Tax Tips for Higher Education

ISSUE:

Filers of Form 990 must report any loans, receivables, or payables to O/D/T/KE/HCE/DQ’s on Schedule L, Part II.

SITUATION:

Saltwater Christian College (SCC) is a private college exempt under Internal Revenue Code section 501(c)(3) and section 170(b)(1)(A)(ii).  While we are working with them to complete their Form 990, SCC’s Controller tells us that they have a “travel advance” (made under an accountable reimbursement plan) that has been outstanding to the President at year end for 20 days.  She inquires about the question at Form 990, Part IV, Line 26 and wonders if this question should be answered “Yes” and the advance reported on Schedule L, Part II.  Form 990, Part IV, Line 26 asks:

ISSUE:

A new phone scam is on the loose whereby fraudsters – sometimes using automated phone calls – are attempting to extort by fear.

SITUATION:

Marathon Bible College (MBC) is a private college exempt under Internal Revenue Code section 501(c)(3) and section 170(b)(1)(A)(ii).  Their CFO sent us the following email this week…

ISSUE:

Historically, colleges have not paid income taxes on “royalties” received for sales of shirts, mugs, etc. containing their logo.  Might that change?

SITUATION:

Denali Christian College (DCC) is a private college exempt under Internal Revenue Code section 501(c)(3) and section 170(b)(1)(A)(ii).  Their CFO heard that proposals for tax reform might create a UBIT issue for DCC with regard to their “deal” with a vendor whereby they receive royalties from sales of items and apparel that contain their logo – Go Kodiaks!

Issue: The IRS has become increasingly persnickety about donation receipts – and the verbiage therein.

Contributions to your institution of works of art could be the “gift that keeps on giving” – in more ways than one.