The Corporate Transparency Act (CTA) and Its Impact on Nonprofits in 2024

The Corporate Transparency Act (CTA), which came into effect on January 1, 2024, represents a significant shift in the regulatory landscape for U.S. businesses, including any non-exempt nonprofit organizations such as churches and charitable organizations. The implementation of the Corporate Transparency Act marks a pivotal moment in the fight against financial crimes, signaling a concerted effort to strengthen accountability and integrity within the business and nonprofit sectors.  This legislation aims to enhance financial transparency and combat illicit activities by requiring certain entities to report beneficial ownership information to the Financial Crimes Enforcement Network (FinCEN). By mandating the disclosure of beneficial ownership details, the CTA seeks to create a more transparent environment that deters illicit activities and promotes a culture of compliance across diverse entities operating within the United States. What Nonprofits Need to Know Exemptions for Nonprofits If your nonprofit has applied for 501(c) status but has not yet received it, you could potentially be subject to reporting requirements under the Corporate Transparency Act (CTA). Nonprofits with an active 501(c) status, political organizations under Section 527(e)(1), or charitable or split-interest trusts are exempt from the CTA's reporting requirements. This broad exemption covers a wide range of nonprofit organizations, including most charities, schools, religious organizations, private foundations, social welfare organizations, labor organizations, trade associations, chambers of commerce, and social clubs. It's important to note that the exemption applies without regard to whether the organization has filed an application for recognition of tax-exempt status pursuant to IRC 508(a) Implications for Noncompliant Nonprofits Nonprofits that do not meet the exemption criteria must comply with the CTA's reporting requirements.  Examples of Noncompliant Nonprofits Defective Drafting: Nonprofit organizations with defective drafting of their Articles of…

Continue ReadingThe Corporate Transparency Act (CTA) and Its Impact on Nonprofits in 2024

Navigating Transparency: Unveiling the Essentials of a Comprehensive Church Financial Report

A church's comprehensive financial report, carefully prepared by treasurers, sheds light on its financial health through key components like income statements, balance sheets, and budget comparisons. Supported by accurate accounting and bookkeeping, this report fosters transparency, trust, and informed decision-making, marking a path toward responsible stewardship and financial stability.

Continue ReadingNavigating Transparency: Unveiling the Essentials of a Comprehensive Church Financial Report

Do you know the nonprofit filing requirements this tax season? 

Tax season is here. Is your nonprofit ready? Let’s go over the basics of nonprofit filing so you can confidently file returns in 2023!

Continue ReadingDo you know the nonprofit filing requirements this tax season? 

Giving Tuesday Is November 29. Here’s How Your Church Can Prepare

With Giving Tuesday just around the corner, there are several ways your church can prepare for full participation but be aware of donor impact on your overall accounting procedures. In the digital age, tracking donors and donations has become more complex, depending on the way your church accounting is set up.

Continue ReadingGiving Tuesday Is November 29. Here’s How Your Church Can Prepare