Starting a Nonprofit
What is the first step in starting a nonprofit?
Define your mission and vision
What is the purpose of a general ledger?
To record all financial transactions
Which form is used for the annual return of organizations exempt from income tax?
Form 990
What is the role of the president of the board?
To lead and oversee the board's activities
What is another name for the Statement of Financial Position?
Balance Sheet
Which IRS form must be filed to apply for tax-exempt status?
Form 1023
Name one type of journal a nonprofit should maintain.
Cash receipts journal or cash disbursements journal
What is the form number for the short version of the nonprofit tax return?
Form 990-EZ
Name one key skill that is beneficial for a board treasurer to have.
Financial management or accounting
What financial statement shows the nonprofit's income and expenses?
Statement of Activities or Income Statement
What document outlines the rules for operating your nonprofit?
Bylaws
What financial record is used to track employee wages?
Payroll records
What is the filing requirement for small nonprofits with gross receipts of $50,000 or less?
Form 990-N (e-Postcard)
What is a primary responsibility of the board of directors?
Governance and oversight of the nonprofit
Which financial statement tracks cash inflows and outflows?
Statement of Cash Flows
What type of status allows donors to make tax-deductible contributions?
501(c)(3) status
What type of bookkeeping involves recording transactions when they occur, regardless of cash flow?
Accrual basis bookkeeping
Which form is filed if a nonprofit has unrelated business income?
Form 990-T
What type of member typically has legal expertise on a nonprofit board?
Legal advisor or attorney
What statement details the costs of various functional areas within a nonprofit?
Statement of Functional Expenses
Name one key state authority with which you must register your nonprofit.
Secretary of State
What document should be kept to track all financial transactions related to fundraising events?
Fundraising event log or record
What must a nonprofit maintain to prove its tax-exempt status to donors and the IRS?
Determination letter from the IRS
How often should a nonprofit board meet to ensure effective governance?
At least quarterly
Why is it important for a nonprofit to prepare regular financial statements?
For transparency, accountability, and financial management