MSAE

Fall 2013

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MSAE LUNCH & LEARN Latest Laws and Best Practices Presented by Charles Lindsay, CPA July 24, 2013 IRS TAX FILING • Form 990 N – Gross receipts normally $50,000 or less • Form 990 EZ – Gross receipts over $50,000 and less than $200,000 but assets less than $500,000 • Form 990 – Gross receipts greater than $200,000 or total assets of $500,000 or more Required Policies • Conflict of Interest Policy (completed annually) • Whistleblower Policy • Document Retention and Destruction Policy Recommended Policies • • • • Key Employee Compensation Policy Gift Acceptance Policy Operating Reserve Policy Expense Reimbursement Policy Hot Topics • Substantiating Charitable Contributions • Provide written statement to donors of quid pro quo contribution in excess of $75. (Example – Donor pays $100 and receives banquet ticket worth $40). • Failing to meet this requirement can result in a fine of $10 per contribution. • Deductions of $250 or be supported by a receipt from the charity and MUST state whether goods or services were provided in exchange for the payment. • For contributions over $5,000, a qualified appraisal must be obtained. • Employee vs Independent Contractor • Continues to receive IRS scrutiny • Area for additional tax and penalty revenue imposed on the Exempt Organization. MS Secretary of State Charitable Regulation {Applies primarily to 501(c)(3) organizations} 10 • • • • • • Charities raising funds from the public must be registered with the MS Secretary of State. Trade Associations are generally exempt since they usually only solicit members. Requires an audit or review report if contributions of $250,000 or $500,000, respectively. Recent scrutiny on percentage of Fundraising and Management/General Expenses. Audits are being conducted by the Compliance Division. Charities that are not in good standing are being assessed penalties for soliciting funds. CONNECTIONS | FALL 2013

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