Nonprofit Bookkeeping & Accounting Services

bookkeeping for nonprofits Lincoln

She uses a variety of accounting software for setting up client information, reconciling accounts, coding expenses, running financial reports, and preparing tax returns. She is also experienced in setting up corporations with the State Corporation Commission and the IRS. The final step in nonprofit bookkeeping is taking care of your tax obligations. Most nonprofits can apply to the IRS for a tax exempt status, which means that the nonprofit would be exempt from federal taxes under Section 501. With fund accounting, instead of putting all of the funds into one cash account, the money is distributed into different “buckets” or groups.

bookkeeping for nonprofits Lincoln

Perhaps of concentrating on sales, a non-profit’s financial records should reflect the organization’s commitment to its stated benevolent goal by properly allocating assets and resources. Nonprofit bookkeeping focuses more on the accountability of a company’s finances rather than on profits. Nonprofit is also based on non-distribution constraint which means that none of the earnings are distributed to the organization’s leaders. Finally, the tax status will more than likely differ between nonprofits and for-profits. Another major difference is between the statement of activities and the income statement.

Do nonprofits have to follow GAAP?

Our professional process will set your organization up for success in all of your financial management and accounting activities. Both for-profit and nonprofit organizations usually comply with generally accepted accounting principles (GAAP). These represent accounting rules that standardize reporting of financial statements.

As your nonprofit grows, you must protect yourself and the organization from fraud. You must keep these funds separate from your personal account to remain transparent and provide required reports to your board and the IRS. After you’ve registered as a nonprofit with your state, the next step is to apply for tax-exempt status under Section 501. For more information about how to create a budget, check out the National Council of Nonprofits guide to Budgeting for Nonprofits.


The basis for an accurate bookkeeping and accounting system is recording all financial transactions. We help nonprofits and small businesses succeed through fiscal sponsorship, Bookkeeping Services in Lincoln accounting and HR services, and specialty Impact Lab programs. Dedicated accounting, payroll, and financial reporting for nonprofits striving for organization growth.

  • Accountants must use your bookkeeping reports to analyze and present your organization’s financial status to the board, IRS, and other external characters.
  • We ensure nonprofits have the tools they need to partner with our team for effective financial record keeping and strategic planning.
  • You might be able to network with specific software providers who can supply you with a lower cost on software.
  • However, there are several actions all nonprofits need to take to ensure data quality and reliability.
  • For example, a lawyer may review a contract for your nonprofit and refuse to charge a fee.
  • Nonprofit is also based on non-distribution constraint which means that none of the earnings are distributed to the organization’s leaders.

QuickBooks for nonprofit bookkeeping is a great way to organize your expenses, donations, and financial information. It allows you to track your invoicing, billing, expenses, donations, and create detailed financial statements. Therefore, the statement of financial position has net assets, and the balance sheet has equity. Net assets include restricted assets and unrestricted assets while there are no restrictions on for-profit funds. Never use your own personal bank account for funds that belong in the nonprofit organization.

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Form 990 is an annual reporting return that certain federally tax-exempt organizations must file with the IRS. Guidestar has compiled a helpful FAQ for nonprofits concerned with filing this annual return. Once a year, you’ll send the required documents to an accountant to submit Form 990 to the IRS and provide tax documentation to staff. You will also need an accountant to audit your financial statements and help work with you on future financial plans.

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