Common problems to avoid in employment law – post by Katie Morell at AmEx Open Forum:
Extremely short version:
I didn’t post on this earlier. Then came across this great article that said what I had in mind.
Core Inflation Rises – Interest Rates May Follow, by James C. Cooper. Couple of good graphs in the article along with the great discussion.
In May 2011, the core inflation rate was 0.3% while the posted CPI was 0.2%. Read the rest of this entry »
Posted a discussion on IFRS at my other blog, Attestation Update. Post is: Arguments for adopting IFRS are weak, arguments against have validity. Therefore we obviously should adopt IFRS.
Perhaps you can tell from the title, I’m not persuaded IFRS is a good idea. If you are interested in such things, check it out.
I have several posts about the mandatory report of overseas bank accounts. This issue can easily involve NPOs that have overseas operations. The form used to report and the whole process is referred to as FBAR. Actual name is Report of Foreign Bank and Financial Accounts.
Extension of deadline
The IRS has extended a deadline for filing the FBAR reports for 2009 and earlier. The new deadline is November 1, 2011.
This means “persons” could catch up on the filing of all those reports that had never been filed. Persons include NPOs with bank accounts used in overseas projects.
By the way, the extension does not apply to the 12-31-10 reports which must be filed by 6-30-11.
Verne Hargrave, at Faith-Based Accounting, has a one word answer. See his post: Question #4 – “should our childcare workers be treated as employees or independent contractors.” Straight to the point.
Previously discussed the FBAR report and additional background on how easy it is for an NPO with overseas activity to generate a requirement to file the report. Will get back to the extended deadline, but need to look at the downside of not filing.
This is where things get ugly. The FBAR report says the penalty for a person who fails to properly file is a civil penalty up to $10,000. This applies to organizations also. If there is reasonable cause, then no penalty will be imposed.
It gets worse.
The IRS announced an increased mileage rate for the last half of 2011 due to high fuel costs.
Starting 7-1-11, the optional rate for business use of vehicles is 55.5 cents per mile. For medical and moving the optional rate is 23.5 cents per mile.
California nonprofit organizations are required to file a Statement of Information, form SOI-100, with the Secretary of State every two years.
This series of posts is discussion the FBAR in general and an extension of the deadline to file the reports from 2009 and earlier. It is important to note the deadline for filing the 2010 reports is still June 30, 2011. Not much time left for those reports.
Previously discussed the filing requirements for the FBAR report and how that would fit into the operations of an NPO with overseas activities.
How does this get messy for a mission organization?
How else could the usual functioning of a foreign mission organization create filing requirements? Let’s say you have missionaries located in the field who have a local bank account. While they likely are drawing a very modest salary, the situation could easily develop where staff could cross that $10,000 cutoff in their account and have to file a report. Merely send someone funds to buy a vehicle, for example. Your program manager and assistant manager sign on the account used for the office expenses, so they each have a personal filing requirement.
Federal law requires filing a report with the Treasury Department when you have foreign bank accounts with balances over a certain amount. This law applies to NPOs.
Deadline for filing all of the past reports has been extended by the IRS.
How can this be an issue in the nonprofit community? If you have field programs and a local bank account to pay bills then this requirement could kick in. It is my personal perception there may be some mission organizations that have a filing requirement but are not doing what they need to do.
I will give a little background, explain why this is an issue for the nonprofit community, and then describe the extended deadline.
ECFA has analyzed the giving of their members who renewed membership in the last six months. Looking at members with year-ends between April and September 2010 and comparing that to those member’s revenue from three years earlier produced some encouraging information.
This would include organizations who have been members at least three years, so there’s data for comparison. Keep in mind this would be for NPOs whose fiscal year-end dates were in the middle part of 2010.
That said, here is the summary:
As discussed here, not filing any returns with the IRS for three years now results in automatic revocation of exempt status. This is a very bad place to be. Without exempt status an organization cannot accept deductible contributions, would have to file an 1120 income tax form, and would not be able to do other things that only exempt organizations can do.
If you get in this situation there is no appeal or reversal. Your organization will have to apply for exempt status from scratch. The whole 1023 thing.
The IRS announced some special rules, called transition relief, for very small organizations.
We all need to gain balance in our lives. Get some ideas on how in Dr. Richard Swenson’s book In Search of Balance. (full disclosure – I am not compensated for the Amazon link.)
From my Amazon review:
More and more of everything faster and faster is the phrase Dr. Swenson uses to describe life today.
Eight words that describe all aspects of our world. More and more - a rapidly increasing volume and quality and intensity. Of everything – all aspects of our life, such as technology, money, every area of knowledge, experiences, entertainment, great books we should read, quality of consumer goods. Faster and faster – the rate of change is accelerating.
Nobody reading this review needs to be told your life is out of balance. With a moment of reflection we all realize that. That we don’t have a spare moment to reflect is the crux of the problem.
Instead of us just trying harder, or working smarter, or just ‘getting it together’, he provides a series of prescriptions on how to gain equilibrium in life.
I am enjoying the idea of teaching accounting or economics or other complex stuff through some creative method. Have had several posts on the topic. So intrigued by the idea that I’ve started producing cartoons. (See my other blog, once upon internal control.)
How’s this for an idea? Writing a full-length murder mystery novel with the goal of teaching auditing, taxes, IT and forensic accounting. That has been the approach of Prof. Larry Crumbley. In his spare time he has written 13 educational novels. Started back in 1988.
I would like to provide a complementary copy of my book Once Upon Internal Control to pastors of local churches. This short fable is the basis for the cartoons you see on my other blog.
Update: This book is now available on Amazon for $0.99USD.
Offer good for delivery in U.S. only, effective December 5, 2011. Free offer expired on December 31, 2011.