NFP pro: When it comes to donors, focus on individuals

Written on Apr 20, 2017

By Jessica Salerno, OSCPA content manager

As trusted advisers for their clients, CPAs and accountants can give advice on a wide range of financial topics, including how to manage donations to nonprofits.

Egan“If I’m someone who has a philanthropic bend, and I go to my accountant and say ‘I want to give to an organization. How do I know what kind of charity is good?’ What’s the answer to that?” asked Patricia Egan, principal at Beyond Fundraising, LLC. “As an accountant or CPA how would you answer that?”

Egan will present Funding in Uncertain Times on June 20 at the Cleveland Not for Profit Conference. She will discuss what funding is like today for nonprofits and share tips on how to successfully raise money. For starters, nonprofits should target individual donors.

Egan said about 85% of funding comes from individual donors, a figure that has held steady for decades. A more specific group to look at for potential donors is people with IRAs.

“Focus on people who might have IRAs they need to spend down,” she said. “The government has made that a permanent tax-free initiative so people who want to give a gift can give it directly from their IRA to the charity and take the charitable contribution.”

Donors today are looking to make an impact with their dollars, and Egan said that’s where accountants and CPAs are in a unique position to help their clients. Egan said she uses the word “investment” when it comes to discussing donations because it’s not just throwing money at a cause, it’s an investment in the organization and its mission.

“You don’t want to give to an organization that’s going to fold,” she said. “You don’t want to have planned giving to an organization that doesn’t have staying power.”

When checking to see if an organization is financially sound, she suggested first going to and then to the organization’s form 990. She also encouraged CPAs to ask questions about programs offered, how much money management makes, what the funding resources are and how reliant the organization is on government funding.

“It really behooves donors to know if it’s an organization that’s on steady ground or an organization that has consistently struggled financially and why,” she said. “They need to be able to sift through all of those things to help make good financial decisions, and accountants can help them do that.”

Learn more about OSCPA’s Not-For-Profit Conference

Cleveland | June 20

Columbus | June 27

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