The Top 50 Mistakes in Nonprofit Taxation and Governance Issues and How to Fix Them - DIGITAL pdf download

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The Top 50 Mistakes in Nonprofit Taxation and Governance Issues and How to Fix Them


The nonprofit sector is growing by leaps and bounds.  There are now more than 2 million organizations in the United States.  However nearly four hundred thousand organizations lost their tax exempt status in 2011 through 2014.  Congress and the IRS are now scrutinizing nonprofits in much greater depth.  New applications for tax-exempt status are being analyzed more thoroughly, and Form 990 has been revised to provide more in-depth information that will enable both the IRS and donors to evaluate organizations.  This unique course will enable CPA's to serve their existing clients in an improved manner as well as open markets to this growing client base.  The class will include recent legislative changes and court cases affecting the nonprofit sector and revisions to Form 990.  Cases studies will extensively cover internal control, budgeting, conflicts of interest and other similar areas. (Qualifies for Yellow Book CPE)


  • Identify the major errors in forming a new nonprofit organization, which could result in embarrassment and potential liability to its directors 
  • How to assist clients with planning strategies to grow and sustain their organizations in the future 
  • Preparing the challenging Form 990 and avoiding mistakes with the IRS and state tax authorities and put the best image out relating to the organizations 


Nonprofit Formation and Governance

  • Mistakes in preparation of the IRS application for tax-exempt status cause entities to be denied tax exempt/public charity status because of a lack of understanding as to IRS requirements 
  • Many organizations fail because of poor planning in structuring a new nonprofit and creating a strong board of directors 
  • Not handling conflicts of interest properly may cause embarrassment and potential personal liability for the directors 
  • Fundraising activities may be illegal or unethical under federal or state law 
  • Mistakes in establishing internal control procedures in a nonprofit organization can cause the risk of misappropriation and embezzlement 
  • Did the organization need to be created when something simpler, like a donor advised fund or partnering with an existing organization, could have substituted Was time and money wasted 
  • Is the organization realistic in obtaining funding in an extremely competitive philanthropic environment Nonprofits fail even with admirable intentions

Nonprofit Taxation:

  • Does the client have to file a tax return under the new guidelines 
  • The Form 990 is a public document. Are mistakes made in communicating the accomplishments of the organization A 1040 or 1120 is not a marketing tool - the Form 990 is the best tool for growth of an organization. 
  • Unrelated Business Income Tax (UBIT) - Avoiding mistakes in treatment of certain types of revenue which could result in tax consequence or possible termination of tax exempt status 
  • Reconciling book income to the tax return; i.e. in-kind donations may provide a clearer picture of the operation of the entity 
  • Eliminating mistakes in classifying expenses as program services, administration, or fundraising to comply with IRS guidelines and charity watchdogs like the BBB will project a better image of the organization 
  • Do you realize that it is the responsibility of a charity to communicate the quid pro quo value of things that are provided in return for money given to a charity 
  • Tax shelters and nonprofits - Certain joint ventures are OK, but abusive tax shelters are not - avoiding the mistakes! 
  • Avoiding penalties asserted by the IRS and states - what is contestable 
  • Donations of tangible property - determining FMV, basis, and utilizing IRC 170(e)(3) for donations of inventory and depreciable assets.  Mistakes are made in soliciting donations from businesses, resulting in missed contributions to the charity and smaller dollar deductions by the contributor 

Designed For:
Tax Practitioners and nonprofit leadership and staff who wish to avoid the expensive tax and planning errors often made by nonprofits and their benefactors 

Prerequisites:  Experience working with nonprofit organizations in the areas of taxation and accounting

Level:  Basic
NASBA & IRS Field(s) of Study:  Taxes

Our inventory includes videos, audio, books, and text based courses. We have recently added transcripts of the videos that will be completed by July, 2016. Please contact us for further information.


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