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Best Practices for Board Financial Oversight 

In not-for-profit organizations, the board of directors plays a vital role in guiding mission, strategy, and accountability. One of the most important responsibilities a board holds is ensuring sound financial oversight. Strong financial governance not only protects the organization’s assets but also builds trust with donors, grantors, and the community. When board members understand their …

In not-for-profit organizations, the board of directors plays a vital role in guiding mission, strategy, and accountability. One of the most important responsibilities a board holds is ensuring sound financial oversight. Strong financial governance not only protects the organization’s assets but also builds trust with donors, grantors, and the community. 

When board members understand their financial duties and actively engage in oversight, they help create an organization that is transparent, compliant, and positioned for long-term sustainability. 

Understanding the Board’s Financial Role 

Board members serve as stewards of the organization’s resources. Their primary financial responsibilities include approving budgets, monitoring financial performance, and ensuring that appropriate controls are in place to prevent misuse of funds. 

Effective financial oversight involves: 

  • Reviewing financial statements regularly and asking clarifying questions  
  • Ensuring compliance with regulatory and donor requirements  
  • Overseeing internal controls and risk management practices  
  • Supporting long-term financial planning and sustainability  

While management handles day-to-day financial operations, the board’s role is to provide governance, accountability, and a big-picture perspective. 

Key Elements of Strong Financial Oversight 
  1. Review Financial Statements Regularly
    Board members should receive and review financial reports such as balance sheets, income statements, and budget-to-actual comparisons on a consistent basis. Look for trends, variances, and potential red flags. Clear,timely reporting ensures that the board can make informed decisions and respond proactively to financial challenges. 
  2. Maintainan Active Finance Committee 
    A dedicated finance committee can help the board fulfill its oversight responsibilities more effectively. This committee should work closely with management to review budgets, monitor cash flow, and assess financial policies before presenting recommendations to the full board. 
  3. Approve Realistic Budgets
    The board shouldparticipate in developing and approving the annual budget to ensure alignment with the organization’s mission and strategic goals. A well-structured budget balances program priorities with operational needs and includes contingency planning for unexpected expenses. 
  4. Ensure Proper Internal Controls
    Strong internal controls protect the organization from errors, fraud, and mismanagement. The board should confirm that key controls are in place such as segregation of duties, authorization procedures, and financial reviews and that they are tested periodically for effectiveness.
  5. Monitor Cash Flow and Reserves
    Cash flow management is essential for financial stability. The board should review cash flow projections and understand how reserves are being managed.Maintaining appropriate reserves provides flexibility and security, especially during periods of funding uncertainty. 
  6. Oversee Audits and Reviews
    Boardsare responsible for engaging independent auditors and reviewing audit results. This process offers valuable insights into the organization’s financial health and the strength of its internal controls. The board should also ensure that management addresses any recommendations identified in the audit report. 
  7. Support Transparency and Accountability
    Transparency in financial reporting builds trust among donors, staff, and the community. Boards should ensure that financial information is communicated clearly and accurately in annual reports, IRS Form 990 filings, and other public disclosures.
Encouraging Financial Literacy Among Board Members 

Not every board member will have a financial background, but every member should understand the basics of not-for-profit finance. Providing regular training on reading financial statements, interpreting budgets, and understanding compliance requirements equips the board to fulfill its oversight duties confidently. 

Encourage open dialogue during board meetings, creating a space where members feel comfortable asking questions and seeking clarification. A board that is engaged and informed contributes meaningfully to the organization’s financial integrity. 

Building a Culture of Financial Stewardship 

Financial oversight is more than a procedural duty. It is a reflection of organizational values. When the board prioritizes fiscal responsibility and transparency, it sets the tone for the entire organization. This culture of stewardship strengthens credibility, fosters donor confidence, and supports mission-driven growth. 

Proactive oversight ensures that financial challenges are identified early and addressed strategically, allowing the organization to remain resilient and focused on its goals. 

How DBC Can Help 

At DBC, we understand the vital role boards play in not-for-profit financial stewardship. Our team provides training, consulting, and audit services designed to help board members understand their financial responsibilities and strengthen oversight practices. 

Whether your organization is refining its internal controls, developing governance policies, or reviewing financial reports, we can help your board make informed, confident decisions that safeguard your mission and ensure sustainability by fostering a culture of transparency, accountability, and financial strength. 

Succession Planning for Not-for-Profit Leadership and Financial Roles 

For not-for-profit organizations, leadership transitions are inevitable, but they do not have to be disruptive. Whether it is the retirement of a long-serving executive director, the departure of a finance manager, or the transition of a key board member, effective succession planning ensures that your organization’s mission continues seamlessly. By planning ahead, not-for-profits can preserve institutional …

For not-for-profit organizations, leadership transitions are inevitable, but they do not have to be disruptive. Whether it is the retirement of a long-serving executive director, the departure of a finance manager, or the transition of a key board member, effective succession planning ensures that your organization’s mission continues seamlessly. 

By planning ahead, not-for-profits can preserve institutional knowledge, maintain financial stability, and protect stakeholder confidence during times of change. 

Why Succession Planning Matters 

Leadership and financial roles in not-for-profits carry significant responsibility. These positions are often tied directly to the organization’s mission, relationships, and financial health. Without a plan in place, sudden departures can lead to confusion, gaps in oversight, and even risk to funding or compliance. 

Succession planning helps your organization: 

  • Prepare for both expected and unexpected leadership changes  
  • Maintain continuity in governance and financial management  
  • Strengthen long-term sustainability and resilience  
  • Demonstrate stability to donors, employees, and the community  

When managed proactively, leadership transitions can become opportunities for renewal and growth rather than sources of uncertainty. 

Identifying Key Roles and Responsibilities 

Effective succession planning starts by identifying which roles are critical to your organization’s success. For most not-for-profits, this includes: 

  • Executive leadership: Executive directors or CEOs who oversee mission, strategy, and community relationships  
  • Financial management: CFOs, finance directors, or accountants who ensure compliance, transparency, and fiscal health  
  • Board leadership: Officers who provide oversight, governance, and strategic direction  

Documenting key responsibilities, processes, and decision-making authority for these roles helps ensure continuity when transitions occur. 

Steps to Develop a Strong Succession Plan 
  1. Assess Current and Future Needs
    Evaluate your organization’s strategic goals anddetermine the leadership and financial skills required to achieve them. Consider how your needs might evolve over the next three to five years and identify any gaps in current capabilities. 
  2. Document Essential Knowledge and Procedures
    Capture key processes, contacts, and institutional knowledge before a transition occurs. Maintaining up-to-date job descriptions, financial procedures, and access controls ensures smoother handoffs and minimizes disruption.
  3. Develop Internal Talent
    Encourage professional development for current staff andidentify potential future leaders within your organization. Cross-training team members on financial and administrative tasks not only prepares them for advancement but also enhances organizational resilience. 
  4. Establishan Emergency Transition Plan 
    Unplanned departures can occur without warning. Create an interim leadership strategy that designates who will assume temporary responsibility for key functions until a permanent replacement is found. 
  5. Involve the Board Early
    The board of directors plays a crucial role in leadership continuity. Engage them in planning discussions and ensure they understand their responsibilities in overseeing transitions for both executive and financial roles.
  6. Review and Update Regularly
    Succession plans should be living documents. Revisit them annually to reflect organizational changes, updated job roles, and emerging priorities.
Maintaining Financial Continuity During Transitions 

Leadership changes often impact financial operations, making careful planning essential. To maintain stability: 

  • Ensure dual authorization for financial transactions and system access to prevent gaps in oversight  
  • Review internal controls to confirm that duties are properly segregated, even during temporary transitions  
  • Keep funder relationships informed to maintain trust and transparency throughout leadership changes  
  • Engage external advisors to provide continuity in accounting, audits, and reporting when internal transitions occur  

A proactive approach to financial continuity reinforces confidence among stakeholders and prevents interruptions in day-to-day operations. 

Building a Culture of Preparedness 

Succession planning is not just about filling positions. It is about building a culture of preparedness. When organizations view leadership continuity as part of long-term strategy, they empower employees, reassure donors, and strengthen community trust. 

Investing in leadership development today ensures that tomorrow’s transitions are handled with professionalism and stability, keeping your organization focused on its mission even during a time of change. 

How DBC Can Help 

At DBC, we understand that leadership and financial transitions can be complex. Our team works with not-for-profits to strengthen internal controls, establish clear succession processes, and ensure financial continuity through periods of change. 

Whether you are developing your first succession plan or refining an existing one, we provide the guidance and support to help your organization maintain stability, accountability, and confidence by building systems that sustain your mission over time. 

 

Forecasting Project Profitability: Tips for Contractors 

Profitability is one of the clearest indicators of a project’s success, yet it can be difficult to measure accurately while work is still underway. Material prices shift, labor needs evolve, schedules change, and unexpected conditions can influence costs long before a project is complete. Without a reliable forecasting process, contractors may not recognize developing problems until …

Profitability is one of the clearest indicators of a project’s success, yet it can be difficult to measure accurately while work is still underway. Material prices shift, labor needs evolve, schedules change, and unexpected conditions can influence costs long before a project is complete. Without a reliable forecasting process, contractors may not recognize developing problems until margins are already weakened. 

Strong profitability forecasting helps contractors understand where a project stands today and where it is likely headed. When supported by accurate data and practical financial tools, forecasting becomes an essential resource for guiding decisions throughout the life of the job. 

Start With Accurate Job Costing 

Profitability forecasts are only as strong as the data behind them. Job costing must reflect what is actually happening on site, not just what was planned. This includes labor hours, material usage, subcontractor costs, and equipment time. 

Accurate job costing helps contractors: 

  • Compare real costs to estimates 
  • Identify cost categories that are trending higher than expected 
  • Understand how field decisions affect financial outcomes 

This information provides the foundation for reliable forecasts. 

Use Work-in-Progress Reports to Track Progress 

Work-in-progress reports help contractors understand how costs and revenue align with project completion. WIP reporting highlights overbilling, underbilling, and the percentage of work completed, all of which influence profitability. 

When reviewed regularly, WIP reports help contractors adjust staffing, reschedule activities, or revise budgets before problems grow. 

Evaluate Project Assumptions Throughout the Job 

Forecasting requires revisiting the assumptions that guided the original bid. Market prices, labor availability, and project conditions rarely remain static from start to finish. Contractors should periodically evaluate whether the assumptions behind their estimates still hold true. 

Questions that support this review include: 

  • Has labor been more or less efficient than expected? 
  • Are material prices higher than when the estimate was created? 
  • Have any subcontractors adjusted their pricing or availability? 
  • Are there scheduling delays that could increase costs? 

This type of evaluation helps contractors update forecasts with real-time information. 

Monitor Change Orders and Their Financial Impact 

Change orders often shift a project’s financial outlook. Even small adjustments can affect labor needs, material requirements, and job sequencing. To maintain accurate profitability forecasts, contractors should track the financial impact of change orders as soon as they occur. 

When captured early, these changes can be incorporated into revised budgets and forecasts, helping contractors avoid surprises later in the project. 

Compare Estimated Profit to Earned Profit 

Estimated profit reflects what contractors expect to earn when the project is complete. Earned profit reflects what has been achieved to date based on progress and actual costs. Comparing these two helps contractors determine whether they are on track or drifting from their projections. 

A significant variance between estimated and earned profit may signal the need for schedule adjustments, budget revisions, or resource changes. 

Use Historical Data to Improve Future Forecasts 

Completed projects offer valuable insight. By reviewing past performance, contractors can identify trends such as recurring cost overruns, underestimated labor categories, or consistent delays in certain phases of work. 

Historical data strengthens future forecasting by helping contractors: 

  • Build more accurate estimates 
  • Anticipate common problem areas 
  • Improve staffing and scheduling decisions 
  • Refine procurement strategies 

This continuous improvement strengthens profitability over time. 

Strengthen Communication Between Accounting and the Field 

Forecasting is most accurate when financial information and field activity stay connected. Regular communication between project managers, accounting staff, and field supervisors ensures that both teams work with the same understanding of project status. This helps contractors adjust forecasts quickly and maintain a clear view of the project’s trajectory. 

Building Confidence in Project Performance 

Profitability forecasting gives contractors the visibility they need to manage projects with confidence. When supported by accurate job costing, clear reporting, and open communication, forecasting becomes a powerful tool for guiding decisions and protecting margins. 

At DBC, we work with construction companies to build forecasting processes that support stronger financial outcomes and long-term growth. If you would like to strengthen your approach to project profitability, our team is here to help. 

Managing Cash Flow in Work-In-Progress Construction Projects 

Cash flow is one of the most critical elements of any construction project, and long-term projects place even greater pressure on a contractor’s financial structure. These projects often span multiple seasons, require large upfront investments, and fluctuate in cost as labor and material needs evolve. Even profitable projects can become difficult to manage if cash …

Cash flow is one of the most critical elements of any construction project, and long-term projects place even greater pressure on a contractor’s financial structure. These projects often span multiple seasons, require large upfront investments, and fluctuate in cost as labor and material needs evolve. Even profitable projects can become difficult to manage if cash flow is not monitored closely. 

Strong cash flow management helps contractors maintain steady operations, keep projects moving, and avoid unnecessary financial strain. With the right planning and oversight, long-term work becomes more predictable and far easier to manage. 

Understanding Why Long-Term Projects Strain Cash Flow 

Long-term construction projects introduce unique challenges that shorter jobs rarely experience. Contractors may face: 

  • Extended payment cycles tied to specific milestones 
  • Rising material or equipment costs over time 
  • Delays that affect both scheduling and billing 
  • Changes in scope that alter the financial structure of the job 

Because these projects evolve continuously, cash flow must be monitored just as consistently. 

Build a Cash Flow Forecast That Follows the Project 

A detailed cash flow forecast should mirror the life cycle of the project. Forecasting helps contractors anticipate when expenses will occur, when payments are expected, and where cash shortages may develop. 

A strong forecast typically includes: 

  • Planned labor and subcontractor costs by phase 
  • Expected material purchases 
  • Billing schedules tied to milestones or monthly progress 
  • Contingency amounts for unexpected changes 

Updating the forecast as the project progresses helps contractors make decisions early rather than reacting after a problem appears. 

Strengthen Billing Practices 

Billing practices significantly influence cash flow in long-term projects. Delayed billings, underbillings, or unclear documentation can slow payments and create difficulties in meeting upcoming costs. 

Contractors benefit from reviewing whether their billing practices: 

  • Align with contract terms 
  • Reflect work completed to date 
  • Include change orders promptly 
  • Follow a consistent monthly or milestone schedule 

Accurate and timely billing helps keep cash coming into the business at the pace needed to support the work. 

Monitor Work-in-Progress and Overbilling 

Work-in-progress reporting is an important tool for tracking cash flow. Overbilling and underbilling both influence the financial health of a project. 

  • Overbilling may improve short-term cash flow, but if costs later exceed expectations, it can reduce billing available in later phases. 
  • Underbilling restricts cash flow because work is completed without a corresponding payment. 

Monitoring WIP results helps ensure billing and work progression remain in balance. 

Manage Material Purchases Strategically 

Material pricing can shift significantly over long project cycles. Contractors may need to analyze whether materials should be purchased early, in phases, or through negotiated agreements with suppliers. 

Strategic purchasing decisions help avoid unexpected cost spikes and support better cash flow planning. 

Maintain Strong Communication With Subcontractors 

Subcontractor performance and timing affect both project progress and cash flow. Clear communication about scheduling, payment expectations, and documentation requirements helps prevent delays that can slow down billing. 

When subcontractors submit their paperwork consistently, contractors can bill earlier and more accurately. 

Protect Cash Flow During Change Orders 

Change orders are common in long-term work, but they can strain cash flow when not handled promptly. Costs related to changes should be documented and submitted quickly so that billing reflects the actual work being performed. 

A consistent change order process helps contractors: 

  • Maintain accurate budgets 
  • Prevent unapproved work from accumulating 
  • Ensure payment keeps pace with job progression 
Review Contract Terms Before the Project Begins 

Contract terms shape how cash flows throughout the project. Reviewing key components before work starts helps contractors avoid issues later. Important elements include billing frequency, retainage, milestone definitions, and payment turnaround times. 

Understanding these terms allows contractors to plan ahead and build a realistic cash strategy. 

Bringing Stability to Long-Term Projects 

Managing cash flow in long-term construction projects requires a combination of careful planning, consistent oversight, and clear communication. When contractors maintain strong forecasting, monitor job progress closely, and follow disciplined billing practices, they create a financial structure that supports long-term success. 

At DBC, we help construction companies strengthen their cash flow strategies, build reliable forecasting models, and create financial processes that support confident decision making. If you would like guidance on improving cash flow management for your long-term projects, our team is ready to help. 

Checking Your Federal Refund Status Is Easy

As you are no doubt aware, the IRS has made a significant shift in its approach to issuing  tax refunds by discontinuing the practice of sending refunds via paper checks. This change is part of an ongoing effort to enhance efficiency and security in processing tax returns. By moving towards electronic transfers, the IRS …

As you are no doubt aware, the IRS has made a significant shift in its approach to issuing  tax refunds by discontinuing the practice of sending refunds via paper checks. This change is part of an ongoing effort to enhance efficiency and security in processing tax returns. By moving towards electronic transfers, the IRS aims to reduce the risk of lost or stolen checks, expedite the refund process, and minimize costs associated with printing and mailing. The IRS has implemented alternative methods to accommodate taxpayers who do not have a bank account such as prepaid debit cards. 

Regardless of the delivery method, if you have already filed your federal tax return and are due to receive a refund, you can check the status of your refund online.

Where’s My Refund?  is an interactive tool on the IRS website.

Regardless of whether you have split your refund among several accounts or opted for a direct deposit into one account, Where’s My Refund? will give you online access to your refund information nearly 24 hours a day and 7 days a week.

If you e-file, you can use this tool to get your refund information 24 hours after the IRS acknowledges receipt of your return. Nine out of 10 taxpayers typically receive refunds in fewer than 21 days when they use e-file with direct deposit. If you file a paper return, refund information will be available starting four weeks after mailing your return. When you go to check the status of your refund, have a copy of your federal tax return handy. To access your personalized refund information, you must enter:

  • Your Social Security Number (or Individual Taxpayer Identification Number),
  • The tax year (options include 2025, 2024 and 2023),
  • Your filing status on that return (single, married filing jointly, married filing separately, head of household, or qualifying widow(er)/surviving spouse), and
  • The exact refund amount shown on your tax return.

Once you have entered your personal information, one of several personalized responses will come up:

  • Acknowledgement that your return has been received and is being processed,
  • Refund was approved and the IRS is preparing to issue it by the date shown.
  • Refund Sent – the IRS has sent the refund to your bank or to you in the mail. It may take 5 days for it to show in your bank account or several weeks for your check to arrive in the mail. 

Where’s My Refund?  also includes links to customized information based on your specific situation. The links guide you through the steps to resolve any issues that are affecting your refund. For example, if you do not receive your refund within 28 days of the mailing date shown on Where’s My Refund?, you can start a refund trace online.

Where’s My Refund? is also accessible to visually impaired taxpayers who use the Job Access with Speech screen reader with a Braille display. Where’s My Refund? is compatible with various modes of this screen reader.

IRS2Go is a free IRS smartphone app that lets taxpayers check on the status of their tax refunds. For download information, visit IRS2Go. It is available for both Apple and Android.

Where’s My Refund? provides the most up-to-date information that the IRS has. There’s no need to call the IRS unless Where’s My Refund? tells you to do so. Where’s My Refund? is updated every 24 hours (usually overnight), so you only need to check it once a day.

While the IRS tools provide helpful, real-time updates, DBC is available to assist if you encounter any issues or have questions along the way. We can help review your refund status, address delays or discrepancies, assist with initiating a refund trace if needed, and interpret any IRS notices you may receive.

In addition, we can provide guidance on how your refund fits into your overall tax situation, including applying it toward estimated payments or future planning strategies. If anything seems unclear or does not align with expectations, please reach out so we can help ensure everything is resolved efficiently.

Sold Your Home Before Meeting the Gain Exclusion Requirements? You May Still Qualify for a Partial Exclusion

When selling a principal residence, taxpayers turn to Section 121 of the Internal Revenue Code to mitigate potential capital gains taxes. Under this provision, homeowners can exclude up to $250,000 of gain ($500,000 for qualifying joint filers) from the sale. To fully qualify, individuals must have owned and lived in the home as their …

When selling a principal residence, taxpayers turn to Section 121 of the Internal Revenue Code to mitigate potential capital gains taxes. Under this provision, homeowners can exclude up to $250,000 of gain ($500,000 for qualifying joint filers) from the sale. To fully qualify, individuals must have owned and lived in the home as their primary residence for at least two out of the five years preceding the sale date. However, life sometimes unfolds in ways that prevent individuals from satisfying the full requirements for this lucrative exclusion. Thankfully, the IRS provides relief through partial exclusions for those who need to sell their home due to a change in the place of employment, health issues, or unforeseen circumstances before meeting the two out of the five years standard requirement. This article delves into understanding how these exceptions operate, offering insights into when taxpayers can still benefit from a Section 121 gain exclusion despite not meeting the standard criteria.

Change in Place of Employment – The most common reason for a partial exclusion is a job-related move that causes the taxpayer to sell their home before the 2-of-5 years tests were met. To meet the “safe harbor” for this category, your new place of work must be at least 50 miles farther from your home than your old workplace was. If you didn’t have a previous workplace, your new one must be at least 50 miles from the home you are selling.

Who does this apply to? Crucially, this condition does not just apply to the taxpayer. You may qualify for the partial exclusion if the change in employment affects:
  • The taxpayer.
  • The taxpayer’s spouse.
  • A co-owner of the home.
  • Anyone else for whom the home was their primary residence.

Health-Related Moves – A move is considered health-related if the primary reason is to obtain, provide, or facilitate the diagnosis, cure, mitigation, or treatment of a disease, illness, or injury. It also covers moving to provide medical or personal care for a family member. Note that a move for “general health and well-being” (e.g., moving to a warmer climate just because you like it) does not qualify; a doctor must generally recommend the change in residence.

Who does this apply to? The health condition is broad. It applies if the health issue affects a “qualified individual,” which includes:
  • The taxpayer, spouse, or co-owner.
  • Family members, specifically parents, grandparents, stepparents, children (including adopted, foster, or stepchildren), grandchildren, siblings, in-laws, aunts, uncles, nephews, and nieces.
  • Any resident of the home.

Unforeseen Circumstances – An “unforeseen circumstance” is an event you could not have reasonably anticipated before purchasing and occupying the home. If your situation does not fit a specific safe harbor, the IRS looks at factors like whether the event and sale were close in time, or if your financial ability to maintain the home was materially impaired. But merely deciding after you’ve lived in a home for a while that you don’t like the neighborhood won’t qualify as an unforeseen circumstance.

The Safe Harbor List – The IRS provides a specific list of events that automatically qualify as unforeseen circumstances:

  • Involuntary conversion (e.g., the home is destroyed or condemned).
  • Natural or man-made disasters or acts of terrorism resulting in a casualty loss.
  • Death of a qualified individual (taxpayer, spouse, co-owner, or resident).
  • Divorce or legal separation.
  • Eligibility for unemployment compensation.
  • Change in employment status that leaves the taxpayer unable to pay basic living expenses (food, housing, taxes, etc.).
  • Multiple births from the same pregnancy.

How the Partial Exclusion is Calculated – The partial exclusion is not a flat rate; it is a fraction of the maximum exclusion ($250,000 or $500,000).

  • The Formula – You take the shortest of the following periods (in days or months) and divide it by 730 days (or 24 months):
  1. The time you owned the home during the 5-year period before the sale.
  2. The time you used the home as your primary residence during that same period.
  3. The time since you last claimed the Section 121 exclusion for another home.

Example: If you are a single filer who lived in your home for 12 months before moving for a new job 100 miles away, and had last claimed the exclusion 6 years ago, you have met 50% of the 24-month requirement. You can exclude $125,000 (50% of $250,000) of your gain from taxes.

Navigating IRS Section 121 can be complex, especially when determining if your specific “facts and circumstances” meet the threshold for an unforeseen event. If you are planning a move or have recently sold a home before reaching the two-year mark, please contact DBC for assistance in calculating your exclusion and ensuring your documentation meets IRS standards.

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Why Spring Is the Perfect Time to Fix Your QuickBooks (Before Small Problems Get Expensive)

By springtime, most business owners have closed the books on last year, filed (or started filing) their taxes, and moved on. Here’s what many don’t realize: Spring is actually one of the most important times of the year to clean up QuickBooks. Why? Because small bookkeeping issues that look harmless now often turn into …

By springtime, most business owners have closed the books on last year, filed (or started filing) their taxes, and moved on. Here’s what many don’t realize: Spring is actually one of the most important times of the year to clean up QuickBooks.

Why? Because small bookkeeping issues that look harmless now often turn into expensive problems later, from missed deductions to cash flow surprises to tax-time headaches.

Here’s why March through May is the perfect checkpoint and what business owners should focus on right now.

Why QuickBooks Issues Show Up in the Spring

The first two months of the year are usually reactive. Businesses are:

  • Closing the prior year
  • Gathering documents for tax prep
  • Reconciling year-end accounts
  • Issuing 1099s
By springtime, the dust from the past year settles, and this year’s patterns begin to show. That’s when issues often become visible:
  • Expenses landing in the wrong categories
  • Duplicate or missing transactions
  • Uncleared balances lingering for months
  • Reports that don’t match reality
Spring is early enough to fix problems before they snowball, but late enough to see where they exist.
 
The Most Common QuickBooks Problems We See in Spring
1. “Ask My Accountant” Is Overflowing
This account is meant to be temporary. But many businesses leave transactions there indefinitely. The risk: Important expenses may not be deducted correctly, and financial reports may be inaccurate . Spring is the time to clear it out.
 
2. Bank Feeds Aren’t Fully Reviewed
Automation is helpful, until it’s not.
Many businesses rely on bank feeds without reviewing every transaction. That can lead to:
  • Misclassified expenses
  • Personal transactions in business books
  • Duplicate income entries
Even one bad habit repeated for months can distort financial reports.
 
3. Reconciliations Fell Behind
Some business owners reconcile accounts only at year-end (or skip it entirely). That can leave:
  • Missing Deposits
  • Duplicate charges
  • Incorrect balances
Monthly reconciliation is still the gold standard, and spring is the perfect time to reset the routine.
 
4. Balance Sheets That Don’t Make Sense
Many owners review their Profit & Loss statement but ignore the balance sheet. Common issues include:
  • Negative asset balances
  • Loans recorded incorrectly
  • Uncategorized equity entries
If the balance sheet doesn’t make sense, neither does the P&L.
 
Why Fixing It Now Saves Money Later
Waiting until year-end creates bigger problems:
  • Cleanup work becomes more expensive
  • Deductions may go unclaimed
  • Tax planning opportunities shrink
  • Cash flow decisions become guesswork
Spring offers a rare advantage: time to course-correct while the year is still young.
 
What Business Owners Should Do Right Now
If you use QuickBooks, spring is a great time to:
  • Review financial reports for accuracy
  • Reconcile every account
  •  Clean up uncategorized transactions
  • Meet with DBC for a “year-to-date”

Even one focused DBC cleanup session can prevent hours of stress later. 

QuickBooks Is a Tool, Not a Strategy

QuickBooks is excellent at tracking numbers. But it doesn’t evaluate them. It won’t tell you:

  • If your margins are slipping
  • If you’re underpaying estimated taxes
  • If you’re overspending in key areas
  • If your pricing needs adjustment
That’s where professional guidance makes the difference. The spring season brings one of the best opportunities all year to get ahead financially.
 
Fixing QuickBooks now helps ensure:
  • Accurate reporting
  • Smarter decisions
  • Fewer surprises
  • Lower stress at tax time
The earlier problems are caught, the easier and less costly they are to fix.
 
At DBC, we work with business owners to go beyond basic bookkeeping and turn their financial data into something they can actually use. Whether it’s cleaning up QuickBooks, reviewing year-to-date performance, or identifying opportunities before they become problems, our goal is to help you stay ahead rather than catch up. If you’re not fully confident in your numbers right now, we’re here to help.
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Estimated Tax Payments Are Not Just for the Self-Employed

Unlike employees, who have income, Social Security, and Medicare taxes withheld from their wages, self-employed individuals must prepay their taxes by making periodic estimated tax payments. These are referred to as estimated tax payments because the self-employed individual must estimate his or her net earnings for the year and pay taxes per an IRS …

Unlike employees, who have income, Social Security, and Medicare taxes withheld from their wages, self-employed individuals must prepay their taxes by making periodic estimated tax payments. These are referred to as estimated tax payments because the self-employed individual must estimate his or her net earnings for the year and pay taxes per an IRS schedule according to that estimate. Failure to do so will result in interest penalties.

The self-employed are not the only ones who are subject to estimated tax payment requirements; anyone who has income on which no income tax has been withheld, and even those whose taxes are not sufficiently withheld, should be making estimated tax payments. Thus, if you have income from stock sales, property sales, investments, taxable alimony, partnerships, S-corporations, inherited pension plans, or other sources that are not subject to withholding, you may also be required to pay either estimated taxes or an underpayment penalty. Others subject to making estimated payments are individuals who must pay special taxes such as the 3.8% tax on net investment income or the employment tax on household employees.

Although these payments are often termed “quarterly” estimates, the periods they cover do not usually coincide with a calendar quarter.

2026 ESTIMATED TAX INSTALLMENTS DUE DATES

Quarter Period Covered Months Due Date
First January through March 3 April 15th, 2026
Second April and May 2 June 15th, 2026
Third June through August 3 September 15th, 2026
Fourth September through December 4 January 15th, 2027

 

An underestimate penalty does not apply if the tax due on a return (after withholding and refundable credits) is less than $1,000; this is the “de minimis amount due” exception. When the tax due is $1,000 or more, underpayment penalties are assessed.

These underpayment penalties are determined per the periods as shown in the above table, so an underpayment in an earlier period cannot be made up for in a later period; however, an overpayment in an earlier period is applied to the following period.

The amount of an estimated payment is determined by estimating one fourth of the taxpayer’s tax for the entire year; the projected tax is paid in four installments. When the income is seasonal, sporadic, or the result of a windfall, the IRS provides a special form, and the underpayment penalty is based on actual income for the period.

For individuals who do not want to take the time to estimate their tax for the current year but who still want to avoid the underpayment penalty, Uncle Sam also provides safe-harbor estimates. However, even these can be tricky.
Generally, a taxpayer can avoid an underpayment penalty if his or her withholding and estimated payments are equal to or greater than:

  • 90% of the current year’s tax liability or
  • 100% of the prior year’s tax liability.
However, these safe harbors do not apply if the prior year’s adjusted gross income is over $150,000, in which case, the safe harbors are
  • 90% of the current year’s tax liability or
  • 110% of the prior year’s tax liability.
Sometimes, individuals who have withholding on some (but not all) of their sources of income will increase that withholding to compensate for the additional income sources that have no withholding. Although this may work, withholding adjustments are not as precise as the per-period payments and should be used with caution.
 
DBC can assist with estimating quarterly tax payments, evaluating and adjusting withholding strategies, and implementing safe harbor payment plans to help minimize penalties and improve cash flow planning. With the right approach in place, you can move forward with greater confidence knowing your tax obligations are being managed effectively.

When a Trust Complicates Farm Succession Planning

Keeping a farm in the family is rarely simple. It is not just about land or assets, but about legacy, relationships, and the responsibility of passing something meaningful to the next generation. Even with thoughtful planning, older estate documents can create challenges that were never anticipated, especially as circumstances change over time.  One situation that …

Keeping a farm in the family is rarely simple. It is not just about land or assets, but about legacy, relationships, and the responsibility of passing something meaningful to the next generation. Even with thoughtful planning, older estate documents can create challenges that were never anticipated, especially as circumstances change over time. 

One situation that comes up more often than many families expect involves testamentary trusts. These trusts are often created to protect assets and provide structure, but years later they can limit flexibility when plans need to evolve. 

When the Plan No Longer Fits the Reality 

Consider a situation we often see in farm succession planning. A farmer lost his wife more than a decade ago, and as part of her estate plan, her share of the farmland was placed into a trust. The trust specifies that, after his passing, her portion of the property will be divided equally among their four children. 

Since then, one of those children has stepped fully into the operation and built his future around farming. The father made a promise that he would find a way to keep the farm intact so his son could continue. The challenge is that the trust no longer reflects that goal, and it cannot be changed. 

This is where many families find themselves. The plan made sense at the time, but life moved forward in ways no one fully anticipated. 

Working With What You Can Control 

Even when part of the plan is fixed, there is often still room to adjust other pieces. In this situation, the father still controls his share of the property, which gives him the ability to influence how things unfold. 

He could choose to leave his portion of the home farm directly to the farming son. While that does not solve everything, it reduces the amount the son would need to purchase from his siblings. Another option is to balance things by allocating additional land from another parcel, helping create a more workable outcome for everyone involved. 

These adjustments may not be perfect, but they can move the family closer to the original intention. 

Looking at the Numbers Differently 

In some cases, the solution is not about changing the structure, but about adjusting how value is shared. 

If the trust requires full market value for its portion, the father may be able to offset that by offering more favorable terms on the assets he controls. A deeper discount on his share can help create a similar overall outcome to what the family originally envisioned. 

This approach requires careful planning, but it can help balance fairness across the family while still supporting the goal of keeping the farm intact. 

Having the Conversation Now, Not Later 

In many situations, the most important step is simply having an open conversation. 

If the goal is to keep the farm operating, it helps to bring the family together and talk through what that means in practical terms. Would the other children be open to allowing their sibling to purchase the land over time? Do they share the same long-term vision for the farm? 

These discussions are not always easy, but they are far easier to have now than during a time of loss. When expectations are clear, families are better positioned to move forward together. 

Setting Expectations With Care 

One of the more difficult moments for any family is when a will is read and something feels unexpected. Without context, decisions can feel unfair, even when they were made with good intentions. 

Taking the time to explain the reasoning behind the plan can make a meaningful difference. When family members understand the limitations created by the trust and the goal of preserving the farm, they are more likely to see the full picture. 

Planning With the Future in Mind 

Situations like this are a reminder that estate plans should not remain static. Over time, land values change, tax rules shift, and family roles evolve. What worked years ago may not support the same outcome today. 

Revisiting these plans periodically gives families the opportunity to adjust while options are still available. It also creates space to think through both the financial and personal aspects of succession. 

At its core, farm succession is about more than transferring property. It is about creating a path forward for the next generation while maintaining fairness across the family. With thoughtful planning and clear communication, it is possible to move closer to both. 

At DBC, we work with agricultural businesses and families to bring structure and clarity to these conversations. By focusing on long-term goals and practical realities, we help guide decisions that support both the operation and the people behind it. 

To read the full article by Mark McLaughlin visit https://www.agriculture.com/how-to-keep-the-farm-in-the-family-when-a-trust-gets-in-the-way-11825875 

U.S. Farm Income Expected to Decline in 2026 Despite Increase in Government Payments 

The financial outlook for U.S. agriculture is showing signs of strain. According to the U.S. Department of Agriculture, net farm income is projected to decline in 2026, even as government support reaches levels not seen in several years.  At first glance, the change appears modest. Net farm income is expected to fall ~0.7% to $153 billion. After …

The financial outlook for U.S. agriculture is showing signs of strain. According to the U.S. Department of Agriculture, net farm income is projected to decline in 2026, even as government support reaches levels not seen in several years. 

At first glance, the change appears modest. Net farm income is expected to fall ~0.7% to $153 billion. After adjusting for inflation, the decline is more pronounced, dropping $4 billion, or ~2.6% from the prior year. What stands out is how much of that income is being supported by government programs. 

A Larger Share of Income Coming From Government Payments 

Government payments are expected to account for nearly 29% of total farm income in 2026. Without that support, the picture changes significantly. USDA data shows net farm income would fall nearly 12% to $109 billion. 

That shift highlights a growing reliance on federal programs to stabilize farm operations. As one agricultural advisor noted, government payments are doing much of the work in supporting crop producers right now. 

Support Levels Not Seen Since Recent Disruptions 

USDA projects direct government payments will reach $30.5 billion in 2025 and increase to $44.3 billion in 2026, not including crop insurance indemnities. These levels have not been seen since 2020 and 2021, when pandemic disruptions and trade challenges led to similar support. 

The increase is tied to Farm Bill programs responding to lower crop prices, along with continued supplemental and disaster assistance. 

At the same time, many producers are carrying higher levels of debt while depending more heavily on these payments to cover operating costs. 

What Is Driving the Pressure 

Several factors are contributing to the current environment: 

  • Lower crop prices influenced by global supply levels 
  • A surplus in grain markets 
  • Lost export demand tied to past trade policies 
  • Ongoing pressure from operating costs, even as some inputs begin to stabilize 

While fuel and pesticide costs are expected to decline, overall financial pressure remains. 

A Mixed Outlook Across Commodities 

Income expectations vary across the agricultural sector: 

  • Corn receipts are expected to increase 
  • Soybean receipts are projected to remain relatively steady 
  • Wheat receipts are expected to decline 
  • Livestock receipts may fall due to lower egg and milk prices 
  • Cattle receipts are expected to continue rising 

This uneven performance adds another layer of complexity for farm operators managing multiple revenue streams. 

A Broader Concern Across the Industry 

Lawmakers and industry leaders are raising concerns about the direction of the farm economy. Some have pointed to growing financial stress among producers, while others have warned of the potential for broader instability if conditions do not improve. 

The USDA’s February report, which incorporated delayed data due to a prior government shutdown, has made it more difficult for economists to fully assess the pace and depth of these challenges. 

What This Means for Farm Operations 

For many farm owners, the concern is not just this year’s numbers. It is what those numbers suggest about long-term stability. 

When a larger share of income comes from external support rather than core operations, it becomes harder to plan with confidence. Cash flow, debt management, and future investment decisions all become more sensitive to factors outside of day-to-day operations. 

This is where financial clarity becomes especially important. Understanding how your operation performs both with and without government support can provide a more complete view of risk. 

Moving Forward With a Clearer View 

Agriculture has always faced cycles, but the current environment is a reminder that strong production alone does not guarantee strong financial results. A record harvest can still lead to tighter margins when prices are under pressure. 

At DBC, we work with agricultural businesses to help bring clarity to these situations. By focusing on cash flow, cost structure, and long-term planning, we help you make informed decisions in an environment that continues to shift. 

To read the full article by P.J. Huffstutter visit US farm income set to fall in 2026 despite surge in government payments | Reuters 

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.