Articles

Posted by: Karen Dunn

Crowdfunding has become a popular way to raise funds for particular causes, but donors and recipients should be aware of the tax requirements involved.

In crowdfunding, typically, a third party raises funds for a charity or cause through their internet platform and then turns the contributions over to the charity or beneficiary, less a fee. It is commonly used to raise funds to help individuals struck by tragedy or a broader charitable cause. For example, GofundMe features a campaign to donate to Ukraine relief efforts and another to help victims of the Sacramento mass shooting.

So, what does all this mean for crowdfunding donors and recipients?

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Posted by: Dan Wright in Cryptocurrency · NFTs.

Despite Non-fungible Tokens (NFTs) growing popularity, the Internal Revenue Service (IRS) has not yet published specific federal income tax guidance prescribing how NFT transactions should be taxed. Nevertheless, NFT transactions, like cryptocurrency transactions, are generally considered to be subject to federal (and often state) income taxation. This article is limited to federal income taxation. The next article in this series will address the state and local tax implications of NFT transactions.

Investors should expect that the sale of an NFT should be treated as the sale of a capital asset, and some NFTs could meet the definition of “collectibles.” When collectibles are sold or exchanged,

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Posted by: Pete Miller in SSPA Compliance.

For Microsoft suppliers handling sensitive and/or confidential information, compliance with the Supplier Security and Privacy Assurance (SSPA) program is a complicated and varied annual exercise. As we previously discussed in an article on the annual compliance cycle, one of the steps in the program is an audit – known as an independent assessment in the SSPA program guide.

This article will focus on that assessment and shed some light on the moving parts and ingredients that make a successful audit (i.e., an audit that is accepted by Microsoft in a timely manner). We will discuss each of the three distinct phases of the audit: pre-testing,

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If your organization has received federal grant assistance to fund an equipment purchase, the Uniform Guidance has requirements that must be followed in the use, management, and disposition of the funded equipment. The equipment management requirements of the Uniform Guidance are contained in Subpart D and specifically at 2 CFR Part 200.313. Though some of these requirements are intuitive, many are not, and they will require specific procedures to be put into place to comply.

Defining Equipment

To start, equipment is defined as “tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-federal entity for financial statement purposes or $5,000 (2 Code of Federal Regulations (CFR) Part 200.1).”

In addition,

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Current U.S. Department of Health and Human Services (HHS) regulations could impose an external audit requirement on commercial recipients of provider relief funds (PRF) under the CARES Act. If affected, the organization would need to contract with a CPA firm to perform the required audit.

What are the Source Regulations?

45 Code of Federal Regulations (CFR) 75.216 and 501(i) and (j) states that “Commercial Organizations” who receive HHS awards of $750,000 or more in a fiscal year are required to have either of the following two external audits performed within nine months of year end:

  1. A Single or program-specific audit (Single Audit) in accordance with 45 CFR Part 75 – Subpart F;

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Update: On March 25, 2022, the Washington Attorney General’s Office petitioned the Washington Supreme Court for direct review of the Douglas County Superior Court’s decision. The Supreme Court may accept direct review or may defer to the Court of Appeals to issue a decision before it accepts the case.

On Monday, March 1, 2022, the Douglas County Superior Court ruled Washington’s new capital gains tax, which took effect on January 1, 2022, violates the Washington State Constitution and is therefore invalid.

Background

Two lawsuits filed in the spring of 2021 by the Freedom Foundation and former Attorney General Rob McKenna were subsequently consolidated into a single case;

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Posted by: Amy Hernandez in Cryptocurrency.

Cryptocurrency is here to stay, and more and more not-for-profit (NFP) organizations are being faced with the decision on whether to accept these assets as gifts, and if they decide to, what to do next?

Although the Financial Accounting Standards Board (FASB) is still working on clarifying guidance for this unique asset, there are generally accepted accounting principles (GAAP) considerations to be followed today. As such, the first decision an organization must make when agreeing to receive cryptocurrency is to determine if they will sell or hold, and if they’ll handle this directly or through a third-party.

Selling and Holding Cryptocurrency

If an organization chooses to immediately sell the donated cryptocurrency,

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What Is the New Capitalization Rule?

New federal tax rules require businesses to capitalize and amortize certain research and development (R&D) costs. Historically, the rules permitted the immediate write-off of R&D expenses. Now, companies which are generating revenue could be required to pay tax because they are no longer able to use R&D costs incurred during the year to generate losses. This is because a large portion of the tax deduction associated with the costs is delayed under the new rule.

Example

Suppose in 2021 Company A generates $500,000 of revenue and incurs $1,000,000 of deductible R&D expenses (i.e., salaries, certain indirect expenses,

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A Quality of Earnings (QoE) report is often compared to a home inspection, and it’s an analogy that resonates for many reasons. An independent party is hired to complete an unbiased analysis, it is typically completed in advance of a significant transaction for the buyer and seller, and the exact contents of the inspection are not always the same. Certain homes require special attention in areas that other homes do not, and the same goes when evaluating businesses.

The contents of a QoE report are as wide and as varied as the companies they are covering then. Each report is tailored to meet the needs of the requesting party,

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In the current climate, global expansion is a common route for nonprofit organizations if they wish to continue expanding and achieving their exempt purpose with a broader impact. And while COVID-19 has made this process easier in some respects (more remote technology and online processes), the U.S. tax law that relates to nonprofits with international operations and investments hasn’t changed or evolved during the pandemic.

As such, it’s essential to be aware of the legal matters, reporting requirements, and risks associated with operating internationally. Understanding the U.S. filing obligations associated with international activities is necessary to know because the penalties can be quite large for missed filings.

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