Remind Donors of the CARES Act Tax Deductions for Charitable Giving Giving season is upon us, and nonprofits and social impact organizations have been running lean and nimble amid the Coronavirus pandemic. While annual in-person events have switched to virtual and the outcome of giving season seems unknown and frightening, there is always light at the end of the tunnel. Here is our glass half-full perspective on increasing giving this year: Most donors plan to maintain, or even increase, the amount they donate to charity this year. According to Fidelity Charitable, 25% of donors plan to increase their donations and 54% of donors plan to maintain their giving levels. Younger generations are also upping their giving with 46% of Millennials say they will give more in response to the pandemic. The Coronavirus Aid, Relief and Economic Security (CARES) Act, which includes provisions that are designed to foster charitable giving activities and advance nonprofits’ missions, could incentivize people to give more. Take the time to inform donors about the CARES Act Tax deduction and see if it boosts your giving season results! Here are the deets: Electing individuals who itemize deductions on their personal income tax return (including couples filing a joint return) can deduct qualified cash charitable donations up to 100% of their adjusted gross income (AGI) for tax year 2020.. Under previous law, such contribution deductions were limited to 60% of AGI. That means itemizers can fully deduct their charitable cash contributions this year. Winning! Hopefully this will be a boon to the nonprofit sector and organizations will see a boost in charitable giving. How much do individuals need to give in order to benefit if they want to itemize? For folks who don’t itemize, there’s also a new incentive to give in 2020. If you take the standard deduction on your 2020 tax return (the one that you'll file in 2021), you can claim a brand new "above-the-line" deduction of up to $300 for cash donations to charity.
Be aware, donations to donor advised funds and certain other types of organizations that support charities are not deductible. Also be aware that this deduction is only for those who do NOT itemize (no double dipping, folks). Need help with your tax planning? Have questions on how to frame this for your nonprofit’s donors? Our friendly team at Blue Fox is here to help! Give us a call at (321) 233-3311 or email. We’ll get you sorted!
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The famous art director Paul Rand said, “Design is the silent ambassador of your brand.” In my opinion, no truer words could describe the art of branding. A logo is a window into the values, traits and personality of a company. Get it right and your logo (a.k.a. your silent ambassador) can be the most effective sales person on your team. As Director of Marketing for Blue Fox, I think our founder and graphic designer struck blue gold when they brought alive, Penny the Blue Fox. Just like our team she is clever, agile, intuitive, reliable, witty, and the list goes on. So, what’s the story behind the Blue Fox brand? Here’s the first part: An Accounting Firm’s Marketing Love Story, told by our Founder & CEO, Chantal Sheehan. (She won’t admit it but she’s a marketing guru too.) Her article is a must read! She says, “The branding process forced me to be brutally honest with myself about what I want to be known for and reflect, what good I want to do in the world, and what kind of company I want to lead.” The decision was made, Chantal named the company Blue Fox. Next step: logo design. Meet Juhli (pronounced July) Greene, owner of Greene Image. Chantal met Juhli at a Chamber of Commerce networking event and became fast friends. They worked together to design the Blue Fox brand and the rest is history. That was 3 years ago and in honor of the anniversary, we thought it would be fun to interview Juhli and learn more about her creative process, her company and working with Blue Fox.
Chelsea: Tell me a little about Greene Image. What type of clients do you serve and what services do you provide? Juhli: I have 20 years experience in the graphic design industry with a focus on small businesses, hotels and country clubs in the Tampa Bay area. I pride myself on friendly customer service and attention to detail. My design services include: print marketing materials, digital graphics, logo design, brand development, social media graphics and even animated graphics. I especially like helping women owned business with their visual needs and enjoy offering creative ideas to help their business grow. Chelsea: Do you remember your first conversation with Chantal about her brand creation and logo design needs? How did it go? Juhli: I remember being excited for her. I love when my friends follow their dream of starting a company, because that’s what I did. It empowers me. As for the logo, I was focused on getting it fine-tuned because I really wanted to do right by Chantal. She's an amazing person that I really respect. Chelsea: In your opinion, what is the most important element of logo design? What does your process for logo development look like? Juhli: It’s so important for the client to have a clear picture of what their business is all about. Then, it’s all about communication. The more information I can glean from my client, the better able I am to design a logo to represent their ideals. Sometimes they don't know what they want so the discovery process may take longer. I try to guide them and ask them questions to help them realize the brand logo of their dreams. Chelsea: (Wink, wink) Is the Blue Fox logo your favorite you ever designed? Juhli: Yes! It really is. The Blue Fox logo is strong but fun and smart but personable just like Chantal and the Blue Fox brand. Plus it’s adorable and I love how we are able to use Penny in so many fun ways. We did spend some extra time getting Penny just right and I think it paid off in the end. Chelsea: What are your goals for Greene Image in the future? Juhli: This year, with the current situation, I am simply thankful for all my current clients. I am especially proud of being on the Blue Fox team as I feel like I am a part of something bigger that is making a positive impact in the world. I look forward to seeing Blue Fox grow and being a part of the fun. On the Flip Side: Here’s what Blue Fox CEO, Chantal said about working with Juhli and Greene Image, "I'm not sure I can truly express how great it was to work with Juhli on the birth of the Blue Fox brand. She asked me all the right questions, and she seemed to "get it" quickly. Juhli was able to create and edit really fast when I look back on it, too. She also consistently met our deadlines. This was really important to me at the time because most other graphic designers I'd worked with drop the ball on a regular basis and chronically deliver work late. That was never the case with Juhli. She's a true professional and such an asset to our team!" Check out the bodacious design work by Juhli and Greene Image on her website, Facebook, LinkedIn and Instagram. Get in touch with Juhli at juhli@greeneimage.com and (813) 298-7332. Are you self-employed; earning 1099 income?
Is your personal business generating 30k+ per year? Ever wondered about the tax benefits of incorporating? Our team at Blue Fox specializes in tax preparation for independent contractors and sole proprietors. Consultants, designers, photographers, freelancers – that’s you! We especially love to serve those who work in the social impact sector. If you’re thinking about incorporating, let us help you analyze the numbers. Let’s see if it’s worth it. Schedule a free consultation: https://calendly.com/chat-with-chantal. On: Doing the Best we Can in the MomentLast week I had the privilege to speak to nonprofiteers all over the country at Nonprofit Hub's Cause Camp 2020. After I acknowledged that 2020 is basically a dumpster fire, I took an informal poll of the audience to see how everyone was feeling. Interestingly, Cause Campers generally reported a mix of optimism and anxiety. I was shocked because in my head those two sentiments don't usually go together. But I shouldn't have been because, you know. Dumpster fire.
In the spirit of optimism, here are a few thoughts now that 2021 is around the corner:
We are all doing the best we can in this moment. And that's all we can do, isn't it? Good for us. Good for you. Keep going. Be grateful for today. We are the ones we've been waiting for. And we're with you. Chantal Blue Fox Specializes in Tax Services for Consultants and Independent ContractorsAre you self-employed; earning 1099 income?
Is your personal business generating more than $30k per year? Thinking about incorporating? [Our CEO has a video message for you!] It sounds like it’s time to analyze your tax position. Let’s compare the costs of incorporating against the tax savings you’d realize as an S-corp. Let’s figure out if you’re missing any key write offs that can lower your taxable income. Many of our individual tax clients have a side hustle. Some are just starting out and claim their earnings as 1099 income on a Schedule C. Nothing fancy, but these sole proprietors or single-member LLCs have saved thousands of dollars and kept their audit risk low by asking us for help at tax time. Another group of our clients have taken their side hustle to a whole new tax advantaged level by becoming S-corporations. We love using legal strategery (yes, we know that’s not a word) to proactively help people maximize their tax refunds. Here are some examples. EXAMPLE 1: Let’s Save $2,000 One of our clients is an adorable family with young children. This family has been our client for 5 years, from their first year of marriage through the birth of their beautiful kiddos, we sit together every fall and spring to talk about tax-saving strategies. The woman of the household is a part-time freelance marketing consultant, while her husband has both W-2 and 1099 income as a salesperson. She is earning between $28-32k annually and claiming that 1099 income on a Schedule C. Every fall, we have a free tax planning meeting and crunch some numbers for their family. Taking their entire financial and tax picture into consideration we determined a few weeks ago that they could decrease their tax liability by $2,000 if she incorporated as an S-corp. Who doesn’t want to keep $2,000 more of their hard-earned cash?? EXAMPLE 2: Let’s Save $8,000 A few years back, another young couple (with equally adorable kiddos, btw!) came to us for a fall tax planning meeting with surprising news: his side hustle had made nearly $60k that year and he’d also changed jobs. Both of these factors meant a significant and unexpected jump in income. We crunched the numbers and their tax bill looked to be around $6,000. We talked about their options in depth, because no one wants to owe on April 15th, right?? We suggested that, since his spouse did plenty of unpaid work for his side business, we actually put her on payroll. “Is that even possible?” he asked. Yes. 100%. This is a great tax-saving strategy for sole proprietors. Pay your spouse W-2 wages, and the wages and payroll taxes then become an EXPENSE to the business, lowering your Schedule C net income. There are costs associated with this strategy, like payroll processing fees and W-2 filings, but the tax savings eclipsed those expenses for this family. When we saw the couple was intrigued, we doubled down. We suggested that along with payroll, since they didn’t need the cash, the ultimate tax avoidance strategy is to open a business retirement account and defer as much (or all) of the spouse’s wages into the plan up to the annual limit. This allows for federal tax deferral on the W-2 income for the spouse. They were on the fence, until we shared that this second step would take their tax bill from $6,000 to a refund of $2,000 – that’s $8,000 saved in just one conversation! EXAMPLE 3: Save Nothing “Pay the bill and make peace with what you owe – after all, you did have a good year!” No, this isn’t a joke. Yes, we do say this sometimes. Why? Because A) it’s true, and B) adulting is hard. We’ll give you all your options, but at the end of the day if it’s too much to worry about with your day job, and COVID-19, and your kids running around, and your side business, we GET it. We’re here to give you good advice, that’s all. It’s up to you to take it. We won’t pressure you no matter what you decide. Do these situations ring true for you? Are you doing pretty well at a side hustle but feel like Uncle Sam is taking too much of your cheese? Want to talk to an experienced human about your unique situation? There is no one-size-fits-all solution in the tax code. Our team at Blue Fox understands that. We work with you based on your particular challenges and opportunities. Our goal is to do everything we can to reduce your tax liability and help you keep more of the money you work so hard to earn. Consultants, designers, photographers, freelancers – call us up! We especially love to serve those who work in the social impact sector. It warms our heart! If you’re thinking about incorporating, let us help you analyze the numbers. Let’s see if it’s worth it. Schedule a free consultation: https://calendly.com/chat-with-chantal. If you’re looking for a human person to talk to about tax planning, that’s us. Let’s connect at (321) 233-3311 and hello@yourbluefox.com. Nonprofits, When to Apply for PPP Loan ForgivenessSo, you received PPP funds.
What do you do now? How do you make sure your loan is forgiven? If you're asking these questions, you're not alone! What we know:
As always, our team is happy to answer questions and help your organization navigate current financial challenges. Give us a call at (321) 233-3311 or email hello@yourbluefox.com. Raise your hand if you love being audited. Anyone? Anyone? We didn’t think so. At most companies, audit time causes anxiety and panic. And, the pressure doesn’t stop there. As a financial services and advisory firm, we’re under the microscope too. For many nonprofit organizations an audit is an annual occurrence (often mandated in the bylaws or by state law). From a fundraising perspective, a clean audit can demonstrate sound financial stewardship and pave the way for increased donor trust and giving. That’s why our team at Blue Fox views a client audit as a management and marketing opportunity, as well as an important financial management exercise. Using the right tools and technology, we’ve reduced the tedious audit process from an average 10 hours down to just 2. That’s an entire workday saved – you’re welcome! How did we do it? One app: Bill.com. We’re such big fans of Bill.com’s audit effectiveness that Bill.com asked our CEO, Chantal Sheehan to write about it on their blog. In the full article, How to Help Your Clients Get a Clean Audit, she highlights 3 key features at Bill.com that help our clients get clean, fairly painless audits each year: (1) Digitized, paperless records (2) Enforcement of internal controls (3) Audit trail feature The full article gives specific details and examples. It’s a must read! Is your organization looking for nonprofit audit preparation services? Give us a call at (321) 233-3311 or request a meeting. We’ll get you sorted! Then you can focus on what really matters: your mission and serving your community. Related Articles 5 Tips to Get You A Clean Audit Every Year Nonprofits - It's Time to Automate Your Back Office 10 Reasons to Outsource Your Nonprofit Accounting Fundraisers certainly have their work cut out for them this year. Coronavirus. Racism. Unemployment. Riots. Business closures. Natural disasters. A contentious election year. All of these make for a super challenging fundraising environment. So, what’s a fundraising organization to do?
Chances are, you’re already making lemons out of lemonade. We applaud all of you nonprofiteers for a quick pivot to digital fundraising, virtual events, and redirecting your focus on personal donor communication strategies. Strong relationships are more important than ever. And, our team at Blue Fox would like to offer: “What if those relationships are paired with strategic financial knowledge? How much more effective could your fundraising team be?” Our CEO, Chantal Sheehan recently wrote a guest feature article for Bloomerang addressing this exact question: 4 Finance Secrets to Help You Raise More Money. (1) Know Your Burn Rate (2) Be Transparent and Fluent in Financial Data (3) Demonstrate Financial Resilience (4) Understand How to Frame Overhead as Programmatic Support The full article gives specific details and examples. It’s a must read! If your team could use guidance implementing these suggestions, our friendly team at Blue Fox is here to help! Give us a call at (321) 233-3311 or email. We’ll get you sorted! Then you can focus on what really matters: your mission and serving your community. Related Articles 6 Step Guide to Build Donor Trust Our Favorite Resources for Nonprofit Fundraisers Kindness Leads to More Profit and Productivity [PREFACE: This blog article was started pre-coronavirus pandemic. That’s why the first sentence doesn’t start, “During these difficult times,” and the context doesn’t talk about COVID-19 throughout. However, it’s important to note that building a financially sustainable nonprofit is your best shot to keep services running during tough economic times such as these. So, let’s get to work.] In the nonprofit world, nirvana is achieved through financial sustainability. We’re talking about a level of sustainability that most organizations only dream about: fully funded operating reserves, available lines of credit, multiple revenue streams, and a full understanding of when the money flows in, how to leverage it, make it grow, and how it is best spent. Financial sustainability creates its own beautiful cycle. It breeds proactive leadership, strategic direction, and organization growth. Why? Because social impact leaders with a comprehensive understanding of their financial operations can confidently communicate, empower and build trust with their stakeholders. And, trust leads to increased financial support. [6 Step Guide to Build Donor Trust] This high-performing type of organization is 100% possible! We know because we’ve seen countless organizations transform, including many of our clients. So, where does a nonprofit start? Here’s a model of the 4-part system that our CEO, Chantal Sheehan uses to help nonprofits achieve financial sustainability. It’s a cycle. It’s a system. The flow creates continuous improvement and continuous analysis. Let’s break it down… StewardshipSimply put, stewardship is nurturing, supporting, and taking care of something. Its time spent thinking, planning, talking, and taking action to ensure long-term viability. Ask yourself. Does your team steward your financial operations as much as other organizational activities? Think about how much time your team spends each week on fundraising? How much time do you spend cultivating donors? How much of your time is spent chasing donations and grant money? 50% of your week? 70%? Maybe even 90%? Now, how much time do you spend analyzing how those hard-fought dollars are used? Do you have regular meetings with your team about finance? Do department or program heads talk about budget in real-time and regularly? In most cases, the time spent on financial management (stewardship) is not even close to the time spent raising the funds. It’s time to change that dynamic and take one huge leap closer to financial sustainability. “Sustainability starts with a commitment to apply the same principles and stewardship to finance as we apply to fundraising and donor relationships.” – Chantal Sheehan, Blue Fox CEO Technology The use of modern financial technology is a critical support mechanism for financial stewardship. Tech platforms have come a long way in the last decade. They are more cost-effective and affordable than ever, and it’s time for nonprofits to get on board. Using financial technology appropriately is no longer just a plus for nonprofits… it’s a must. FinTech or bust! [Our Favorite Back Office Technology Solutions] Some reasons why social impact organizations should adopt or seek out best of breed financial technology:
* Side note on “cloud-based”: Let’s get coffee if you think we’re talking about actual clouds here :) DataData. It’s not just a word for nerdy back-office folks crunching numbers. Data is a word used by proactive smart leaders. Data is what gives nonprofit executive directors, CEOs and board members the ability to make reasoned, educated decisions. Data is the pencil that draws the blueprints for strategic planning. If your last organizational decision was made by intuition, why not generate some data to check yourself and provide evidence? Data breeds buy-in too. When it comes to collecting data, our CEO always says, “Garbage in, garbage out.” If your FinTech is working for you the way it should be, avoiding bad data should be straightforward. But here are some operational decisions for your team to consider to ensure your data is squeaky clean:
InsightsNow that your data gleams, it’s time to use it to generate insights. Data tells you what happened. Insights tell you why something happen, why something failed to happen or what might happen next. Insights result from analysis and discussion. One of the best ways to analyze and discuss data is to make it visual whenever possible. Here are some tools that make financial data visual and encourage your team to generate insights to aid in organizational decision making:
Once you’ve taken your data from snooze-fest to wow-fest, you’ll notice a fairly immediate shift in how your team discusses it. Insights will begin to reveal themselves, giving you the capacity to make informed decisions and strategic moves as needed. Stewardship (Yes, Again) It’s time to close this loop of continuous improvement and analysis. Let’s talk about, plan for and become proactive (a.k.a. steward) about your financial situation to put your organization in a more sustainable position. Data and the insights they reveal show you what financial risks and opportunities exist. Now, relate those to your external and internal environments. Determine what changes you can make now so that your organization is stronger and better able to mitigate risks. Think about how these new insights should inform changes to your current fundraising initiatives, revenue goals, operational plans, and program strategies. Then plan for a rainy day. Shore up any potential cash flow weak spots by acquiring a line of credit and creating an operating reserve (5 Key Elements Your Operating Reserves Policy Needs). Do this year after year, and you will watch your organization shift from reactive to proactive, and sustainability will follow. As always, if your team could use support implementing this system at your nonprofit, Blue Fox is her to help! Give us a call at (321) 233-3311 or email hello@yourbluefox. Feel free to learn more about our philosophy, clients, services and our team before you make that call. Now, let’s get to work! By: Blue Fox CEO, Chantal Sheehan and Marketing Guru, Chelsea Clementi How Do Your Financials Measure Up?Dust off those financial statements and put them to work! Our team at Blue Fox created this Magical Ratio Matrix to help your organization measure its financial health against industry standards. So, how do you measure up? What are the red flags for each ratio? Is your organization in a healthy, sustainable position? BUT FIRST! Before you start your calculations, make sure your financial data is current. Complete Step 1 on our Ultimate Financial Checklist. Check each box to ensure your data is squeaky clean. Remember: Accurate data = accurate insights = informed decision-making. LET’S CRUNCH THOSE NUMBERS How did it go? Are your ratios within the acceptable range? Did you get a red flag? If so, that’s okay. That’s important information to have. The question is: what are you going to do about it? Do you know what steps you can take to improve your nonprofit’s financial position? If you have any questions about your results, our friendly team at Blue Fox will happily help. Feel free to schedule time with our CEO to get some answers. Thank you for stopping by our blog!
Subscribe here for updates. ABOUT US Blue Fox offers monthly back office financial services (bookkeeping, HR, payroll, tax) and financial consulting specific to social impact organizations. Our team members have broad expertise in the social impact space, with backgrounds as nonprofit leaders, board members and volunteers. The entrepreneurial spirit runs deep on our team. This means we manage your back-office from the same perspective as you would. Meet some of our clients! |
Our BlogWelcome to the Blue Fox Blog! A fairly entertaining source of info and news related to our company, nonprofits, social sector trends, and, of course, accounting. Enjoy! Top ArticlesBack to Basics: How to Set Up Your Nonprofit Chart of Accounts
How "Small" Payroll Mistakes Cause Multi-Year S#!t Storms for Nonprofits Behind the Scenes, New Client Onboarding Call When to Hire a Tax Professional - 10 Factors to Consider 40+ Ideas to Light a Fundraising Fire Under Your Nonprofit Board Members Why Outsource Your Nonprofit Accounting to Blue Fox? Ask One of Our Newest Clients Client CASE STUDY: One of The Most Financially Sustainable Nonprofit Orgs We Know The Magical Nonprofit Financial Ratio Matrix 10 Reasons to Outsource Your Nonprofit Accounting How to Make Your Nonprofit Recession-Proof How to Engage Your Board of Directors in Financial Conversations QB Tip of the Month: How to Use Classes for Painless Grant Writing When to Hire an Accountant for Your Social Impact Org Are You Paying Too Much for Payroll? Company NewsBlue Fox Teams Up With Bloomerang to Develop Nonprofit Resources
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