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How Monthly Financial Reviews Can Improve Year-End Tax Outcomes for Agriculture Businesses

For many agricultural businesses, tax planning becomes a year-end conversation.By then, most of the year’s decisions have already been made. Revenue has been received, expenses have been paid, equipment may have been purchased, and cash flow has already moved through the business.Year-end planning still matters, but the best tax outcomes are often shaped much …

For many agricultural businesses, tax planning becomes a year-end conversation.

By then, most of the year’s decisions have already been made. Revenue has been received, expenses have been paid, equipment may have been purchased, and cash flow has already moved through the business.

Year-end planning still matters, but the best tax outcomes are often shaped much earlier. Monthly financial reviews give farmers and agribusiness owners a better view of where the year is heading, making it easier to make informed decisions before December arrives.

Tax Planning Starts With Good Information

Strong tax planning depends on accurate, timely financial information.

When books are only reviewed once or twice a year, it becomes harder to understand true profitability, cash flow, and taxable income. That can lead to rushed decisions at year-end, especially when trying to reduce income or manage deductions.

Monthly reviews help answer important questions throughout the year:

  • Is income tracking higher or lower than expected?
  • Are expenses increasing in certain areas?
  • Is cash flow strong enough to support new purchases?
  • Are estimated tax payments still appropriate?
  • Are there upcoming decisions that could affect taxable income?

These questions are easier to address when there is time to plan.

Better Visibility Into Income and Expenses

Agricultural operations often face fluctuating income and expenses. Commodity prices, input costs, weather, equipment repairs, and timing of payments can all affect financial results.

Monthly financial reviews help identify changes early.

For example, if income is trending higher than expected, there may be time to evaluate options before year-end. That could include reviewing prepaid expenses, retirement plan contributions, capital purchases, or income deferral opportunities.

If income is lower than expected, the focus may shift toward preserving cash, adjusting estimated tax payments, or delaying certain expenses.

Either way, the business is making decisions based on current financial information rather than a year-end estimate.

Avoiding Rushed Year-End Decisions

When tax planning waits until the end of the year, decisions can become reactive.

This is especially common with capital purchases. A farm may consider buying equipment to reduce taxable income, but the purchase still needs to make sense operationally and financially.

Monthly reviews create more room to evaluate whether a purchase fits the business. Owners can consider cash flow, financing, equipment needs, and long-term value before making a decision.

The tax benefit may be helpful, but it should support a sound business decision rather than drive it.

Managing Cash Flow Alongside Tax Strategy

Tax planning and cash flow planning should work together.

A strategy that reduces taxable income may not be the right choice if it creates unnecessary pressure on cash flow. Similarly, delaying income or accelerating expenses may help in one year but create challenges in the next.

Monthly reviews help business owners see the full picture. They can evaluate how tax decisions may affect loan payments, operating expenses, payroll, input purchases, and future liquidity.

This is especially important in agriculture, where timing and seasonality can make cash flow uneven throughout the year.

Improving Estimated Tax Planning

Monthly reviews can also help improve estimated tax planning.

When income changes significantly during the year, estimated tax payments may need to be adjusted. Waiting until year-end can result in underpayment, overpayment, or missed planning opportunities.

Regular financial review allows owners and advisors to monitor taxable income throughout the year and make more informed adjustments as needed.

Building a Stronger Year-End Planning Process

Monthly financial reviews do not replace year-end tax planning. They make it more effective.

By the time year-end arrives, the business should already have a reasonable understanding of income, expenses, cash flow, and potential tax exposure. That makes the final planning conversation more focused and practical.

Instead of trying to solve everything in December, the business can confirm the plan, review remaining opportunities, and make final adjustments with more confidence.

A Better Rhythm for Decision-Making

Agricultural businesses operate in a changing environment. Monthly financial reviews provide a regular rhythm for evaluating performance and making decisions with better information.

This process can help owners:

  • Track profitability throughout the year
  • Identify tax-planning opportunities earlier
  • Make stronger capital-purchase decisions
  • Manage cash flow more effectively
  • Reduce surprises at year-end

The goal is not to create more administrative work. The goal is to make financial information more useful.

A Final Thought

Year-end tax outcomes are rarely shaped by one decision. They are usually the result of many decisions made throughout the year.

Monthly financial reviews help agricultural businesses stay ahead of those decisions. With timely information and regular conversations, owners can better align tax planning, cash flow, and long-term business goals.

At DBC, we work with agricultural businesses to review financial performance, evaluate tax-planning opportunities, and prepare for year-end with a more complete understanding of the business. If you want to strengthen your planning process, monthly financial reviews are a practical place to start.

This article provides general tax and accounting insights and is not intended as advice specific to your organization or a substitute for personal consultation. We do not provide legal advice. Because every organization’s circumstances are unique, we encourage you to consult with your legal, tax, or accounting advisor regarding your specific situation.

Understanding Michigan Sales and Use Tax Rules for Not-for-Profits

Many not-for-profit organizations assume that tax-exempt status automatically means exemption from sales and use tax. In reality, Michigan’s sales and use tax rules are more nuanced, and misunderstanding them can lead to unexpected liabilities, compliance issues, or missed opportunities for exemption.Understanding when exemptions apply and when taxes must still be paid is an important …

Many not-for-profit organizations assume that tax-exempt status automatically means exemption from sales and use tax. In reality, Michigan’s sales and use tax rules are more nuanced, and misunderstanding them can lead to unexpected liabilities, compliance issues, or missed opportunities for exemption.

Understanding when exemptions apply and when taxes must still be paid is an important part of maintaining compliance and protecting organizational resources.

Understanding Sales Tax vs. Use Tax

Before exploring exemptions, it is helpful to understand the difference between sales tax and use tax.

Sales tax is generally charged on taxable purchases made within Michigan.

Use tax applies when sales tax was not collected at the time of purchase, often involving online, out-of-state, or remote vendors. In these situations, the purchaser may be responsible for remitting the tax directly.

For many not-for-profits, use tax compliance is frequently overlooked because the obligation is less visible than sales tax charged at checkout.

Are Not-for-Profits Automatically Exempt?

One of the most common misconceptions is that federal tax-exempt status automatically exempts an organization from Michigan sales and use tax.

In most cases, this is not true.

While certain qualifying organizations may be eligible for exemptions under Michigan law, exemption from federal income tax under Section 501(c)(3) does not automatically eliminate sales or use tax obligations.

Organizations should evaluate their specific activities, purchases, and fundraising efforts to determine whether exemptions apply.

Common Areas of Confusion

Purchases Made by the Organization

Some purchases made directly by qualifying not-for-profit organizations may be exempt from Michigan sales and use tax. However, exemptions often depend on factors such as:

  • The organization’s exempt status
  • How the item will be used
  • Whether the purchase is made directly by the organization
  • Proper documentation provided to the vendor

If an employee or volunteer makes a purchase personally and later seeks reimbursement, the transaction may not qualify for exemption even if the item is ultimately used for organizational purposes.

Fundraising Sales

Many not-for-profits generate revenue through fundraising events, merchandise sales, auctions, or special campaigns.

These activities can create sales tax obligations depending on the nature and frequency of the event and the items being sold.

Organizations should carefully evaluate:

  • Merchandise sales
  • Ticketed events
  • Silent and live auctions
  • Online fundraising stores
  • Sales conducted through third-party platforms

Assuming that all fundraising revenue is automatically exempt can create compliance risks.

Online and Out-of-State Purchases

As organizations increasingly purchase software, supplies, equipment, and services online, use tax becomes more relevant.

If a vendor does not collect Michigan sales tax, the organization may still owe use tax on the purchase.

Regular reviews of accounts payable records can help identify transactions where use tax may apply.

Best Practices for Maintaining Compliance

Establish Clear Purchasing Procedures

Organizations should develop policies that identify:

  • Who may make tax-exempt purchases
  • Required exemption documentation
  • Approval processes for purchases
  • Procedures for tracking taxable transactions

Clear policies reduce confusion and help ensure consistent treatment of purchases.

Review Fundraising Activities Annually

Fundraising methods often evolve over time. A review of planned events, merchandise sales, and online fundraising activities can help identify potential sales tax considerations before issues arise.

Monitor Use Tax Exposure

Many organizations focus heavily on sales tax while overlooking use tax obligations.

Periodic reviews of vendor invoices and online purchases can help identify areas where use tax may need to be accrued and remitted.

Maintain Supporting Documentation

Organizations should retain exemption certificates, vendor documentation, invoices, and records supporting tax-exempt purchases.

Good recordkeeping can simplify audits and help substantiate exemption claims if questions arise.

Why This Matters

Sales and use tax compliance may not receive the same attention as financial reporting or annual filings, but it remains an important part of sound financial management.

Even small errors can accumulate over time, particularly for organizations making frequent purchases or conducting multiple fundraising activities throughout the year.

Understanding the rules helps not-for-profits avoid unexpected liabilities, strengthen internal controls, and ensure resources remain focused on advancing their mission.

How DBC Can Help

At DBC, we work with not-for-profit organizations to navigate complex tax and compliance requirements, including sales and use tax considerations.

Whether your organization is evaluating exemption eligibility, reviewing fundraising activities, or assessing use tax exposure, our team can help identify potential risks and develop practical compliance strategies.

Proactive planning today can help prevent costly surprises tomorrow while allowing your organization to remain focused on serving its mission and community.

This article is intended for informational purposes only and should not be construed as legal, tax, or accounting advice. Because every organization’s circumstances are unique, we encourage you to consult with your legal, tax, or accounting advisor regarding your specific situation.

Potential Refund Opportunity for Certain COVID-Era Penalties and Interest

A recent decision from the U.S. Court of Federal Claims may create a protective refund-claim opportunity for some taxpayers. In Kwong v. United States, the Court of Federal Claims held that, under the version of §7508A(d) applicable to the COVID-19 disaster declaration, the mandatory disaster postponement period began on January 20, 2020 and ended …

A recent decision from the U.S. Court of Federal Claims may create a protective refund-claim opportunity for some taxpayers.

In Kwong v. United States, the Court of Federal Claims held that, under the version of §7508A(d) applicable to the COVID-19 disaster declaration, the mandatory disaster postponement period began on January 20, 2020 and ended on July 10, 2023. The court applied that interpretation to hold that the taxpayer’s refund suit was timely. The decision is broader than the COVID relief the IRS announced during the pandemic, which generally postponed only specified filing, payment, refund-claim, and other time-sensitive deadlines for limited periods.

The United States has appealed the decision to the Federal Circuit. If the taxpayer-favorable interpretation is sustained, some taxpayers may have refund or abatement opportunities for penalties, additions to tax, or interest tied to filing, payment, refund-claim, refund-suit, installment-payment, or other covered deadlines during the affected period.

Who Should Review This?

Taxpayers should consider reviewing their records if they paid, were assessed, or requested abatement or refund of:

  • Late-filing or late-payment penalties
  • Certain estimated-tax penalties
  • Interest connected with tax liabilities whose original filing or payment deadlines fell during the affected period, including potentially calendar-year 2019 through 2022 federal income tax liabilities
  • Installment-agreement payments or other covered IRS payment obligations due during the affected period
  • Amounts connected with refund claims or refund suits the IRS treated as untimely

This may also matter if the IRS denied a refund claim as untimely or if a taxpayer did not file a claim because the claim appeared to be outside the normal limitations period.

Timing Matters

Refund claims are subject to strict statute of limitations rules. Most taxpayers will need to file claims by July 10, 2026. Waiting for final court resolution may result in losing the opportunity.

Filing a protective claim may help preserve your ability to recover amounts while additional guidance and litigation continue. These claims are typically filed on Form 843 and must be submitted on paper, which adds an administrative layer and makes early action important.

How De Boer, Baumann & Company Can Help

Evaluating this opportunity requires a detailed, fact-specific review. Our team can help identify whether you are impacted, quantify potential refunds, and prepare claims within the required timeframes.

If you would like us to review your situation, please contact us to discuss next steps.

This article provides general tax and accounting insights and is not intended as advice specific to your organization or a substitute for personal consultation. We do not provide legal advice. Because every organization’s circumstances are unique, we encourage you to consult with your legal, tax, or accounting advisor regarding your specific situation.

Stronger Not-for-Profit Leadership Starts With Stronger Board Partnerships

Not-for-profit leaders carry a tremendous amount of responsibility. They balance mission delivery, staffing challenges, fundraising pressure, board expectations, and community impact, often while working with limited resources. The commitment behind that work is undeniable. What becomes difficult, however, is sustaining momentum when leadership energy is constantly stretched across competing priorities. Strong organizations are rarely …

Not-for-profit leaders carry a tremendous amount of responsibility. They balance mission delivery, staffing challenges, fundraising pressure, board expectations, and community impact, often while working with limited resources.

The commitment behind that work is undeniable. What becomes difficult, however, is sustaining momentum when leadership energy is constantly stretched across competing priorities.

Strong organizations are rarely built through hard work alone. They are built through intentional leadership practices that strengthen relationships, improve governance, and reinforce organizational credibility over time.

Below are three areas not-for-profit leaders should prioritize to build stronger, more sustainable organizations.

Invest in Internal Relationships First

Leadership effectiveness starts internally. Before organizations can grow externally, leaders need strong relationships with staff and leadership teams.

Employees want to feel heard, valued, and connected to the organization’s mission. Leaders who create that environment often see stronger collaboration, higher engagement, and better long-term retention.

Simple actions matter more than many leaders realize. Listening carefully during conversations, inviting feedback, and acknowledging staff contributions all help build trust. Employees are more likely to stay engaged when they believe their work and perspective genuinely matter.

Formal authority alone does not create loyalty or respect. Those are earned through consistency, communication, and support.

Build a True Partnership With the Board

Board engagement is another critical area that separates thriving organizations from struggling ones.

Boards play an important governance and fiduciary role, but the strongest not-for-profits move beyond compliance-focused relationships. Effective leaders view their boards as strategic partners.

That partnership requires open communication and meaningful discussion around organizational direction, impact, and long-term priorities. Board members often bring valuable professional experience, industry insight, and community relationships that can strengthen decision-making when properly engaged.

One practical approach is to dedicate a meaningful portion of board meetings to strategic conversation instead of reports and operational updates alone.

For example, leadership teams and board chairs can guide discussion around questions such as:

  • What measurable impact are we having on those we serve?
  • What differentiates our organization from others in the community?
  • Where do we see the greatest opportunities for growth or improvement?
  • What risks should we be discussing more proactively?

Those conversations help boards become more engaged, informed, and invested in the organization’s success.

Communicate Impact Consistently

Many not-for-profits believe they are “the best-kept secret in town.” Unfortunately, that mindset can limit fundraising, community engagement, and long-term sustainability.

Organizations cannot assume donors, stakeholders, and community partners fully understand the value of their work unless that impact is communicated consistently and clearly.

Leaders should regularly evaluate how well they measure and share outcomes. This includes both quantitative metrics and meaningful stories that demonstrate mission impact.

A helpful question for leadership teams to consider is this: if your organization had a “stock price,” what would it reflect today?

While not-for-profits are mission-driven rather than profit-driven, organizational reputation still matters. Strong financial stewardship, measurable outcomes, and visible community impact all contribute to stakeholder confidence.

Donors are far more likely to support organizations that demonstrate results, strategic direction, and operational stability.

Leadership That Strengthens Long-Term Sustainability

Building stronger staff relationships, developing meaningful board partnerships, and consistently communicating impact are not independent leadership responsibilities. They work together to strengthen organizational culture, governance, and sustainability.

For many not-for-profits, these areas become even more important during periods of uncertainty or growth. Organizations that invest in communication, accountability, and strategic alignment are often better positioned to navigate operational and financial challenges over time.

At DBC, we work with not-for-profit organizations to support financial oversight, governance practices, and long-term operational planning. Strong leadership and sound financial strategy often go hand in hand when organizations are working to expand impact and strengthen sustainability.

To read the original article by Dennis C. Miller, visit: https://thenonprofittimes.com/npt_articles/partnering-with-the-board-3-key-areas-to-develop/

Understanding Functional Expense Allocation and Why It Matters

For not-for-profit organizations, financial reporting is about more than simply tracking revenue and expenses. It is also about demonstrating accountability, transparency, and responsible stewardship of resources.One area that often creates questions for organizations is functional expense allocation.While it may seem like a technical accounting requirement, how expenses are allocated can significantly impact financial reporting, …

For not-for-profit organizations, financial reporting is about more than simply tracking revenue and expenses. It is also about demonstrating accountability, transparency, and responsible stewardship of resources.

One area that often creates questions for organizations is functional expense allocation.

While it may seem like a technical accounting requirement, how expenses are allocated can significantly impact financial reporting, grant compliance, and donor confidence. A thoughtful allocation process helps organizations present a more accurate picture of how resources support their mission.

Understanding the Purpose of Functional Expense Allocation

Functional expense allocation refers to the process of categorizing expenses based on their purpose within the organization.

In not-for-profit financial statements, expenses are generally grouped into three categories:

  • Program services
  • Management and general
  • Fundraising

This reporting structure helps stakeholders understand how the organization uses its resources to support mission-driven activities compared to administrative and fundraising efforts.

For many organizations, this information appears in the Statement of Functional Expenses, which is required for certain not-for-profit entities.

Why Functional Expense Allocation Matters

Functional expense reporting provides transparency to donors, grantors, board members, and regulators.

It helps answer important questions such as:

  • How much of the organization’s spending directly supports programs?
  • Are administrative costs reasonable for the size and complexity of the organization?
  • How are shared costs being managed and reported?

Accurate allocation also supports stronger internal decision-making. When leadership understands the true cost of programs and operations, it becomes easier to evaluate efficiency, budget effectively, and plan for growth.

Common Expenses That Require Allocation

Some expenses clearly belong to a single function. For example, program supplies used exclusively for client services would typically be recorded as program expenses.

Other costs support multiple functions and require allocation across categories.

Common shared expenses include:

  • Salaries and employee benefits
  • Rent and occupancy costs
  • Technology expenses
  • Insurance
  • Utilities
  • Office supplies

For example, an employee who spends time overseeing programs, attending administrative meetings, and assisting with fundraising activities may have compensation allocated across multiple functional areas.

The key is using a reasonable and supportable methodology.

Choosing an Allocation Method

There is no one-size-fits-all approach to expense allocation. The appropriate method depends on the nature of the organization and the expense being allocated.

Common allocation methods include:

  • Time and effort tracking for employee compensation
  • Square footage for occupancy-related expenses
  • Headcount or usage-based calculations for technology and administrative costs

The most important factor is consistency. Organizations should apply allocation methods consistently from period to period and maintain documentation supporting how calculations were determined.

Clear documentation becomes especially important during audits or grant reviews.

Avoiding Common Allocation Issues

Functional expense allocation can become problematic when organizations rely on estimates without support or fail to review allocation methods regularly.

Some common issues include:

  • Inconsistent allocation practices
  • Lack of supporting documentation
  • Overallocating expenses to program services
  • Failing to update methodologies as operations change

These issues can create reporting inaccuracies and raise concerns during financial statement audits or regulatory reviews.

Regular review of allocation practices helps ensure reporting remains accurate and aligned with current operations.

The Connection Between Allocation and Strategic Planning

Expense allocation is not only about compliance. It also provides valuable operational insight.

Understanding the full cost of delivering programs can help organizations:

  • Evaluate program sustainability
  • Prepare more accurate grant budgets
  • Support funding requests
  • Make informed staffing and operational decisions

When organizations have a better understanding of where resources are being used, leadership can make more informed financial and strategic decisions.

Building Trust Through Accurate Reporting

Donors and grantors increasingly expect transparency around how organizations manage funds.

Clear and accurate functional expense reporting demonstrates accountability and reinforces confidence in the organization’s financial stewardship.

It also helps boards and leadership teams better understand operational costs and long-term financial needs.

A Final Thought

Functional expense allocation is an important part of not-for-profit financial reporting. While the process can feel detailed, it plays a meaningful role in transparency, compliance, and decision-making.

Organizations that take a thoughtful and consistent approach to allocation are better positioned to support their mission while maintaining strong financial reporting practices.

At DBC, we work with not-for-profit organizations to develop practical allocation methodologies, strengthen financial reporting, and support compliance requirements.

Whether your organization is refining its reporting processes or preparing for an audit, our team can help you evaluate your approach and build a stronger financial foundation.

Employee Spotlight: Sara Knight

Since joining DBC in 2023, Sara Knight has been a welcoming and steady presence in our Grand Haven office. As Front Office Administrator, Sara helps keep daily operations running smoothly while supporting both team members and clients throughout the office. Her role touches many areas of the firm, making her an important part of …

Since joining DBC in 2023, Sara Knight has been a welcoming and steady presence in our Grand Haven office. As Front Office Administrator, Sara helps keep daily operations running smoothly while supporting both team members and clients throughout the office. Her role touches many areas of the firm, making her an important part of the day-to-day experience for everyone who walks through the door.

Sara attended Eastern Michigan University, where she earned a degree in Communications with a minor in Sociology. Her background has helped shape the thoughtful, people-focused approach she brings to her work each day. Whether assisting clients, coordinating office needs, or supporting the team behind the scenes, Sara values creating a positive and organized environment for those around her.

One area Sara especially enjoys is continuing to learn more about the accounting profession and the work happening across the firm. Her curiosity and willingness to grow have made her a valued member of the team since joining DBC.

Outside of the office, Sara enjoys spending time with her husband, Andrew, and celebrating milestones with their son, Michael, who recently graduated from Spring Lake High School. She also enjoys thrifting, relaxing by her pool during the summer months, and unwinding after busy season. When asked what skill she would most like to master, her answer was perfectly folding fitted sheets, something many of us can appreciate. If given the chance to swap roles with someone at the firm for a day, she would choose George for the opportunity to experience a different side of the business.

Sara’s positive attitude, adaptability, and support for those around her make her an important part of our Grand Haven team. We are grateful for all she contributes and are proud to spotlight her this month!

Supporting Our Communities Through Community Impact Day

Recently, team members from our Holland, South Haven, and Grand Haven offices participated in local Community Impact Days organized through area chambers of commerce. These volunteer events gave our teams the opportunity to support organizations serving important needs across West Michigan. Our Holland and South Haven teams partnered with Gateway Mission, helping clean and …

Recently, team members from our Holland, South Haven, and Grand Haven offices participated in local Community Impact Days organized through area chambers of commerce. These volunteer events gave our teams the opportunity to support organizations serving important needs across West Michigan.

Our Holland and South Haven teams partnered with Gateway Mission, helping clean and organize the storefront and plaza areas, fill parking lot potholes, and assist with shop and sorting spaces. Gateway Mission supports individuals across Ottawa and Allegan counties by addressing homelessness, poverty, and addiction while helping people work toward long-term stability and recovery.

In Grand Haven, team members volunteered at Camp Blodgett to help prepare the camp for the summer season. Camp Blodgett provides traditional summer camp experiences for children who may not otherwise have the opportunity to attend, creating space for connection, growth, and lasting memories.

Community Impact Day is an opportunity to support organizations doing meaningful work in the communities where we live and work. We are grateful to partner with local organizations making a difference every day and proud of our team members who dedicated their time to serve alongside them.

 

What Not-for-Profits Should Watch as Federal Tax Changes Affect Charitable Giving

Changes to federal tax policy often create uncertainty for not-for-profit organizations, especially those that rely heavily on individual or corporate donations. While recent legislation may encourage more households to give overall, new research suggests total charitable giving could still decline compared to previous projections. According to a study from the Indiana University Lilly Family …

Changes to federal tax policy often create uncertainty for not-for-profit organizations, especially those that rely heavily on individual or corporate donations. While recent legislation may encourage more households to give overall, new research suggests total charitable giving could still decline compared to previous projections.

According to a study from the Indiana University Lilly Family School of Philanthropy, charitable giving in the United States in 2026 could decrease by approximately $5.69 billion under recent federal tax law changes. At the same time, researchers estimate the number of households making charitable contributions could increase significantly due to the introduction of a universal charitable deduction.

For not-for-profit organizations, these changes may create both challenges and opportunities.

Below are three areas organizations should evaluate as donor behavior continues to shift.

Understand How Your Donor Base May Be Affected

Not all organizations will experience these tax changes in the same way. The impact may depend heavily on where donations currently come from and how donors structure their giving.

Organizations that rely primarily on major gifts or corporate contributions could experience more pressure if tax incentives become less favorable for high-income donors and businesses. Meanwhile, organizations supported by broad community-based giving may benefit from increased participation tied to the universal charitable deduction.

Understanding donor concentration, giving patterns, and corporate funding exposure will become increasingly important as organizations evaluate future fundraising strategies.

Prepare for Changes in Donor Timing and Giving Patterns

The research also suggests some donors may begin adjusting how and when they give. Households or corporations near deduction thresholds may choose to “bunch” contributions into certain years to maximize tax benefits.

For not-for-profits, this could create fluctuations in annual giving patterns and cash flow timing. Organizations may need to adjust campaign strategies, donor communications, and financial forecasting to account for less predictable contribution schedules.

Smaller-dollar giving may also become more important over time. As more households become eligible for charitable deductions regardless of itemization status, organizations may have opportunities to strengthen recurring giving programs and broader donor engagement efforts.

Reevaluate Corporate Fundraising Strategies

One of the more significant findings from the research involves corporate giving. Researchers estimate corporate charitable contributions could decline under the new tax structure, reducing traditional tax-related incentives for businesses to donate.

As a result, not-for-profits may need to position corporate partnerships differently moving forward. Organizations that focus solely on tax advantages may face greater challenges than those emphasizing community impact, brand alignment, employee engagement, and long-term partnership value.

Corporate donors may still prioritize philanthropy, but the motivations behind those decisions could continue shifting away from tax strategy alone.

Balancing Uncertainty With Long-Term Planning

Tax policy changes rarely affect charitable giving overnight. Researchers note that donor awareness and behavior often evolve gradually as individuals and businesses become more familiar with new regulations and incentives.

For not-for-profit organizations, this creates an important opportunity to strengthen donor education, diversify fundraising strategies, and better understand how changing tax policies may influence long-term giving behavior. Organizations that proactively evaluate donor trends and communicate effectively with supporters may be better positioned to adapt as the philanthropic landscape continues to evolve.

At DBC, we work with not-for-profit organizations to strengthen financial planning, evaluate fundraising sustainability, and navigate evolving regulatory and economic conditions. Thoughtful planning and proactive communication can help organizations remain resilient during periods of change.

To read the original article by Paul Clolery, please visit:

https://thenonprofittimes.com/npt_articles/federal-tax-changes-might-cost-nonprofits-5-69b/

What Not-for-Profits Should Prioritize When Funders Rethink Due Diligence

For many not-for-profit organizations, due diligence can feel like a high-pressure compliance process focused primarily on identifying weaknesses or operational risk. Financial reviews, governance assessments, and policy evaluations are often necessary parts of securing funding, but traditional due diligence processes do not always reflect the realities organizations face, particularly those operating in resource-constrained or …

For many not-for-profit organizations, due diligence can feel like a high-pressure compliance process focused primarily on identifying weaknesses or operational risk. Financial reviews, governance assessments, and policy evaluations are often necessary parts of securing funding, but traditional due diligence processes do not always reflect the realities organizations face, particularly those operating in resource-constrained or politically sensitive environments.

As philanthropy continues to evolve, many funders are beginning to rethink how due diligence should work. Increasingly, organizations are shifting away from rigid vetting procedures and toward approaches that emphasize partnership, long-term sustainability, and organizational growth.

Below are three areas not-for-profits should pay close attention to as these conversations continue to evolve.

Understand Whether the Process Encourages Partnership

The tone and structure of a due diligence process can reveal a great deal about how a funder approaches its relationships with grantee partners. Processes focused entirely on compliance or deficiencies can create unnecessary barriers and discourage transparency from the beginning.

More collaborative funders are beginning to approach due diligence as a conversation rather than simply a checklist. Open-ended discussions give organizations the opportunity to explain operational realities, regional challenges, and long-term goals in a more meaningful way.

For not-for-profits, this shift creates opportunities to build stronger relationships with funders who value understanding context alongside financial oversight.

Evaluate Whether Funders Support Organizational Growth

Many not-for-profit organizations operate with limited administrative resources while still delivering meaningful community impact. Traditional due diligence frameworks often treat operational limitations as disqualifying rather than developmental.

Some funders are now recognizing that long-term sustainability may require investment beyond direct programming. Capacity-building support, governance training, improved financial systems, and operational development can all strengthen organizations over time.

Not-for-profits should pay attention to whether funders are willing to support organizational infrastructure alongside mission-driven work. In many cases, that support plays a significant role in long-term stability and effectiveness.

Pay Attention to How Funders Approach Risk

Organizations operating in challenging political, legal, or economic environments often face obstacles that make traditional compliance expectations difficult to meet. In some cases, strict funding requirements may unintentionally exclude organizations doing important community-based work.

Funders taking a more thoughtful approach to due diligence are beginning to recognize that meaningful impact sometimes requires flexibility and shared problem-solving. Alternative funding structures, regional partnerships, and customized operational approaches may help organizations continue serving their communities while strengthening governance and internal controls over time.

For not-for-profits, understanding how a funder approaches risk can provide important insight into whether the relationship will support long-term sustainability or create unnecessary operational strain.

Building Stronger Relationships Between Funders and Not-for-Profits

Due diligence remains an important part of responsible philanthropy, but it can also serve as an opportunity to strengthen communication, improve operational support, and build more sustainable funding relationships.

For not-for-profits, thoughtful due diligence processes often signal a funder’s willingness to invest not only in programs, but in the long-term health and sustainability of the organization itself.

At DBC, we work with not-for-profit organizations to strengthen financial oversight, improve governance practices, and support long-term operational sustainability. Strong financial management and meaningful partnership can work together to create more resilient organizations and stronger community impact.

To read the original article by Geraldine Moreno, please visit https://ssir.org/articles/entry/due-diligence-deeper-partnerships 

Common Tax Planning Mistakes We See in Agricultural Operations

Agricultural operations face a unique set of challenges when it comes to tax planning.Income can vary significantly from year to year. Expenses often fluctuate with weather, market conditions, and timing of production cycles. These factors make proactive planning especially important.At the same time, certain patterns tend to show up consistently. Small missteps, repeated over …

Agricultural operations face a unique set of challenges when it comes to tax planning.

Income can vary significantly from year to year. Expenses often fluctuate with weather, market conditions, and timing of production cycles. These factors make proactive planning especially important.

At the same time, certain patterns tend to show up consistently. Small missteps, repeated over time, can lead to missed opportunities or unnecessary tax exposure.

Treating Tax Planning as a Year-End Exercise

One of the most common issues is waiting until year-end to think about taxes.

By that point, many decisions have already been made. Income has been earned, expenses have been incurred, and options may be limited.

Agricultural operations benefit from ongoing planning throughout the year. This allows for more flexibility in managing income, timing expenses, and making informed decisions as conditions change.

Not Aligning Tax Strategy with Cash Flow

It is possible to reduce taxable income while creating cash flow strain.

For example, accelerating expenses into the current year may lower taxes, but it can also reduce available cash needed for operations, equipment, or debt payments.

Balancing tax strategy with cash flow is essential. Decisions should support both objectives, not just one.

Overlooking Depreciation and Capital Planning

Equipment purchases are a regular part of agricultural operations, and the related tax treatment can be complex.

Some businesses take full advantage of accelerated depreciation without considering long-term implications. Others underutilize available deductions.

A more thoughtful approach considers how depreciation fits into multi-year planning, rather than focusing only on the current year.

Inconsistent Recordkeeping

Accurate records are the foundation of effective tax planning.

Inconsistent tracking of expenses, inventory, or production costs can lead to errors in reporting and missed opportunities for deductions or credits.

Strong recordkeeping also supports better decision-making beyond tax compliance.

Missing Available Credits and Programs

Agricultural operations may qualify for various credits, incentives, or special provisions, depending on their activities and location.

These can include credits related to conservation efforts, energy usage, or specific types of production.

Without regular review, these opportunities are often overlooked.

Not Revisiting Entity Structure

As operations grow or change, the original business structure may no longer be the most effective.

Entity choice affects taxation, liability, and long-term planning. Periodically reviewing whether the current structure still aligns with the operation’s goals is an important step.

Bringing It All Together

Tax planning in agriculture is not about a single strategy.

It involves coordinating income, expenses, capital investments, and long-term goals in a way that supports both the operation and the individuals behind it.

Regular review, accurate reporting, and forward-looking decisions all play a role.

A Final Thought

Agricultural businesses operate in an environment where conditions can change quickly.

Having a consistent approach to tax planning helps create stability and reduces uncertainty.

At DBC, we work with agricultural clients to identify planning opportunities, improve reporting, and align tax strategies with overall business goals. If you would like to take a closer look at your current approach, we are here to help.

About us

De Boer, Baumann & Company provides professional accounting, tax, and business advisory services to individuals and businesses in West Michigan and the surrounding areas. With expertise in a variety of industries, DBC specializes in comprehensive and innovative solutions to help clients achieve their financial goals.