Online Stewardship Accounting & Consulting Services

To administer productive programs worthy of your not-for-profit’s budget, you need to determine whether they’re meeting clients’ needs. In general, the best way to assess this is by surveying participants. But survey fatigue — frustration or disinterest when asked to take yet another online survey or one that’s overly complicated or takes too long to complete — is a real and growing problem.

Multiple studies have found that survey fatigue results in low response rates as well as inaccurate or low-quality responses from those who do complete them. Survey participants may doubt that your organization will even review their responses or make meaningful changes based on them. Given such challenges, how can you effectively gather client opinions?

Go “old school”

Each encounter with a client is an opportunity to solicit feedback. So while you’ll want to include online surveys with your email newsletters and request feedback on your website and social media platforms, don’t neglect “old school” techniques. Pull aside clients while working in the field or call them on the phone to ask how they’re doing and what, if anything, they’d change about your programs. When you receive verbal feedback, follow up in writing so you have a record of the conversation and can easily share it with others in your organization.

Platforms such as Facebook and Instagram are free and likely frequent destinations for many of your clients. You can use their survey tools to regularly invite viewers to leave comments about your posts — or even ask them to recommend or write a review of your nonprofit. But also provide an email address or SMS number for texts so that clients can contact you directly if they want to discuss issues in depth.

Also keep in mind that, depending on the population you serve (for example, lower-income or elderly people), not all clients may have easy internet access or use social media accounts. You might want to offer them paper surveys, or even an old-fashioned suggestion box.

Show appreciation and act

Thank your clients for every communication and, when possible, let them know how you’re using their feedback to address shortcomings and make improvements. In some cases, you may want to schedule one-on-one meetings or focus groups where you can discuss plans in greater detail and let clients know how valuable they are to the decision-making process.

Also be sure to follow up on any problems surveys unearth. For example, if clients complain about staffers acting unprofessionally or hint at potential legal issues (such as fraud or discrimination), investigate and address those issues immediately. You should also consult your nonprofit’s attorney if surveys uncover any potential legal problems.

Deliver superior outcomes

Ultimately, gathering meaningful feedback from clients and acting on it allows you to fund programs that deliver superior outcomes. Online surveys can be useful, but keep in mind that you may get better and more insightful feedback by talking to clients one-on-one. Contact us if you have questions about budgeting and spending.  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Wednesday, July 24th, 2024
Comments Off on Gather information from clients without triggering survey fatigue

In 2023, Indiana University’s Lilly Family School of Philanthropy released a public opinion survey that provided both good and bad news for nonprofits. Although the respondents said they trust philanthropic organizations more than government and businesses, 30% believe that not-for-profits are on the “wrong track.” Only 18% say charities are on the “right track.” (The rest of the surveyed individuals were undecided.)

Obviously, you want your nonprofit, the decisions its leaders make and the programs you offer to be trusted and respected. It’s critical to raising funds and fulfilling your mission. So if you’re worried your organization is losing its luster with the public, here are some suggestions.

Keys to weathering negative perceptions

Some perceptions are difficult, if not impossible, to influence due to factors beyond your control. But there are proactive ways to manage your organization’s reputation that will help it weather unexpected crises — and even just general negative public attitudes:

Be transparent with your constituencies. This means keeping stakeholders abreast of the latest fundraising facts and figures, how you’re using the money and progress you’re making toward your stated goals. If the only time you communicate with the public is when you need to raise funds or renew memberships, you’re missing prime reputation-building opportunities.

Enlist the help of staff and volunteers. Your executive director or president may be the official voice of your organization, but remember that every time staff members or volunteers act on behalf of your nonprofit, they’re representing your organization as a whole. Be sure they understand this and provide them with the training they need to put your nonprofit in the best possible light.

Watch out for backlash. When other nonprofits make headlines for squandering funds or other perceived acts of mismanagement, your own organization may feel some of the heat. Don’t be surprised if you become subject to media or donor backlash. Be prepared to explain the system of checks and balances you follow to prevent similar negative events. This also may present an opportunity to spotlight the transparency of your financial operations, as evidenced by your annual report, newsletters and website.

Letting go of what you can’t control

If you run your nonprofit with openness and “walk the talk,” then you’re probably doing the best you can for donors, clients and other constituents. However, some people may still reject your mission or public statements. It’s probably not worth your time to try to win over these cynics — just cut your losses and move on to other objectives.  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, July 2nd, 2024
Comments Off on Combatting negative public perceptions of your nonprofit

Alternative investments may appeal to your not-for-profit because they often offer higher long-term performance than traditional securities do. But these investments can come with tax liabilities. They also typically are riskier, which may not be appropriate for your organization. Here’s what you need to know.

No easily ascertained value

Alternative investments generally are defined in contrast to more traditional securities, such as stocks, bonds and mutual funds. They generally don’t have an easily ascertained fair market value. Examples include hedge funds, private equity, real estate, venture capital and cryptocurrency investments.

Alternative investments may provide investors with access to high-growth companies in cutting-edge industries. However, because alternative investments may be illiquid, investors typically can’t easily cash out or shift their allocations. This can be a substantial risk to nonprofits without other sources of available operating capital. The complex nature of such assets also increases risk to the investor, which is why returns may be higher.

Pay attention to fees

Alternative investment funds generally are formed as partnerships or limited liability companies (LLCs). Both are types of pass-through entities, meaning the income and the tax liability pass through to investors, who are considered partners or members.

Manager selection is crucial — you want someone with a proven track record and access to the best investments. Pay attention to management fees. In addition to a base management fee (generally about 1.5% to 2% of the fund’s capital or net asset value), managers generally charge performance-based fees known as carried interest. These fees can reach as high as 20% or more of an alternative investment’s profits.

Unrelated business income

Although investment income (for example, dividends, gains and interest) typically is excluded from taxable unrelated business income (UBI), investors in partnerships or LLCs are treated as though they’re conducting that entity’s business. As a result, distributions of income may be treated as taxable UBI.

In addition, UBI includes unrelated debt-financed income from investment property in proportion to the debt acquired to purchase it. The IRS defines debt-financed property as any property held to produce income (including gain from its disposition) for which there’s an acquisition indebtedness. If you use financing to invest in a fund — or, if the fund has financed the purchase of an income-producing asset — some of the associated income may be taxable.

Pass-through entities report each partner’s or member’s share of income, dividends, losses, deductions and credits on IRS Schedule K-1. Nonprofits can use the schedule to determine if they’ve received UBI income that must be reported. State taxes may also apply.

Right for your organization?

We can help you decide whether alternative investments might be right for your organization. If you choose to adopt this investment strategy, we can also help you determine any tax liability.  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, June 18th, 2024
Comments Off on Weighing potential risks and returns of alternative investments

Comprehensive risk management is one of the primary responsibilities of not-for-profit leaders. You probably regularly consider and act to mitigate risk to your facilities and assets and your staffers and clients. What about your volunteers? Even though the federal Volunteer Protection Act of 1997 provides some protection, volunteers face the real risk of being sued for actions while working for your organization. They also can become subject to tax liabilities.

State by state

The Volunteer Protection Act offers some degree of defense for volunteers acting within the scope of their responsibilities. And many states have passed similar laws to shield volunteers. But liability can vary significantly from state to state, with different limits, conditions and exceptions such as broad coverage in the absence of willful or wanton misconduct vs. coverage only if the nonprofit expressly assumes liability for claims in its articles of incorporation.

Volunteer protection laws, however, don’t preempt the need for your nonprofit to buy appropriate insurance coverage. In fact, some state laws explicitly require nonprofits to carry insurance to limit volunteer liability.

Insurance coverage

To minimize risk, your organization should carry general liability insurance that specifically covers volunteers, as well as directors and officers liability insurance. If volunteers will operate vehicles for your organization, check whether your auto insurance covers them. Larger organizations might consider amending their bylaws to include a broad indemnification clause for volunteers when the claims against them exceed insurance limits.

Also consider implementing processes and procedures to control the risks of harm or injury caused by volunteers. For instance, devote time upfront to screen and train volunteers appropriately and restrict certain client-facing activities to paid staffers.

Inadvertent taxable income

Another risk is that federal or state taxing authorities might come after your volunteers because of their activities. For example, your nonprofit could inadvertently create taxable income for volunteers if it provides them with benefits such as services or compensation beyond reimbursements for actual out-of-pocket expenses incurred. In fact, reimbursements that exceed actual expenses are taxable.

If your volunteers sometimes need to cover costs with their own money that you subsequently reimburse, inform them beforehand — in writing and verbally — that they must provide receipts of their spending on your organization’s behalf. This may seem burdensome to people just trying to do some good, so explain that it’s for both your and their protection.

Protecting everyone

Volunteer risk varies by nonprofit. But it’s particularly significant with nonprofits that provide medical services or work with vulnerable populations. Even such simple tasks as driving can result in litigation. So make sure your hardworking volunteers aren’t a risk to themselves or to your nonprofit’s important mission. Consult an attorney for any legal advice.  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, June 4th, 2024
Comments Off on Are your volunteers risking legal and tax liability?

The United States is entering the most natural-disaster-prone time of the year. Tornadoes are most likely to occur in May, and the Atlantic hurricane season starts on June 1. Not-for-profits that provide aid to disaster victims — whether it’s medical care, food, clothing, shelter, cash or rebuilding assistance — are gearing up for potential emergencies. But if your organization operates in this space, know that when dispensing aid you must observe certain IRS rules.

Defining charitable activities

Disaster relief organizations are allowed to provide short-term emergency assistance and long-term aid to help ensure victims have necessities. Relief may also come in the form of cash grants or vouchers. Providing such relief to individuals qualifies as a charitable activity because it aims to relieve human suffering.

However, your nonprofit must assist a “charitable class.” A charitable class should be either large enough that the potential beneficiaries can’t be individually identified or sufficiently indefinite that the community as a whole, rather than a pre-selected group of people, benefits. In addition, you must apply needs-based tests, meaning you can’t distribute aid to individuals just because they’re disaster victims. Decisions about how funds will be distributed must be based on an objective evaluation of needs at the time grants are made.

But practicality and sympathy for victims’ immediate plight can be considered. For example, take a charity that distributes blankets and hot meals to natural disaster victims. In the immediate aftermath of a storm, the charity doesn’t ask victims for proof of financial need. However, as time goes on and victims and their community begin to recover, it may be appropriate to conduct individual financial needs assessments.

Aiding businesses

In addition to helping individuals, your charity generally can provide disaster aid to businesses, so long as two conditions are met:

1. Assistance must be reasonably related to the accomplishment of a tax-exempt purpose. Businesses aren’t members of a charitable class and can’t, therefore, be appropriate charitable objects. However, distributing aid to them can achieve charitable purposes, such as preventing community deterioration or reducing the burden on local government.

2. Any private benefit to businesses must be incidental. An eligible business might not have adequate resources, conventional financing or insurance coverage that would enable it to recover from a disaster. Disaster aid organizations also need to determine that businesses they assist wouldn’t be able to remain in the community without their intervention.

Maintaining records

To prove your organization’s compliance with IRS rules, maintain good records. Document amounts paid, the purpose of payments and evidence that payments were made to meet charitable purposes and victims’ needs. In addition, document:

• Your organization’s objective criteria for disbursing assistance,
• How specific recipients were selected,
• Names and addresses of recipients and the amounts supplied to them,
• Any relationship between recipients and your charity’s officers, directors, key employees or substantial donors, and
• The composition of the selection committee approving assistance.

Note an exception: Organizations distributing short-term emergency assistance aren’t expected to record the names, addresses and amounts provided. Instead, document the date, place and estimated number of victims assisted.

Other rules may apply

There are other IRS rules that might apply to your nonprofit’s situation. Contact us if you have questions about complying with rules for tax-exempt organizations.

© 2024

Filed under: disaster relief by OSA&C Tuesday, May 21st, 2024
Comments Off on Disaster relief charities: Know the rules before providing aid

For many not-for-profit organizations, maintaining a full and active board of directors is challenging. If your board holds frequent meetings, has high attendance expectations and requires members to do considerable “homework,” you may have trouble recruiting and retaining people. Qualified individuals generally are busy with work, family and other activities and may not have spare time to dedicate to all the duties expected of board members. But if you segment responsibilities into committees, you can help ease the burden on board members — and retain them longer. Committee work has other benefits as well.

Reduced workload and increased investment

A common and effective way to segregate board responsibilities is by function, such as finance, fundraising and governance. In addition to potentially reducing board member workload, committee work enables members with specific talents or expertise (for example, financial, legal, marketing and IT) to dig in and directly apply those skills. If you want to upgrade your nonprofit’s IT network, why not turn the task over to a technology committee of members who can use their experience and knowledge to research and select new hardware and software?

Dividing board work into committees can help you recruit new members as well. For example, an otherwise reluctant physician may be encouraged to join a nonprofit hospital board if one of the committees is working to introduce protocols the doctor advocates. Committees can also help orient new members — allowing them to work closely with committee mentors and become invested in your organization’s activities.

Work of a dedicated group

For an example of how you can make the most of committee work, let’s look at a board member nominating committee. Nominating committees usually assess board membership needs, collect candidate names, interview prospective members and make recommendations.

To help in recruiting, the committee might prepare a summary for prospective candidates that briefs them on such topics as your organization’s mission and key programs, its history and evolution, and board member duties and possible committee assignments. After interested candidates have had the opportunity to review the summary, committee members can offer to answer questions or clarify points. If candidates wish to proceed, the members can arrange interviews with the full committee or with individual committee members. The committee then can recommend the best candidates to the full board for a vote.

This process enables board members who are particularly interested in recruiting to fully immerse themselves. At the same time, those board members whose interests lie elsewhere can avoid the long hours involved in searching for new members.

Permanent and ad-hoc

Although some committees may become permanent fixtures to your board (such as executive, finance and nominating), you can also set up temporary, ad-hoc committees. For instance, if you’re planning to build a new facility, you might establish a committee to oversee the project from site selection to opening day. Contact us for more information — or, possibly, if you’re looking for a board member with accounting expertise  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: board, committee by OSA&C Tuesday, May 7th, 2024
Comments Off on Board committees can help members make time for critical work

There are many reasons why a 501(c) tax-exempt organization might consider restructuring. For example, a financially struggling nonprofit might decide to join forces with another organization to cut costs and share resources. Or a nonprofit might decide to change its state of organization. Such changes generally qualify for a simplified restructuring process. However, it’s important to follow certain steps.

An easier process

Tax-exempt organizations making certain changes to their structure used to be required to file a new exemption application — and create a new legal entity. But IRS Revenue Procedure 2018-15 changed the rules regarding nonprofit restructuring. Now, in many cases, nonprofits can simply report a restructuring on their Form 990. To be eligible for this simpler process, your restructuring must satisfy certain conditions:

First, your organization must be a U.S. corporation or an unincorporated association; be tax exempt as a 501(c) organization; and be in good standing in the jurisdiction where it was incorporated (or, in the case of an unincorporated association, where it was formed).

Second, your restructuring must involve one of the following:

1. Changing from an unincorporated association to a corporation,
2. Reincorporating a corporation under the laws of another state after dissolving in the original state,
3. Filing articles of domestication to transfer a corporation to a new state without dissolving in the original state, or
4. Merging a corporation with or into another corporation.

Your “surviving” organization is required to carry out the same exempt purpose that the original did. Its new articles of incorporation must continue to satisfy the IRS’s organizational test.

When the rules don’t apply

There are some additional limitations to using Form 990 to report a restructuring. For example, the new rules don’t apply if your surviving organization is a “disregarded entity,” limited liability company (LLC), partnership or foreign business entity.

Also, surviving organizations still have reporting obligations — for instance, to report the restructuring on any required Form 990 for the applicable tax year. And these rules apply only to federal income tax exemptions. Your state’s laws could require you to file a new exemption application.

Will you qualify?

Even though nonprofit restructuring can be straightforward, you should talk to your tax advisors before making a move. It’s possible your plans won’t qualify under Rev. Proc. 2018-15 and that you’ll need to apply for a new exemption and clear other hurdles. Contact us for guidance.  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, April 30th, 2024
Comments Off on Building a better nonprofit: Rules for restructuring

When the Inflation Reduction Act (IRA) became law in late 2022, you might have assumed that the tax breaks it contained wouldn’t affect your tax-exempt organization. That’s not the case. One IRA provision could help reduce construction project costs if you use energy-efficient materials and qualified labor. Another could provide direct cash payouts of certain tax credits. It’s time to take a second look at the IRA.

All tax-exempt entities included

After the Consolidated Appropriations Act of 2021 made the IRC Section 179D tax deduction for energy-efficient buildings permanent, commercial property and certain residential property owners could use the deduction by assigning it to qualified “designers.” Eligible owners included some government entities, but not the vast majority of nonprofits.

With the IRA’s passage, all tax-exempt entities became entitled to allocate their building tax deductions to qualified designers. You may already prioritize energy efficiency because it aligns with your mission and values — or simply to cut future utility expenses. Now, the Sec. 179D deduction may help you reduce up-front costs on construction projects that incorporate sustainable materials.

Qualified designers create technical specifications for the installation of energy-efficient commercial building property. Installation, repair or maintenance of such property isn’t sufficient to qualify for the deduction. Designers may include architects, engineers, contractors, environmental consultants and energy services providers.

A look at the process

To see how the allocation process works, let’s look at an example. Say that your nonprofit plans to build a 40,000 square foot, LEED-certified building and that you have $200,000 in tax deductions to allocate to qualified architects, engineers and other construction professionals. You may allocate the entire Sec. 179D deduction to a single designer or make proportional allocations to multiple designers. This can help you negotiate a better overall price for the project.

The exact deduction amount will be determined through a Sec. 179D study obtained by the designer. The study is performed by a qualified contractor or professional engineer who will make a site visit to your property to confirm that it has met or will meet energy savings requirements. You’ll also need to sign an allocation letter that includes the cost of the energy-efficient property (including labor); the date the property is placed in service; the amount of the Sec. 179D deduction allocated to the designer; and a declaration that the information presented is true and complete.

Note that you’re prohibited from seeking or accepting payments from a designer in exchange for providing an allocation letter. And you can’t require a designer to pay you a portion of the deduction’s value.

Cash refunds for tax credits

In addition to expanding availability of the Sec. 179D tax deduction, the IRA allows eligible tax-exempt organizations to receive certain tax credits as cash payments from the IRS. Previously, most tax credits were of no use to nonprofits.

The “direct pay” provision allows organizations to participate in clean energy benefits related to such credits as the Investment Tax Credit, Production Tax Credit, Advanced Manufacturing Production Credit, Commercial Clean Vehicle Credit and Alternative Fuel Vehicle Refueling Property Credit. The IRS makes credit payments after an eligible nonprofit files its return for the applicable year.

Seek advice

Contact us for a full list of federal tax credits that can potentially allow your nonprofit to receive cash payouts. And if you’re contemplating a building project, ask us about qualifying for Sec. 179D deductions.  You can reach us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, April 16th, 2024
Comments Off on Nonprofits: Take another look at Inflation Reduction Act tax breaks

When’s the last time you evaluated your not-for-profit’s social media strategy? Are you using the right platforms in the most effective way, given your mission, audience and staffing resources? Do you have controls to protect your nonprofit from reputation-damaging content?

These are important questions — and it’s critical you review them regularly. At the very least, you need a social media policy that sets some ground rules.

Annual reviews

As you know, the social media landscape changes quickly. The platform that’s hot today may be decidedly not hot tomorrow. So review your online presence at least once a year to help ensure you’re dedicating resources to the right spaces. Most nonprofits maintain a presence on Facebook and LinkedIn because that’s where likely donors tend to be. But if you’re an arts nonprofit or visually oriented, Instagram may be a better venue. And if your constituents are teenagers or young adults, you’re most likely to find them on TikTok.

In general, fresher, frequently updated accounts get more traffic and engagement. So try not to overextend your organization by posting on multiple platforms with only limited staff resources. Determine where you’ll get the most bang for your buck by surveying supporters and observing where peer nonprofits post.

Content monitoring

Social media is 24/7, and incidents can escalate quickly. So closely monitor your accounts, as well as conversations that refer to your nonprofit. A “social listening” tool that scans the web for your nonprofit’s name can be extremely helpful.

But the best defense against reputation-busting events is a formal social media policy. Your policy should set clear boundaries about the types of material that are and aren’t permissible on your nonprofit’s official accounts and those of staffers.

For example, it should prohibit employees, board members and volunteers from discussing nonpublic information about your organization on their personal accounts. With organizational accounts, limit access to passwords and regularly check posts and comments. Content from your feeds can easily go viral and create controversy. Make sure your staff knows when to engage with visitors, particularly difficult ones, and maintains a zero-tolerance policy for offensive comments.

Crisis plan

Mistakes, or even intentionally damaging posts, can occur despite comprehensive policies. Create a formal response plan so you’ll be able to weather such events. The plan should assign responsibilities and include contact information for multiple spokespersons, such as your executive director and board president. Identify specific triggers and a menu of potential responses, such as issuing a press release or bringing in a crisis management expert. Be sure to include IP staffers or consultants on your list.

Hopefully, a crisis won’t occur. But if it does, you’ll want to sit down and review your plan’s effectiveness after the situation has been resolved.

Select and protect

These days, no nonprofit can afford to ignore social media. Just make sure you’re applying your time and effort to the right platforms and protecting your accounts from those who would harm your organization. Be sure to contact us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, April 2nd, 2024
Comments Off on Making the most of your nonprofit’s social media accounts

Even if your not-for-profit organization rarely needs to reimburse staffers, board members or volunteers, reimbursement requests almost certainly will occasionally appear. At that point, will you know how to pay stakeholders back for expenses related to your nonprofit’s operations? If you have a formal reimbursement policy, you will. Plus, you’ll be able to direct individuals with reimbursement questions to your formal document and minimize the risk of disagreements.

2 categories

In the eyes of the IRS, expense reimbursement plans generally fall into two main categories:

1. Accountable plans. Reimbursements under these plans generally aren’t taxable income for the employee, board member or volunteer. To secure this favorable tax treatment, accountable plans must satisfy three requirements: 1) Expenses must have a connection to your organization’s purpose; 2) claimants must adequately substantiate expenses within 60 days after they were paid or incurred; and 3) claimants must return any excess reimbursement or allowance within 120 days after expenses were paid or incurred.

Arrangements where you advance money to an employee or volunteer meet the third requirement only if the advance is reasonably calculated not to exceed the amount of anticipated expenses. You must make the advance within 30 days of the time the recipient pays or incurs the expense.

2. Non-accountable plans. These don’t fulfill the above requirements. Reimbursements made under non-accountable plans are treated as taxable wages.

Policy items

Your reimbursement policy should make it clear which types of expenses are reimbursable and which aren’t. Be sure to include any restrictions. For example, you might set a limit on the nightly cost for lodging or exclude alcoholic beverages from reimbursable meals.

Also be sure to require substantiation of travel, mileage and other reimbursable expenses within 60 days. The documentation should include items such as a statement of expenses, receipts (showing the date, vendor, and items or services purchased), and account book or calendar. Note that the IRS does allow some limited exceptions to its documentation requirements. Specifically, no receipts are necessary for:

• A per diem allowance for out-of-town travel,
• Non-lodging expenses less than $75, or
• Transportation expenses for which a receipt isn’t readily available.

Your policy should require the timely (within 120 days) return of any amounts you pay that are more than the substantiated expenses.

Standard rate vs. actual costs

Finally, address mileage reimbursement, including the method you’ll use. You can reimburse employees for vehicle use at the federal standard mileage rate of 67 cents per mile for 2024, and volunteers at the charity rate of 14 cents per mile. Unlike employees, however, volunteers can be reimbursed for commuting mileage.

Alternatively, you can reimburse employees and volunteers for the actual costs of using their vehicles for your nonprofit’s purposes. For employees, you might reimburse gas, lease payments or depreciation, repairs, insurance, and registration fees. For volunteers, the only allowable actual expenses are gas and oil.

What makes sense

You don’t need to craft a reimbursement policy on your own. We can help ensure you include the elements that make sense given your nonprofit’s size, mission and activities and update it as your organization grows and evolves. Be sure to contact us at Online Stewardship or our parent company, Patrick & Raines CPAs. You may reach out to Lynn by calling (904) 396-5400 or email her at [email protected] or [email protected].

© 2024

Filed under: General by OSA&C Tuesday, March 19th, 2024
Comments Off on Plan now to reimburse staffers, board members and volunteers