As the COVID-19 pandemic continues, various not-for-profit organizations have experienced a decline in charitable contributions from supporters, and Congress responded with a new provision in the Coronavirus Aid, Relief, and Economic Security (CARES) Act – Public Law (P.L.) 116-136.

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This provision aims to provide relief to charitable organizations. Under Section 2204, the provision allows

Jen: This is the PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, and I’m back again with Carlos Gomez, an audit manager and one of the faces of the PKF Texas Contract Compliance Services team. Carlos, will come back to the Playbook.

Carlos: Thanks, Jen.

Jen: Carlos, in previous editions we’ve talked about vendor management audits. What are those and how do those help a company in this type of situation?

Carlos: Typically, our clients benefit from having some visibility into their vendors with a vendor audit. It will help you identify any key issues and maybe recover some expenses that you happened to lose that weren’t in line with the agreement.

Jen: So, how does a vendor audit actually work?


Continue Reading What to Know About a Vendor Audit

Does your private foundation have a detailed conflict-of-interest policy? If it doesn’t — and if it doesn’t follow the policy closely — you could face IRS attention that results in penalties and even the revocation of your tax-exempt status.

Image of a paper document shaped as a question mark with the words "conflict-of-interest policy;" used for blog post about private foundations needing a conflict-of-interest policyHere’s how to prevent accusations of self-dealing.
Continue Reading Why Foundations Need Strong Conflict-of-Interest Policies

Employees or independent contractors? It’s not only for-profit companies that struggle with the question of how to classify workers for federal tax purposes. Not-for-profit organizations must withhold and pay Social Security, Medicare and unemployment taxes for employees, but not for contractors. (There may also be state tax responsibilities.)

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But be careful before you decide that most of your staffers must be contractors. The IRS may not agree.


Continue Reading How to Classify Your NFP’s Workers for Tax Purposes

If you’re getting close to retirement, you may wonder: Are my Social Security benefits going to be taxed? And if so, how much will you have to pay?

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It depends on your other income. If you’re taxed, between 50% and 85% of your benefits could be taxed. (This doesn’t mean you pay 85% of your benefits back to the government in taxes. It merely that you’d include 85% of them in your income subject to your regular tax rates.)


Continue Reading Paying Tax on Your Social Security Benefits

Not-for-profits increasingly are adopting a corporate world tool: financial dashboards. A dashboard is a summary of an organization’s progress toward a specific goal over time — or a snapshot of its current situation.

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Dashboards are designed to help boards and other constituents visualize important metrics, or key performance indicators (KPIs). But to facilitate informed, timely decisions, it’s critical to select the right KPIs.


Continue Reading How Financial Dashboards Help Your NFP’s Financial Success

While you probably don’t have any problems paying your tax bills, you may wonder: What happens in the event you (or someone you know) can’t pay taxes on time?

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Most importantly, don’t let the inability to pay your tax liability in full keep you from filing a tax return properly and on time. In addition, taking certain steps can keep the IRS from instituting punitive collection processes.

Here’s a look at the options.


Continue Reading Can’t Pay Individual Taxes? Here’s What to Know

Current financial pressures mean that your not-for-profit probably can’t afford to pass up offers of support. Yet you need to be careful about blindly accepting grants. Smaller not-for-profits that don’t have formal grant evaluation processes are at risk of accepting grants with unmanageable burdens and costs. But large organizations also need to be careful because they have significantly more grant opportunities — including for grants that are outside their current expertise and experience.

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Here’s how accepting the wrong grant may backfire in costly and time-consuming ways.


Continue Reading Considerations When Accepting New Grants for Your NFP

If your business was fortunate enough to get a Paycheck Protection Program (PPP) loan taken out in connection with the COVID-19 crisis, you should be aware of the potential tax implications.

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The Basics
The Coronavirus Aid, Relief and Economic Security (CARES) Act, which was enacted on March 27, 2020, is designed to provide financial assistance to Americans suffering during the COVID-19 pandemic. The CARES Act authorized up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April, Congress authorized additional PPP funding and it’s possible more relief could be part of another stimulus law.


Continue Reading PPP Loans Can Have Tax Consequences