October 17, 2013
Throughout the country, nonprofits have seen increased fees and reductions in tax credits as governmental bodies struggle to balance budgets following the recession. Nonprofits in Chicago, Illinois and the nearby suburb of Downer's Grove are seeing fees related to water usage for the first time.
Downer's Grove instituted a utility fee to pay for stormwater in place of property taxes, so tax exempt nonprofits are feeling the burden of a new bill. While the village is floating plans to reduce the rate for local nonprofits, they will still be required to pay the fee. In Chicago, nonprofits are dealing with the loss of an exemption from water payments that some organizations claim will affect the services they offer. The city and nonprofits are still discussing a resolution, including a graduated fee based on a nonprofit's net assets.
As nonprofits deal with the loss of tax exemptions or immunity to other fees they find themselves coping with new expenses. For some nonprofits, these fees are coming at a time when funding and revenue have already suffered.
Nonprofits have options to UI tax
While nonprofits and governmental bodies continue to iron out future fees and tax exemptions, nonprofits do have an alternative when it comes to avoiding UI tax. Nonprofits and governmental organizations can opt out of state UI tax and its pooled trust funds under tax law that allows such entities to reimburse the state only for the amount specifically paid to former employees. Private employers pay a set rate each year which is often much greater than the actual amount of reimbursements.
Just as some local governments have started to levy new fees on nonprofits, states have been forced to raise UI tax contributions on employers to pay back federal debt incurred during the recession. Some states borrowed from the federal government to pay UI claims, which spiked during the recession, and did not pay the loan back within the two-year time limit. In states with UI debt to the fed that is over two years old, federal mandates will raise the employer contribution to state UI tax pools every year until the debt is paid back.
For information on how your organization can cost-effectively meet its unemployment insurance needs, contact First Nonprofit Companies at FNCUI@firstnonprofit.com or visit www.firstnonprofitcompanies.com.
First Nonprofit has saved us so much money over the state’s program. We had one little glitch with the state recently and we contacted FNP immediately. FNP staff called us back immediately and moved to remedy the problem.
First Nonprofit has been a great partner. They have helped us saved hundreds of thousands of dollars! They have awesome resources for our nonprofit organization. Thanks for the partnership.
Life is certainly busy these days but having business partners like First Nonprofit has made some of the process hassle free. We have worked with this team for years. When we changed payroll systems, they outlined every step. I think this team is terrific and I know they get the job done! Thank you, Cruz, to all the team at FNP.
FNP has helped our agency to save thousands of dollars every year on our unemployment coverage. The service is phenomenal, and we are thankful to their team as our partner. My experience working with Marshall on the advocacy around UE for nonprofits was also a highlight as someone who teaches advocacy and lobbying for nonprofits. Really, your whole team is top shelf, so thank YOU!
Chicago Children’s Theatre has greatly benefited from our partnership with First Nonprofit, and I have always enjoyed working with the staff on our filings and any complicated questions. I would not hesitate to recommend First Nonprofit to fellow nonprofits. We’re very happy customers.
FNP is a great resource for Daniel Kids. To have a TPA that we can count on to take point on not only managing our unemployment claims, but to support and guide any protest hearing, is invaluable. All the professional support staff we have worked with have been excellent, very knowledgeable and responsive. We are grateful for the help and support, thank you.
When I first began in my position at my organization, I hadn’t had experience working with a company like FNP. The staff was so patient and helpful in helping to explain the benefits of First Nonprofit. Anytime I reach out with a question I receive a quick, clear, and thorough response. I’m so thankful that we decided to partner with FNP. Their excellence in customer service, coupled with their variety of packages frees us up to truly serve our staff and community with a peace of mind knowing that our organization is protected against unanticipated unemployment insurance expenses.
First Nonprofit gets an A+ in my book. You are so easy to work with & very knowledgeable! Whether it is my quarterly correspondence with Kim or my random interactions with Dawn about a bond … I am so pleased that I get to work with such a helpful company. Thank you!