Ways to Reduce Income Taxes

Tax time is here and Floyd Green CPA wants to help you with our tax services and tax tips.  We offer tax preparation services for individuals, LLCs, S Corps and 501c3 charitable organizations.  

501c3 Organizations Need People To Grow

All 501c3 and nonprofit organizations need people to ensure that the organization grows and thrives.  Large nonprofits which are successful have an army of people running the organization’s programs and activities as well as handling the administrative functions of the organization.

We, at Floyd Green CPA, group the people who work and serve nonprofit organization into 3 main groups:

-        Volunteers

-        Employees

-        Contractors

All three groups are valuable to nonprofits as each group brings a set of skills, expertise and enthusiasm.

Volunteers.  Many small 501c3 organizations operate exclusively by using volunteers.  Volunteers are unpaid individuals who perform duties and services for the organization.  Some volunteer jobs may involve lower skill responsibilities – such as passing out pamphlets at a function or greeting visitors at an organization function. 

Read more: 501c3 Organizations Need People To Grow

Electing Board Members and Officers (Nonprofit)

Each organization consists of governing body that is responsible for the management of the organization and for overseeing the activities of the organization.

 The Board of “members” or “Directors/Trustees” are elected, according to the type or the organization:

1. If the organization has members: the Directors are nominated and elected by the organization’s members. They represent the community of members and manage the organization’s activities, accordingly;
2. If the organization doesn’t have members: the Directors are the individuals who stand in front of the organization, either when the organization is setting-up or later on, once it has been operating for a couple of years.  If new Directors need to be appointed, the current Board of Directors elects the new Directors, as they have the voting control.

Read more: Electing Board Members and Officers (Nonprofit)

Nonprofit Church or Ministry

Ministries and churches are similar and often get confused as the same thing. They both are religious entities and are working to spread the word of a higher power. However, when filing for the 501c3 status there are a few main differences that matter to the IRS.

Ministry is defined as the service, functions, or profession of the body or class of people authorized to conduct religious worship. Usually, ministries are put in place to help someone in the name of a deity. For example, a Christian ministry would hand out food to the homeless in the name of Jesus. When filing for the 501c3 nonprofit status as a ministry, most are able to file the 1023-EZ form. If a ministry is doing more extensive work (like housing or disaster relief) and know they will go over $50,000 a year in revenue for the initial years, they must file the 1023 standard form. Each of the forms have different fees.

Read more: Nonprofit Church or Ministry?

501c3 Nonprofit Organizations for Veterans

Nonprofit veterans’ organizations must be operated exclusively to promote the social welfare of the community, to assist disabled and needy war veterans and their dependents, to provide entertainment or care to hospitalized veterans, to carry on programs to perpetuate the memory of veterans, to conduct programs for religious, charitable, scientific, literary, or educational purposes, to sponsor patriotic activities, to provide insurance benefits to members or their dependents, or to provide social and recreational activities to members.

Read more: 501c3 Nonprofit Organizations for Veterans

10 Easy Fundraising Ideas for Your 501c3

1. Yard Sale Fundraiser

People can donate their unwanted clothes, home goods, or collectibles to the organization. The 501c3 organization can then advertise around the community about the yard sale and sell the donate items to collect funds for the nonprofit organization.

2. Auctions

There are a few different types of auctions: Guess the Amount, Silent Auction, 50/50 Raffle, Penny Auction, Live Auction, and Online Auction. These can be easily done in the community by asking businesses to donate their goods or services to the charitable organization for the type of auction.

3. T-Shirt Fundraising

The nonprofit organization can get t-shirts made and sell them for donations. Not only does this help raise funds, but it also will spread the organization’s message whenever people wear them out.

4. Walkathons/Marathons

This is usually best during nicer weather months. The 501c3 organization can host a Walkathon/Marathon for the community. There can be an entry fee for all participants, as well as the participants could have the opportunity to get sponsors who donate a certain amount for each mile walked/ran.

Read more: 10 Easy Fundraising Ideas for Your 501c3