From time to time, we share previous content that has enduring significance for nonprofit organizations. The following blog post was originally published on 8/29/18 and has been lightly refreshed.
Thinking about year-end already? It may still feel like summer in many parts of the country, but December 31st will be here before you know it! Here are ten things you can do now get a head start on the busiest season of the year.
(And remember - although many nonprofits have a fiscal year that ends on June 30 or another date other than December 31, tasks like filing 1099s and W-2s must still be completed according to the IRS's calendar-year schedule. So don't delay!)
Review your vendor records and make sure you have all necessary W-9 forms on file. If you do not have a vendor’s tax information, reach out to them now to request a new or updated W-9.
Set up a template to collect vendor data for 1099-MISC forms and begin drafting any known 1099s. Although you cannot finalize your 1099s after year-end, there is only a limited window to file these important forms (a deadline of January 31st for nonemployee compensation). So it’s best to do as much as you can ahead of time!
Review your internal controls and look at ways to reduce your risk of fraud or honest mistakes. There are many simple things nonprofits can do to improve financial controls. By putting new systems into place now, you’ll be prepared for the busy months ahead.
Maintain a current and complete list of donors and contributions. Update this list frequently and regularly, rather than waiting until the end of the year.
If your organization receives grant funding, review the conditions of your grants and all reporting requirements and deadlines. Keep a clear calendar of all important dates so nothing slips through the cracks in the year-end rush.
Analyze last year’s budget and think about how you can improve or adjust for the coming year. Keep both short-term and long-term goals in mind, and don’t forget to budget for in-kind contributions too.
Begin gathering data and brainstorming ideas for your annual report. Keep a running list of all the milestones and accomplishments you might want to highlight in your annual report.
Remind staff to review their withholdings and confirm their information is correct. Double-check names, addresses, and social security numbers so there are no hiccups when you’re ready to file W-2s.
All staff – including management – should be evaluated regularly on their job performance. If your organization pays out year-end bonuses, you’ll want to begin the evaluation process well in advance.
Assign year-end responsibilities now, so everyone is on the same page before the busy holiday season. There’s nothing like a last-minute moment of, “Wait…I thought you were doing that!” to put a crimp in your plans.
The new year may still seem a long way away, but why put off until tomorrow what you can do today? By starting your preparation process now, you can put yourself in a good position to tackle year-end tasks with a minimum of stress.