Guest post by Julleen Snyder, Partner, Jacobson Jarvis
For the past five years, we have partnered with Jacobson Jarvis to help board members learn what they need to know about nonprofit finance. As you can see in this guest post, Jacobson Jarvis connects you with practical information and tools so you can focus on your mission. Join Washington Nonprofits and Jacobson Jarvis for Finance Unlocked for Nonprofits online on October 30 or in person on October 1 in Everett or October 31 in Bellevue. Our Quickbooks class will run in Seattle on December 5 and online on December 10-12.
When you’re working for a nonprofit, whether you are on a calendar year or a fiscal year, membership renewals, fundraisers, tax forms, and audits can make the final few months a stressful time. Here are five tips you can use now in order to stay ahead of the game and prepare for your nonprofit’s accounting year end.
Complete Essential Forms
Wrapping up the end of your nonprofit’s accounting year means making sure that all the proper forms, tax and otherwise, are filled out and all loose ends are tied up.
Form 990 is required for all organizations exempt from income tax under section 501(a) and certain nonexempt charitable trusts. This form becomes available for public inspection and reports on your organization’s finances, governance, compliance with tax filings, and compensations paid. More information on Form 990 can be found on the IRS website.
If your organization pays over $600 to vendors or nonemployees for services during the fiscal year, you will need to file a 1099-MISC to report that spending. More information on Form 1099-MISC and information return forms can be found on the IRS website as well.
Grant Applications or Proposals
If you have any unfinished grant applications or proposals due, review the application process and gather the required materials in order to send those off. Grants are an extremely important form of funding for nonprofits, and opportunities for government funding can be found through your organization’s board and various online resources.
Continue the practice of filling out and sending contribution statements to donors, completing your quarterly Form 941, and prepping for your organization’s Form W-3 and Form 1099 for the beginning of next year.
For a list of all tax forms that your charitable or tax-exempt organization needs to have completed, check out the Charities and Nonprofits page on the IRS website.
Clean Your Accounts and Balance Your Books
At the end of the year, your nonprofit will want to make sure that no outstanding balances exist, and that all relevant accounting information is organized and accessible. Review your accounts and purge any inactive accounts, being sure to move data from inactive accounts to a spreadsheet in case you need to reference it in the future.
Gather and organize all materials needed for any year-end audits taking place, and make sure the books that include revenue and expenses are balanced.
In the months leading up to the end of the year, look at your monthly checklists as pseudo-end-of-year tasks. Organizing a year month-by-month is less stressful than having to make accounting adjustments for an entire year all at once.
Review and Update Your Budget
The end of the accounting year is a perfect time to review your budget for last year and see where you excelled and where you might have fallen short. Allow the facts of last year’s budget to guide you to what might work best in the future.
Plan for End-of-Year Fundraising
With nearly one-third of annual giving taking place in the month of December, beginning the plans for end-of-year fundraising is one of the smartest things your organization can do. Brainstorm effective ways to spark excitement about your mission and inspire targeted giving in the months ahead.
Reach Out to Members
During these hectic months, things may seem hyper-focused on forms and money. Thanking your members for their contribution and making yourself available for questions or feedback is a great way to keep a close connection and retain membership for the coming year.
Julleen Snyder, Partner, has been with Jacobson Jarvis since February, 1995. She has both practical experience within a not-for-profit organization, as well as a solid background in accounting and nonprofit auditing. This multi-disciplinary experience provides her with a unique perspective of the clients’ issues combined with the ability to implement timely, appropriate solutions.