Death and Taxes: What Nonprofits Need for their 990 Filing
By Dustin McKissen, December 29, 2016
It’s the end of the year, and for nonprofits that means tax
And like the saying goes, filing your taxes is one of life’s
Kind of like death.
Okay, filing your nonprofit’s 990 isn’t that dramatic—but if
you’re not prepared, it can take far more time and resources than it needs to.
Here are a few things you need to have on hand to make filing your 990 easier
· Minutes: While
you do not file minutes as a part of your 990, information contained within
your minutes can provide fast answers for some of the questions the 990 asks. Should
you ever be questioned by an auditor, minutes also serve as valuable backup.
Luckily, we know a company that makes creating accurate minutes easier
and faster than ever before.
Policies: Conflict of Interest, Gift Acceptance, Whistleblower, and Records
Retention and Destruction policies are a requirement, and your 990 will ask if you
have them in place. If you don’t have any one of these policies, adopt it
quickly—and BoardPaq provides a
fast and easy way for your directors to review and approve policies.
Information: When filing your 990, remember to have your list of officers,
directors, trustees, and key employees, a list of contributors, grants paid,
schedule of events and activities, graph of revenues, the eye color of your
firstborn child, your fourth grade teacher’s middle name, and the willingness
to disclose all of the Facebook groups you belong to.
Those last three are jokes, but this is the
IRS—they want a lot of information on where your money came from, where that
money went, and who is empowered to make those decisions. Make sure you have
that information on hand.
As an ex-nonprofit executive, I hated tax time. Part of that
was because I’m not a finance guy, but the other reason I didn’t like the 990
was because it was a non-value-added activity. Time spent with IRS forms and
accountants was less time I could spend helping my organization achieve its mission.
But, even though I hated doing it, taxes are inevitable.
That said, as a nonprofit executive I would have jumped at
the chance to reduce time spent on activities that didn’t directly advance the
mission or help the organization grow.
Activities like preparing meeting binders, creating minutes,
and drafting agendas.
If I or my staff had been spending less time punching holes
in paper and more time serving our stakeholders, we would have been doing a
little more good for the world.
BoardPaq, the board portal of choice for a growing number of
charities, associations, school districts, and other cost-conscious
organizations, gives nonprofit staff the chance to focus more of their time on
activities that add value.
But while BoardPaq can do those things and more for a nonprofit, the
platform isn’t a miracle worker.
You still have to do your taxes.