Non-Profit Posts

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Preparing for 2026–27: What Not-for-Profit Leaders Need to Know About the New Charitable Giving Rules

The passage of the 2025 Reconciliation Act, often referred to as the “One Big Beautiful Bill Act” (OBBBA), introduced sweeping updates to federal charitable giving regulations that will begin taking effect in 2026 and 2027. These changes will have far-reaching implications for not-for-profits, donors, and fundraisers across all sectors. For not-for-profit leaders, now is …

The passage of the 2025 Reconciliation Act, often referred to as the “One Big Beautiful Bill Act” (OBBBA), introduced sweeping updates to federal charitable giving regulations that will begin taking effect in 2026 and 2027. These changes will have far-reaching implications for not-for-profits, donors, and fundraisers across all sectors.

For not-for-profit leaders, now is the time to plan ahead. Understanding the new giving landscape early will help organizations adapt their fundraising strategies, communicate effectively with donors, and safeguard financial stability in the years ahead.

Key Changes to Charitable Giving Rules

A recent report from Arts, Culture, and Media Philanthropic Advisors, titled One Big Beautiful Bill Act and Charitable Giving in 2026: Guidance for Fundraisers, outlines several significant updates that will affect how individuals and corporations give.

Expanded Deduction for Non-Itemizers

Starting in 2026, taxpayers who do not itemize will be eligible for a charitable deduction on cash contributions, up to $1,000 for individuals and $2,000 for joint filers. Donations to private foundations and donor-advised funds do not qualify, and these amounts will not be adjusted for inflation. This change reintroduces a version of the universal charitable deduction, designed to encourage everyday donors to give.

Permanent 60 Percent Limit for Individual Cash Gifts

The new law makes permanent the increased deduction limit, 60% of adjusted gross income (AGI), for individuals contributing cash gifts to qualified charitable organizations. This continues a provision that had been temporary under prior legislation, ensuring greater flexibility for generous donors.

New 0.5 Percent Floor for Itemizers

Beginning in 2026, taxpayers who itemize may only deduct charitable gifts that exceed 0.5% of their AGI. In addition, those in the top tax bracket (37%) will receive a slightly reduced deduction value, 35 cents on the dollar rather than 37. While the difference may seem small, this adjustment could influence high-income donors’ giving behaviors.

Tax Credit for Scholarship Contributions

In 2027, a new tax credit of up to $1,700 will be available to taxpayers contributing to eligible scholarship-granting organizations that support students at private or religious K–12 schools. This credit will apply regardless of whether the taxpayer itemizes deductions, creating a new incentive for education-focused giving.

Corporate Deduction Floor Introduced

Corporate charitable giving will also be affected. Beginning in 2026, businesses can only deduct charitable donations that exceed 1% of taxable income, up to a ceiling of 10%. This change could encourage larger or multi-year giving commitments from corporate partners but may also require not-for-profits to adjust their approach to sponsorship and corporate engagement.

What These Changes Mean for Not-for-Profits

The new rules create both challenges and opportunities for not-for-profit organizations. While they may increase participation among smaller, non-itemizing donors, they could also complicate giving strategies for major donors and corporate partners. Strategic planning will be essential to help not-for-profits maintain balance across their donor bases.

1. Engaging Everyday Donors

The reinstated universal deduction for non-itemizers provides an opportunity to engage a wider pool of small donors. Not-for-profits should build fundraising campaigns that highlight how even modest contributions now carry tangible tax benefits. Messaging that connects giving directly to impact, such as “Your $100 gift not only supports our mission but is now tax-deductible”, can inspire participation from new supporters.

The upcoming scholarship tax credit also opens doors for organizations connected to education or youth programs. Communicating this new benefit early can help donors plan ahead and strengthen relationships with supporters interested in education equity.

2. Planning for Itemizers and Major Donors

For high-income donors and those who itemize, the 0.5% deduction floor and top-tier reduction may prompt new giving strategies. Fundraisers should be ready to discuss “bunching”, a method where donors concentrate multiple years of charitable giving into one tax year to exceed deduction thresholds and maximize impact.

Not-for-profits can also encourage legacy giving and planned gifts as donors evaluate long-term financial strategies. With the Act’s increase in estate and gift tax exemptions to $15 million for individuals and $30 million for couples, there’s greater opportunity for philanthropic estate planning that aligns with organizational sustainability goals.

3. Strengthening Corporate Partnerships

The new 1% minimum for deductible corporate giving means businesses will need to contribute at least that share of taxable income to qualify. Not-for-profits should position themselves as strategic partners by proposing multi-year sponsorships, collaborative campaigns, or pooled giving initiatives that help corporate donors meet thresholds while achieving meaningful community outcomes.

This shift may also prompt companies to become more intentional in selecting not-for-profit partners, valuing transparency, measurable results, and mission alignment more than ever before.

Turning Policy Changes into Strategic Opportunity

The OBBBA reforms introduce a mix of opportunities and challenges for the not-for-profit sector. While the expanded universal deduction could increase small-donor giving, the new floors and limits may temper large-scale contributions. Success in this new environment will depend on thoughtful, proactive engagement.

Not-for-profits should begin scenario planning now, reviewing donor data, updating messaging, and educating their supporters about how the rules will affect them. Creating segmented outreach strategies for small donors, major donors, and corporate partners will help organizations adapt smoothly to the evolving landscape.

How De Boer, Baumann & Company Can Help

At De Boer, Baumann & Company, we help not-for-profit navigate the complex intersection of tax regulation, fundraising, and financial strategy. Our team works alongside not-for-profit leaders to understand the implications of legislative changes, model potential impacts, and develop proactive approaches to donor engagement and compliance.

We partner with organizations to ensure they are prepared for what’s next, so they can continue focusing on what matters most: advancing their missions and strengthening their communities.

To read the full article by Timothy J. McClimon, please visit Forbes.

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Facebook and Volunteer Engagement: Maximizing Opportunity While Managing Risk

In an era of rapid social media change, it’s easy to overlook Facebook in favor of newer platforms like TikTok or Instagram. Yet despite its age, Facebook remains one of the most powerful communication tools available to nonprofits. According to the Pew Research Center, roughly seven in ten U.S. adults still use Facebook, making …

In an era of rapid social media change, it’s easy to overlook Facebook in favor of newer platforms like TikTok or Instagram. Yet despite its age, Facebook remains one of the most powerful communication tools available to nonprofits. According to the Pew Research Center, roughly seven in ten U.S. adults still use Facebook, making it one of the most widely used social platforms in the country.

For organizations seeking to connect with supporters, mobilize volunteers, and strengthen community engagement, Facebook continues to offer immense value. However, it also poses distinct challenges, particularly around data privacy, audience reach, and platform ethics. Understanding how to balance these opportunities and risks can help nonprofits make the most of this enduring digital space.

Leveraging Facebook for Volunteer Recruitment

With 96% of nonprofits maintaining a Facebook presence, the platform remains a vital recruitment tool. To use it effectively, nonprofits should first ensure that managing Facebook activity is a defined part of someone’s job responsibilities. Consistent posting and engagement are key to staying visible in followers’ feeds.

When posting volunteer opportunities, framing matters. Each post should connect volunteer participation directly to the organization’s mission or cause.

Deadlines, incentives, and timely messaging all help spark action. Even for ongoing opportunities, creating urgency, like “Sign up by December 1 to receive a volunteer welcome kit”, can boost engagement. Nonprofits can also expand their reach by cross-posting opportunities on networks such as VolunteerMatch or local community Facebook groups.

Another effective tactic is to personalize posts. Staff or volunteer coordinators can use their own voices to make posts more relatable: “I’ll be at our river cleanup this weekend, join me in making a difference!” This approach humanizes the organization and fosters a stronger sense of connection with prospective volunteers.

Finally, using Facebook’s event tools to promote volunteer days or training sessions can drive interest. Posts should link directly to the organization’s own “Volunteer With Us” webpage rather than relying on Facebook Messenger for sign-ups, ensuring a smoother and more secure experience.

Retaining and Recognizing Volunteers

Recruitment is only half the equation. Once volunteers are on board, maintaining engagement is just as important, and Facebook can be a useful tool for this as well.

Nonprofits that collaborate with partner or “affinity” organizations, such as churches, service clubs, alumni groups, or local businesses, should follow and tag those partners on Facebook when posting volunteer updates. Tagging these organizations acknowledges their contributions and helps extend the post’s reach to broader audiences.

Encouraging volunteers to share their own photos or reflections on social media also deepens engagement. For example, a volunteer might post a picture from a community event and tag both the nonprofit and their affinity group, inspiring others to get involved.

Organizations can strengthen volunteer relationships through personalized gestures online: posting birthday wishes (with consent), tagging volunteers in event photos, or simply “liking” their posts. These small actions build connection and demonstrate appreciation, helping to sustain long-term involvement.

Protecting Volunteer Privacy

While social media helps build community, it can also expose volunteers to unwanted visibility. Nonprofits should take proactive steps to protect their supporters’ privacy and data.

  • Avoid collecting personal information directly on Facebook. Instead, direct interested individuals to a secure volunteer sign-up form on your organization’s website.

  • Obtain written consent before sharing photos or tagging volunteers. This not only ensures compliance with privacy standards but also respects individual comfort levels.

  • Include a social media permission section in volunteer applications. This form can outline how photos, names, or stories might be used in newsletters or online platforms, allowing volunteers to choose the level of exposure they’re comfortable with.

While no process can eliminate all risks, establishing clear boundaries and policies helps make social media engagement safer for both the organization and its volunteers.

The Evolving Role of Social Media in Volunteerism

Volunteer management practices have changed dramatically over the years. Where once volunteer lists were built manually from local directories, nonprofits now use digital tools to connect with supporters worldwide. Yet the core principles remain the same: consistent communication, recognition, and trust-building are still at the heart of successful volunteer engagement.

Even as new social media platforms rise and fall in popularity, Facebook continues to be an essential part of many nonprofits’ outreach and volunteer recruitment strategies. Understanding the platform’s strengths, and navigating its challenges responsibly, can help organizations expand their reach, strengthen relationships, and grow their capacity for impact.

How De Boer, Baumann & Company Can Help

At De Boer, Baumann & Company, we know that volunteer engagement is central to a nonprofit’s success. Our team helps organizations strengthen operational strategies, from financial planning to program development and digital engagement.

We partner with nonprofits to navigate evolving challenges, whether that means adopting new technology, maintaining compliance, or building systems that support sustainable growth. By combining practical expertise with a deep understanding of the nonprofit landscape, we help organizations focus on what truly matters: advancing their missions and serving their communities.

To read the full article by Jan Masaoka, please visit Nonprofit Quarterly.

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Navigating What’s Next: Legislative Opportunities and Challenges for Not-for-Profits

As Congress moves beyond the “One Big Beautiful Bill Act” (OBBBA), a new wave of legislative priorities is beginning to take shape. These shifting dynamics present both opportunities and challenges for not-for-profit organizations, especially as the federal government revisits tax policy, funding decisions, and regulatory reform. For not-for-profits that engaged in advocacy during OBBBA’s …

As Congress moves beyond the “One Big Beautiful Bill Act” (OBBBA), a new wave of legislative priorities is beginning to take shape. These shifting dynamics present both opportunities and challenges for not-for-profit organizations, especially as the federal government revisits tax policy, funding decisions, and regulatory reform.

For not-for-profits that engaged in advocacy during OBBBA’s development, there are valuable lessons to carry forward. Strategic communication and proactive engagement helped the sector secure meaningful wins, including the removal of several proposed tax hikes and the establishment of a permanent charitable deduction for non-itemizing taxpayers. Those same tactics will be critical as not-for-profits face the next round of policy debates on Capitol Hill.

Lessons from the OBBBA Experience

When OBBBA was under consideration, not-for-profits faced potential tax provisions that could have significantly reduced the resources available for mission-driven work. Through coordinated outreach and clear messaging, the sector helped lawmakers understand how additional taxes, such as those on private foundations and employee parking benefits, would negatively affect their ability to serve communities.

The result was a favorable outcome: proposed tax increases were removed, and a permanent charitable deduction was secured for the 90% of taxpayers who do not itemize their returns. This achievement underscored how effective storytelling and sector-wide advocacy can shape legislative outcomes in ways that strengthen philanthropy and community investment.

Renewed Legislative and Tax Policy Risks

While the OBBBA chapter has closed, the possibility of renewed legislative threats remains. Congressional tax committee leaders have indicated that certain tax measures removed from the bill could resurface in future discussions, potentially aimed at raising federal revenue through changes to the tax-exempt sector.

At the same time, increased scrutiny of not-for-profits by both Congress and the White House has created a more cautious political environment. Organizations should be prepared for heightened oversight, expanded reporting expectations, and new compliance requirements that could emerge as part of broader fiscal reform efforts.

IRS Reform: A Double-Edged Sword

Lawmakers are also considering an Internal Revenue Service (IRS) reform package, one that could have both positive and challenging implications for charitable organizations.

On the positive side, reform could simplify tax filing for 501(c)(3)s, reduce administrative delays, and strengthen donor privacy protections. However, critics of the not-for-profit sector may push for additional disclosure requirements, including the reporting of foreign donations or international grantmaking data.

There is also discussion around potential changes to Form 990, the core financial disclosure document for not-for-profits. While reform could bring useful modernization and transparency, poorly designed amendments could also increase administrative burden and compliance costs.

Potential Progress on Retirement and Giving Incentives

One area that may offer bipartisan cooperation is retirement reform. Lawmakers are considering proposals that could support not-for-profit employees and encourage greater charitable participation.

This may include enhancements to 403(b) retirement accounts and adjustments that allow individuals with IRAs to make charitable contributions through donor-advised funds more easily. If these proposals gain traction, they could help not-for-profits attract and retain talent while also promoting philanthropy among donors.

The Importance of Advocacy and Engagement

Not-for-profits operating in today’s political environment face both heightened scrutiny and new opportunities to shape policy. Advocacy will play a central role in determining which direction future legislation takes.

During OBBBA negotiations, the not-for-profit sector’s unified, fact-based approach helped remove several unfavorable provisions and secure lasting charitable incentives. That success demonstrates the power of consistent, constructive engagement. As Congress revisits fiscal and tax policy in the months ahead, not-for-profits must continue to advocate early, collaborate with allies, and present practical policy solutions that highlight their community impact.

By engaging lawmakers in a proactive and solutions-focused manner, not-for-profits can ensure their perspectives are included in policy decisions that directly affect their missions.

How De Boer, Baumann & Company Can Help

At De Boer, Baumann & Company, we understand that legislative changes can have significant implications for not-for-profit organizations. Our team helps clients interpret emerging policy developments, assess financial risks and opportunities, and plan strategically in response to evolving regulations.

By staying informed and engaged, not-for-profits can navigate uncertainty with confidence, protecting their resources, strengthening compliance, and continuing to deliver vital services to the communities they serve.

To read the full article by Geoffrey Paul, please visit The NonProfit Times.

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Harnessing AI: Unlocking Opportunities for Not-for-Profits of All Sizes

Each year, the world loses roughly 32 million acres of natural forest, an area comparable to the entire state of Florida. Much of this destruction results from illegal logging, contributing to climate change and increasing the likelihood of diseases spreading between animals and humans. Addressing deforestation is a complex, global challenge, but one innovative …

Each year, the world loses roughly 32 million acres of natural forest, an area comparable to the entire state of Florida. Much of this destruction results from illegal logging, contributing to climate change and increasing the likelihood of diseases spreading between animals and humans. Addressing deforestation is a complex, global challenge, but one innovative not-for-profit has demonstrated that technology and creativity can offer a path forward.

Protecting Forests Through AI and Sound

Rainforest Connection, a not-for-profit based in Katy, Texas, developed a unique approach that leverages artificial intelligence (AI) and audio technology to combat illegal deforestation. Their system uses solar-powered recorders to continuously capture the natural sounds of the forest. These recordings are uploaded to the cloud, where an AI model analyzes the data to detect and even predict illegal logging activity.

What makes this approach groundbreaking is its predictive power. The AI can forecast where illegal logging is likely to occur up to five days in advance, with an accuracy rate of 96%. Experts estimate that widespread adoption of similar technologies could reduce illegal logging by as much as 35% globally.

AI’s Expanding Role in Social Good

Rainforest Connection’s work is just one example of how AI can be harnessed for positive change. The Nature Conservancy has deployed AI and camera systems to detect invasive species before they spread. The American Red Cross integrates AI and satellite imagery to assess disaster-related infrastructure damage. Similarly, the International Fund for Agricultural Development (IFAD) uses AI to analyze data, improve insights, and more effectively target assistance to vulnerable communities.

The potential applications of AI for mission-driven organizations are vast. As the technology evolves faster than any innovation before it, not-for-profits have a remarkable opportunity to responsibly integrate AI to enhance impact, improve efficiency, and strengthen fundraising and outreach.

Understanding AI Adoption in the Not-for-Profit Sector

Despite its potential, AI adoption among not-for-profits remains limited. A survey conducted by Google for Not-for-Profits, which included responses from 4,600 not-for-profit professionals, revealed that while 80% of managers believe AI could apply to their work, two-thirds identified a lack of familiarity as the primary barrier to adoption. Many organizations use AI tools for individual tasks but have not yet implemented them organization-wide.

Larger organizations may have more resources to explore AI, but smaller not-for-profits can also benefit significantly. Generally, not-for-profits can approach AI integration in two ways:

  1. Using Software-as-a-Service (SaaS) AI-powered solutions to enhance specific functions.

  2. Building custom AI tools and ecosystems to address mission-critical challenges.

Using Software-as-a-Service AI

The growing marketplace of AI-enabled SaaS platforms offers accessible entry points for not-for-profits. These tools can optimize operations, strengthen donor engagement, and reduce manual workloads, all without requiring specialized technical expertise or major investments.

Examples include:

  • Donor and relationship management: Platforms like HubSpot and Salesforce offer AI-powered CRM systems that help automate fundraising efforts, personalize communications, and track donor interactions more effectively.

  • Content creation and marketing: Tools such as Jasper AI, Writesonic, and Surfer SEO assist in generating professional content and improving visibility across digital channels.

  • Productivity and collaboration: Applications like Notion, Otter, Coda, and Taskade increase organizational efficiency by streamlining workflows and documentation.

  • Communication and coordination: AI-enhanced collaboration platforms such as Slack and Microsoft Teams help improve real-time engagement and information sharing.

  • Project management: Solutions like Asana and Trello integrate AI features that automate task prioritization and project tracking.

  • Creative design and media: Tools such as Canva, Adobe Firefly, Runway, and Pictory AI make it easier to develop visual and video materials for campaigns.

  • Generative AI assistants: Platforms like ChatGPT, Microsoft Copilot, Google Gemini, Meta AI, and Anthropic’s Claude provide intuitive chat interfaces that function as personal digital assistants, helping staff with research, communication, and administrative work.

 

By adopting these tools, even small and mid-sized not-for-profits can modernize operations, conserve resources, and improve overall efficiency. However, successful implementation requires adequate training and thoughtful change management to ensure staff are comfortable and confident using these technologies.

Building Custom AI Solutions to Maximize Impact

For organizations ready to take a deeper step into AI integration, building custom solutions can transform how they deliver their missions. These initiatives often involve tailoring AI applications or combining existing tools to address unique challenges faced by the organization.

Step 1: Define the Problem Creatively

The foundation of any successful AI initiative is identifying the right problem to solve. By rethinking traditional approaches, staff can discover innovative use cases where AI can make a meaningful difference. This stage requires open-mindedness, questioning long-standing processes, and imagining how they might evolve with technology. The creativity behind this step often determines the level of impact achieved.

Step 2: Experiment and Test

Once potential applications are identified, organizations should start small. A culture of experimentation allows teams to test ideas through low-cost proof-of-concept projects before committing extensive resources. This iterative approach helps refine solutions, uncover new insights from data, and reduce the risks of full-scale implementation.

Step 3: Engage Technical Expertise

Smaller not-for-profits may not have in-house data scientists or AI engineers, but they can still access technical talent in creative ways:

  • Volunteers: Recruit volunteers with AI or data backgrounds to assist in developing proof-of-concept solutions.

  • Student partnerships: Collaborate with universities through capstone projects, internships, or student innovation clubs interested in real-world problem-solving.

  • Pro bono partnerships: Some technology firms are open to supporting not-for-profit initiatives by donating staff time or expertise, particularly when there’s clear alignment with the organization’s mission.

  • Hackathons: Hosting or joining hackathons can help generate innovative solutions quickly while building connections with skilled technologists and potential long-term collaborators.

 

Before engaging technical partners, it’s essential to define the project’s scope, objectives, and data requirements to ensure feasibility and alignment with organizational goals.

Establishing Responsible AI Policies

As not-for-profits explore AI, it’s important to implement policies that promote ethical, transparent, and mission-aligned use of technology. Larger organizations may formalize comprehensive AI governance frameworks, while smaller ones can start by setting clear boundaries for acceptable use.

A responsible AI policy typically includes:

  • Ethical guidelines and accountability measures.

  • Compliance with regulatory and privacy requirements.

  • Safeguards for data security and confidentiality.

  • Defined risk management protocols.

 

Such policies foster trust among stakeholders and ensure that innovation aligns with organizational values. They also promote awareness and training, helping staff understand both the capabilities and limitations of AI systems.

An organization’s approach to AI should reflect its culture and tolerance for risk. Some may adopt a cautious, conservative stance, while others embrace experimentation. A well-designed policy provides flexibility while maintaining integrity and transparency.

Managing Change and Designing for People

As organizations grow in their AI journey, managing the human side of technological transformation becomes essential.

Change management ensures that staff adopt and effectively use new tools. AI solutions often require shifts in workflow or responsibilities, and employees may initially be skeptical of their outcomes. Successful change management includes transparent communication, clear expectations, and hands-on training to build trust in the new systems.

Human-factored design is equally critical. AI tools should complement human judgment, not replace it. Designing systems that are intuitive, ethical, and accessible helps ensure staff can override or adjust AI recommendations when necessary. Involving end-users early in the design process leads to higher adoption rates and better outcomes.

Looking Ahead

Artificial intelligence is becoming more visible across the not-for-profit sector, and many organizations are beginning to explore how these tools might fit into their work. While AI is still developing, staying aware of emerging trends can help leaders make thoughtful, informed decisions as the landscape evolves.

At De Boer, Baumann & Company, we continue to follow developments that may affect the not-for-profit community. Understanding which changes are relevant, which can be set aside, and how new tools may influence operations in the future can help organizations stay adaptable and prepared.

To read the full article by Sajit Joseph, please visit The NonProfit Times.

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Best Practices for Internal Controls in Not-For-Profit Organizations

For Not-For-Profit organizations, every dollar counts—and so does every decision. Strong internal controls are essential to ensuring that funds are managed responsibly, risks are minimized, and your organization’s mission stays on track.  Internal controls aren’t just about preventing fraud or errors—they’re about establishing a culture of transparency and accountability that builds trust with donors, …

For Not-For-Profit organizations, every dollar counts—and so does every decision. Strong internal controls are essential to ensuring that funds are managed responsibly, risks are minimized, and your organization’s mission stays on track. 

Internal controls aren’t just about preventing fraud or errors—they’re about establishing a culture of transparency and accountability that builds trust with donors, board members, and the community. Whether your Not-For-Profit organization is large or small, implementing sound control practices can safeguard assets and strengthen long-term sustainability. 

 

Why Internal Controls Matter 

Not-For-Profits operate under unique financial pressures and public expectations. Donors, grantors, and regulatory bodies all expect accurate reporting and responsible stewardship of resources. Internal controls provide the framework to meet those expectations. 

An effective system of internal controls helps your organization: 

  • Protect assets from loss or misuse 
  • Ensure the accuracy of financial reporting 
  • Promote compliance with laws and funding requirements 
  • Improve operational efficiency through clear procedures 
  • Build confidence among stakeholders and funding partners 

 

Ultimately, strong internal controls help ensure your Not-For-Profit can continue to fulfill its mission with integrity and consistency. 

 

Key Components of an Effective Internal Control System 

While every Not-For-Profit’s operations are unique, the following components are essential to a well-designed internal control framework: 

1. Segregation of Duties 

One of the most effective safeguards against errors or misuse of funds is separating responsibilities among multiple people. For example, the person who authorizes a payment should not also handle check signing or reconciliation. Even in small organizations, rotating duties or adding periodic oversight by board members can strengthen accountability. 

2. Clear Authorization and Approval Processes 

Establish written policies outlining who has the authority to approve transactions, sign checks, or enter into contracts. Consistent approval processes ensure decisions are reviewed appropriately and in line with your organization’s financial policies. 

3. Accurate Recordkeeping and Documentation 

Maintain detailed records for all financial activities, including invoices, receipts, and grant documentation. Digital accounting systems and cloud-based tools can simplify recordkeeping and improve accuracy, making it easier to track spending and respond to audit inquiries. 

4. Regular Reconciliations and Reviews 

Reconcile bank accounts, credit cards, and grant funds regularly to detect discrepancies early. Monthly or quarterly financial reviews by leadership or the board can help identify issues before they escalate. 

5. Oversight by the Board and Finance Committee 

Active oversight from the board of directors or a dedicated finance committee is critical. Reviewing financial statements, approving budgets, and evaluating risk management policies are all part of maintaining strong governance. Board involvement reinforces transparency and demonstrates accountability to external stakeholders. 

6. Use of Technology and Access Controls 

Implement accounting software with built-in security features, such as user access controls and audit trails. Limiting access to sensitive financial systems reduces the risk of unauthorized activity and ensures data integrity. 

7. Continuous Training and Improvement 

Internal controls are only as strong as the people who use them. Provide ongoing training to staff and volunteers on financial policies, reporting requirements, and ethical standards. Regularly review and update policies as your organization grows or as regulations change. 

 

Building a Culture of Accountability 

The most successful internal control systems are supported by an organizational culture that values integrity and transparency. When leadership models ethical behavior and open communication, staff are more likely to follow suit. 

Encourage employees and volunteers to raise concerns or suggest improvements to existing procedures. A proactive, collaborative approach to accountability fosters trust—both internally and with the communities you serve. 

 

How De Boer, Baumann & Company Can Help 

At De Boer, Baumann & Company, we understand that strong internal controls are vital to the success and sustainability of Not-For-Profit organizations. Our experienced team partners with Not-For-Profits to assess current systems, identify areas for improvement, and design practical, effective control frameworks that align with your mission. 

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Audit Requirements and Compliance for Not-For-Profits

For Not-For-Profit organizations, transparency and accountability are the foundation of trust. Whether your funding comes from grants, donations, or community partnerships, stakeholders expect assurance that resources are being managed responsibly. A well-executed audit not only fulfills regulatory requirements—it also demonstrates your organization’s commitment to integrity and good governance.  If your Not-For-Profit is preparing for …

For Not-For-Profit organizations, transparency and accountability are the foundation of trust. Whether your funding comes from grants, donations, or community partnerships, stakeholders expect assurance that resources are being managed responsibly. A well-executed audit not only fulfills regulatory requirements—it also demonstrates your organization’s commitment to integrity and good governance. 

If your Not-For-Profit is preparing for its first audit or looking to strengthen existing compliance practices, understanding what’s required and how to prepare can help you navigate the process with confidence. 

 

Why Audits Matter for Not-For-Profits

Audits provide an independent, objective review of your organization’s financial health. Beyond satisfying external requirements, they offer valuable insights that can help you improve internal processes, strengthen financial management, and enhance your reputation with funders. 

A thorough audit can help your organization: 

  • Reinforce donor confidence through verified financial reporting 
  • Identify opportunities to improve internal controls and efficiency 
  • Ensure compliance with funding agreements and state or federal laws 
  • Provide leadership and the board with reliable data for decision-making 

Many funding agencies and state regulators require audits once certain thresholds are met. Even when not required, voluntary audits can elevate your organization’s credibility and readiness for future growth. 

 

Understanding Audit Requirements 

Audit requirements for Not-For-Profits vary based on size, revenue, and funding sources. Below are some key areas to be aware of. 

Federal and State Thresholds 

Under the Uniform Guidance, organizations that expend $1 million or more in federal funds during a fiscal year are required to undergo a Single Audit. This audit examines both the organization’s financial statements and its compliance with applicable federal program requirements. (Note: The threshold increased from $750,000 to $1 million for fiscal years ending on or after September 30, 2025.) 

Michigan State Requirements 

At the state level, requirements vary by jurisdiction. In Michigan, charitable organizations that solicit contributions from the public must register with the Attorney General’s Charitable Trust Section. Updated thresholds now require: 

  • Audited financial statements for organizations with annual gross receipts exceeding $550,000, or total assets exceeding that amount. 
  • Reviewed or audited financial statements for organizations with gross receipts between $300,000 and $550,000. 
  • Organizations below these thresholds may submit compiled financial statements or other required filings. 

 

When calculating total annual gross receipts, the IRS notes that “contributions in the form of grants or similar payments from local, state, or federal government sources, as well as foreign governments,” are excluded (Form 990 instructions). This distinction can make a significant difference in determining whether your organization meets the audit threshold.

Michigan also allows a one-time audit waiver, offering limited flexibility for qualifying organizations that would otherwise be required to submit audited financials. 

Understanding both the updated federal Single Audit threshold and Michigan’s revised state-level audit requirements enables Not-For-Profits to plan proactively, allocate resources appropriately, and ensure compliance with all applicable financial reporting regulations. 

Grant and Donor Requirements 

Many grantors, particularly government agencies and private foundations, require audited financial statements as part of the grant application or renewal process. Meeting these expectations can position your organization for continued funding and demonstrate sound fiscal stewardship. 

Board or Bylaw Provisions 

Some Not-For-Profits choose to include audit requirements in their bylaws or internal policies. This proactive approach encourages consistent oversight and builds trust with stakeholders and community partners. 

 

Preparing for a Successful Audit 

A successful audit starts long before auditors arrive. By maintaining strong financial practices throughout the year, your organization can minimize stress and ensure a smooth process. 

Keep Records Organized 

Accurate, up-to-date financial records are essential. Maintain clear documentation for all transactions—receipts, invoices, payroll records, grant agreements, and bank reconciliations. Organized records allow auditors to verify information quickly and efficiently. 

Evaluate Internal Controls 

Strong internal controls protect your organization from errors and misuse of funds. Review your approval processes, segregation of duties, and documentation practices regularly to ensure they remain effective. 

Communicate Early and Often 

Reach out to your auditor early in the year to discuss timelines, expectations, and any changes in operations or funding. Clear communication prevents surprises and helps both parties stay aligned throughout the process. 

Track Grant and Program Compliance 

Maintain detailed records of how grant funds are used and ensure that all reporting requirements are met. Compliance documentation not only satisfies funders but also demonstrates your organization’s commitment to transparency and accountability. 

 

Building a Culture of Accountability 

Compliance isn’t just about passing an audit—it’s about building an organizational culture that values accuracy, transparency, and responsibility. Regular policy reviews, staff training, and active board engagement can help your Not-For-Profit organization stay compliant and resilient. 

When accountability becomes part of your culture, your organization is better equipped to adapt to evolving regulations and continue delivering on its mission. 

 

How De Boer, Baumann & Company Can Help 

At De Boer, Baumann & Company, we understand the challenges and opportunities that come with running a Not-For-Profit organization. Our dedicated team provides audit and assurance services designed specifically for the Not-For-Profit sector, combining technical expertise with a deep appreciation for mission-driven work. 

From preparing for your next audit to strengthening internal controls and meeting compliance standards, we partner with you to build confidence in your financial management practices—so you can focus on what truly matters: serving your community and advancing your mission. 

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Rethinking Expectations for Nonprofit Board Members

Nonprofit boards play a critical role in guiding organizations, but unrealistic expectations for volunteers can create challenges. Excessive pressure around high-level giving and fundraising often results in boards dominated by donors who may lack the expertise, time, or capacity to govern effectively. This dynamic can discourage qualified individuals from joining or continuing to serve, …

Nonprofit boards play a critical role in guiding organizations, but unrealistic expectations for volunteers can create challenges. Excessive pressure around high-level giving and fundraising often results in boards dominated by donors who may lack the expertise, time, or capacity to govern effectively. This dynamic can discourage qualified individuals from joining or continuing to serve, ultimately affecting the organization’s stability and impact.

Key Responsibilities of Nonprofit Boards
While responsibilities can vary, nonprofit boards are generally tasked with ensuring legal compliance, sound governance, and mission fulfillment. The National Center for Nonprofit Boards identifies ten core duties:

  1. Define the organization’s mission and purpose.

  2. Select and evaluate the executive director.

  3. Support the executive director while reviewing performance.

  4. Ensure effective organizational planning.

  5. Secure adequate resources.

  6. Manage resources responsibly.

  7. Oversee programs and services.

  8. Enhance the organization’s public image.

  9. Serve as a court of appeal when necessary.

  10. Assess board performance.

Other experts highlight additional practices that help boards function effectively, including maintaining regular meetings and communication, documenting decisions, establishing committees, providing ongoing education, and ensuring diversity and representation.

Balancing Realistic Expectations
Despite extensive guidance, the sheer volume of responsibilities can overwhelm volunteer board members. Advocates like Vu Le and Michael Bobbitt have questioned traditional board structures, suggesting more inclusive and flexible models that reflect the community and reduce unnecessary burdens, such as mandatory financial contributions.

However, many experts emphasize that boards remain essential. Anne Wallestad, former CEO of BoardSource, notes that boards help nonprofits:

  • Maintain public trust through shared accountability.

  • Ensure strong organizational leadership.

  • Navigate CEO transitions effectively.

 

Amy Eisenstein, CEO of Capital Campaign Pro, recommends practical, realistic expectations for board members, including:

  • Making personal contributions.

  • Sharing professional networks.

  • Advocating for the organization.

  • Encouraging others to contribute.

  • Expressing gratitude to supporters.

  • Actively participating in meetings.

 

By setting achievable expectations, nonprofits can attract a more diverse and engaged board, improve governance, and foster long-term public trust. While donors are vital, balancing fundraising with effective board leadership helps create a stronger, healthier nonprofit sector.

At DBC, our nonprofit specialists assist organizations in structuring boards and governance practices that promote engagement, accountability, and sustainable impact.

To read the original article by Timothy McClimon, please visit Forbes.

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How Recurring Gifts from Donor-Advised Funds Can Strengthen Your Nonprofit

Recurring gifts are increasingly recognized as a critical component of sustainable fundraising. Donor-advised fund (DAF) participants who set up recurring grants in 2024 — whether automatically or manually elected each year — contributed more than three times the amount of donors making one-time donations. This reliable support helps nonprofits maintain programs and plan for …

Recurring gifts are increasingly recognized as a critical component of sustainable fundraising. Donor-advised fund (DAF) participants who set up recurring grants in 2024 — whether automatically or manually elected each year — contributed more than three times the amount of donors making one-time donations. This reliable support helps nonprofits maintain programs and plan for the future, even during periods that traditionally see lower giving.

The Advantages of Automatic Recurring Gifts
Automatic recurring contributions provide dependable revenue streams that can smooth out seasonal fluctuations in donations. For example, research found that automatic gifts accounted for 25% of contributions during July 2024, a month typically associated with lower giving.

Beyond the financial benefit, recurring donors often become more engaged with the organizations they support. They are more likely to volunteer, interact with board members, attend events, and, on average, increase their donations by 8% annually.

Encouraging Donors to Choose Automatic Giving
Despite these benefits, many recurring gifts are still manually scheduled. According to Vanguard Charitable, only 24% of recurring gifts are automatic, while the remainder are set manually by the donor. Frequency preferences vary: 50% of recurring grants are annual, 20% monthly, 19% quarterly, and 11% twice per year. Younger or less-wealthy philanthropists often favor monthly contributions.

Nonprofits can guide donors by clearly communicating their preferred timing and frequency. Because DAF grants are not tied to traditional year-end deadlines, organizations have the flexibility to request contributions throughout the year.

Building a Stronger Revenue Foundation
Incorporating recurring giving into your fundraising strategy strengthens financial stability while deepening donor relationships. Encouraging both automatic and manual recurring contributions helps create a more predictable revenue base and fosters long-term engagement with supporters.

At DBC, our nonprofit specialists work with organizations to design and implement recurring giving strategies that maximize donor impact and provide sustained support for your mission.

To read the original article, visit The NonProfit Times and the research from Vanguard Charitable.

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Four Ways to Engage the Next Generation of Donors

Successful nonprofits strike a balance between honoring long-time supporters and engaging new donors. Loyal contributors have sustained your mission and fueled meaningful impact over the years — but securing the future of your organization also requires reaching the next generation of givers. Generational change is constant: while new potential donors are entering adulthood every …

Successful nonprofits strike a balance between honoring long-time supporters and engaging new donors. Loyal contributors have sustained your mission and fueled meaningful impact over the years — but securing the future of your organization also requires reaching the next generation of givers.

Generational change is constant: while new potential donors are entering adulthood every day, long-time supporters will eventually step back. The challenge for nonprofits is twofold — maintaining strong relationships with current donors while cultivating the next wave of philanthropists.

Here are four strategies to help your organization attract and retain younger donors:

1. Analyze Your Data to Understand Younger Supporters
Many nonprofits are surprised to discover that younger donors often respond to traditional outreach — just not in traditional ways. For example, a direct mail campaign may prompt a younger recipient to visit your website and donate online rather than sending a check by mail. Without tracking this cross-channel behavior, these gifts may go unnoticed, leading to the mistaken belief that younger audiences aren’t engaging.

By using integrated data analysis across mail, digital, and other channels, nonprofits can more accurately measure results and make informed decisions about how to reach younger donors. The right analytics partner can help identify multi-channel giving trends and create acquisition strategies that appeal to younger audiences without losing sight of older donor preferences.

2. Explore New Outreach Channels
To reach younger demographics, nonprofits should consider expanding beyond traditional mail and phone campaigns. Alternative channels can include:

  • Face-to-face fundraising: Street campaigns and in-person events can be particularly effective, often leading to recurring gifts from supporters in their 30s and 40s.

  • Text messaging: Broadcast fundraising texts can achieve high engagement rates with younger audiences, generating click-through rates as high as 30–40%.

  • Connected TV (CTV): Many individuals under 50 no longer subscribe to cable, but they still stream video content. CTV campaigns can deliver mission-focused messages, build awareness, and drive donations among younger viewers.

3. Broaden Your Data Sources
Many organizations rely heavily on transactional history — such as years of giving and number of gifts — to guide their outreach. While this is useful, it can unintentionally favor older donors who have longer giving histories.

To identify and attract younger supporters, nonprofits should blend transactional data with other behavioral and demographic insights. AI-powered modeling can incorporate thousands of variables, providing a more complete picture of potential donors’ values, interests, and giving potential — regardless of age or donation history.

4. Build Awareness Before Asking for Support
Donating is rarely the first interaction someone has with a nonprofit. Younger audiences often need to connect with your mission in meaningful ways before making a financial commitment. That means starting with awareness-driven marketing campaigns and engaging them with relatable, accessible entry points.

Examples include social media influencer partnerships, mission-related challenges, or downloadable resources tied to your cause. These initiatives can generate qualified leads and build trust, paving the way for long-term donor relationships.

The Bottom Line
Connecting with younger donors doesn’t mean replacing your current supporters — it means building a broader, more resilient community. By applying data-driven insights, diversifying outreach channels, and building awareness early, nonprofits can inspire a new generation to give while continuing to honor and serve those who already do.

At DBC, our nonprofit specialists understand the unique challenges of fundraising in a changing donor landscape. We work with organizations to develop strategies that attract, retain, and engage supporters of all ages. 

To read the full article “4 Ideas for Finding Your Next Generation of Donors” by Greg Fox, please visit 4 Ideas For Finding Your Next Generation Of Donors – The NonProfit Times

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Donor Receipt Letters: A Guide for Not-for-Profit Organizations

When a donor contributes to your not-for-profit organization, they’re making an investment in your mission. A well-crafted donation receipt not only ensures that your donors can claim their tax deduction but also serves as an opportunity to express gratitude and reinforce their commitment to your cause. In this blog, we’ll walk through the essential …

When a donor contributes to your not-for-profit organization, they’re making an investment in your mission. A well-crafted donation receipt not only ensures that your donors can claim their tax deduction but also serves as an opportunity to express gratitude and reinforce their commitment to your cause.

In this blog, we’ll walk through the essential elements of a proper donation receipt and how you can make the most of this important communication tool.

Why Are Donation Receipts Important?

A donation receipt is more than just a formality, it’s a requirement for donors who wish to claim a tax deduction for their charitable contribution. The IRS has specific guidelines on what must be included in a valid donation receipt, and failing to comply can create challenges for both your organization and your donors.

To ensure compliance and strengthen donor relationships, every receipt should include the following elements:

The 4 Key Requirements for a Donation Receipt

1. Name of the Organization

This one is straightforward- your organization’s name must be clearly stated on the receipt. The easiest way to do this is by printing the receipt on your not-for-profit organization’s official letterhead. If you don’t have letterhead, simply including the organization’s name in the body of the letter will suffice.

2. Date the Donation Was Received

The donation receipt must include the date the contribution was made. This is critical because receipts need to be contemporaneous, meaning they should be issued around the same time as the donation. This ensures donors can use the receipt when filing their taxes for the corresponding year. The date can be included in the letterhead or within the body of the letter.

3. Type of Contribution

Not-for-profit organizations receive both cash and non-cash contributions, and the donation receipt must specify which type was received.

· For cash contributions: The letter should state the exact amount donated.

· For non-cash contributions: The receipt should include a description of the item(s) donated but should not assign a dollar value. It is up to the donor to determine the fair market value of their donation for tax purposes.

4. Statement Regarding Goods or Services Provided

This is an essential part of the receipt, as it clarifies how much of the contribution is tax-deductible. There are three possible statements to include:

· Option 1: No goods or services were provided. Used when a donor gives purely out of generosity without receiving anything in return.

· Option 2: A description and estimate of goods or services received. This is common for fundraising events where donors receive something of value in exchange for their donation. Example: If a fundraising dinner ticket costs $100 and the meal is valued at $25, the receipt should state that the value of goods provided was $25, making the tax-deductible portion $75.

· Option 3: Intangible religious benefits were provided. Used primarily by religious organizations to indicate that any benefits received were spiritual in nature rather than material goods or services.

Don’t Forget the Thank You!

While a donation receipt serves a practical purpose, it’s also a chance to reinforce the impact of your donor’s generosity. A simple thank you can go a long way in building lasting donor relationships. Acknowledge their contribution and express gratitude for their support. It makes a difference!

Summary: What to Include in a Donation Receipt

· Name of the Organization

· Date the Donation Was Received

· Type of Contribution

· Statement on Goods or Services Provided

· A Thank You

By ensuring your donation receipts include these elements, your not-for-profit organization will remain compliant with IRS guidelines while also maintaining positive and professional donor communications.

Looking for more not-for-profit organization financial guidance? Stay tuned for future blog posts, where we’ll share more examples and best practices to help your organization succeed!

At De Boer, Baumann & Company, we specialize in not-for-profit organization financial services and compliance. If you need assistance with donor receipts, tax regulations, or nonprofit accounting, we’re 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.