new revenue. But if your proposed solution is a side business, be careful. Even when business ventures are related to a not-for-profit’s exempt purpose, they can run afoul of the commerciality doctrine — and jeopardize an organization’s tax status.

woman holding hundred dollar bills fanned out; image used for blog post about commerciality doctrine for not-for-profits

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Continue Reading Not-for-Profits: Be Careful of the Commerciality Doctrine

The fourth 2020 estimated tax payment deadline for individuals is Friday, January 15, 2021. If you’re self-employed and don’t have withholding from paychecks, you probably have to make estimated tax payments. These payments must be sent to the IRS on a quarterly basis.

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Even if you do have some withholding from paychecks or payments you receive, you may still have to make estimated payments if you receive other types of income such as Social Security, prizes, rent, interest, and dividends.

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Continue Reading Is Your Next Tax Deadline January 15?