Is a Calendar Year-End Holding Your Non-Profit Back?

The timing of your fiscal year-end could impact your non-profit’s efficiency. Let’s explore the options.

Have you ever considered whether your non-profit’s fiscal year-end is truly serving your organization’s needs? While a calendar year-end is common, it may not always be the most effective choice. Here are a few important factors to think about:

Government Grants:

If your non-profit relies on government funding, aligning your fiscal year with the government’s (ending September 30th) could streamline your grant application and reporting processes. This alignment might simplify your workload and improve compliance.

State Deadlines:

A calendar year-end can create challenges when it comes to meeting state deadlines for annual reports. If your financial reports aren’t ready in time, you may find yourself requesting extensions each year, adding unnecessary stress. Adjusting your fiscal year-end could make compliance easier and more timely.

Audit Timing:

Auditors are often busiest at the end of the calendar year, which can lead to delays and higher costs for your non-profit. By selecting a different fiscal year-end, you could avoid this peak period and potentially reduce audit-related expenses.

Form 990 and Publication 78 Delays:

We frequently emphasize the importance of early or timely filing of Form 990. It’s worth noting that there is often a delay of a few week between when the tax return is filed, even electronically, and when it is processed. Additionally, there is another delay before the return is released on Publication 78 and made publicly available. For grant-seeking non-profits, filing late can push back compliance activities and potentially impact your opportunities.

Have You Given This Thought?

It might be worthwhile to reconsider whether a calendar year-end is the best fit for your non-profit. A different fiscal year-end could better align with your funding cycles, state requirements, and audit schedules.