Internal Controls for Nonprofits – CPE

The Maryland Association of CPA’s is holding a conference on April 27^th for the discussion of internal controls as related to not-for-profits.  This 8 CPE hour course will focus on the changes in the auditing industry and how they affect non-profits.  It will cover a range of topics from comparing the types of internal controls through the use of SAS 70’s by outside firms.  Please visit this link to find out more about the conference and how to register.  http://www.macpa.org/Public/Catalog/CourseDetails.aspx?courseID=10171052

IRS Notifies Employers of Health Care Tax Credit

April 19, 2010 (PLANSPONSOR.com) – The Internal Revenue Service has begun mailing postcards to more than four million small businesses and tax-exempt organizations to make them aware of the benefits of the recently enacted small business health care tax credit.

An IRS news release explained that a provision included in the Patient Protection and Affordable Care Act provides a tax credit to small employers that pay at least half the cost of single coverage for their employees in 2010. For tax years 2010 to 2013, the maximum credit is 35% of premiums paid by eligible small business employers and 25% of premiums paid by eligible employers that are tax-exempt organizations.   

The maximum credit goes to smaller employers –– those with 10 or fewer full-time equivalent (FTE) employees –– paying annual average wages of $25,000 or less. Because the eligibility rules are based in part on the number of FTEs, not the number of employees, businesses that use part-time help may qualify even if they employ more than 25 individuals.   

The credit is completely phased out for employers that have 25 FTEs or more or that pay average wages of $50,000 per year or more.   

Eligible small businesses can claim the credit as part of the general business credit starting with the 2010 income tax return they file in 2011. For tax-exempt organizations, the IRS will provide further information on how to claim the credit, the news release said.  

More information about the credit is here.

The Audit Committee

Most nonprofit organizations have an audit committee but some are still trying to figure out how best to use this committee.   The American Institute of Certified Public Accountants (AICPA) has created an audit committee toolkit for nonprofit organizations.  Permission is granted to download the tools and tailor or customize them for the organizations use.   A sample of the tools include; “Fraud and the audit committee”’ “Whistleblowers”, “Evaluating independent auditors”, and “Discussions with independent auditors”.  To review all the tools available go to AICPA.

Nonprofits benefit from the Small Business Health Care Tax Credit

The health care bill signed by President Obama last week, the Patient Protection and Affordable Care Act, provides a credit that can be used by small tax exempt organizations to help provide or keep health insurance for their employees.  To qualify an employer must cover at least half of the cost of health care coverage, the company must have less than the equivalent of 25 full-time workers, and pay average annual wages of less than $50,000.  The IRS will be providing information in the future on how to claim the credit – so stay tuned!

Link to IR-2010-38 http://www.irs.gov/newsroom/article/0,,id=220848,00.html