Nonprofit sector recovering from recession

March 17, 2014

Nonprofit sector recovering from recession

The time could be perfect for many nonprofits to re-evaluate their obligation to state UI tax pools. Nonprofit HR has announced a recent survey that suggests organizations are recovering from The Great Recession. The survey found 45 percent of nonprofits increased staff in 2013, compared to just more than 19 percent in 2009, at the height of the recession.

In 2014, more than 20 percent of nonprofits intend to increase hiring and only 7 percent plan to eliminate positions. Because unemployment at these organizations will remain low, it is a good time for leaders to consider making their nonprofit a self-reimbursing employer.

Cost savings with less risk
As a self-reimbursing employer, an organization can opt out of paying into state UI tax pools and pay the state only for the amount of UI costs actually associated with claims paid out to former employees. The only downside is that when unemployment spikes at an organization, there is no pool to help pay the costs. This can lead to a large amount of unfunded liabilities and force a nonprofit to reduce programs.

However, nonprofits can get the cost benefits of self-reimbursement without the risk by gaining membership in a nonprofit savings program. These alternative measures for meeting UI obligations allow nonprofits to protect their assets by building up funding in an account that they own. It can be used to pay for increases in unemployment and is returned to the nonprofit if they ever leave the program.

Organizations also gain access to experts in the UI industry that have a unique understanding of the specific challenges faced by the nonprofits they serve. UI insurance programs for nonprofits are the best way to save money but also remain prepared should another recession suddenly hit.

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.firstnonprofitgroup.com.

single-post12182

Ready to chat?
Get in touch today to request a no-obligation savings evaluation.

Testimonials

Working with Marshal Whittey at First Nonprofit has been a great experience. He handles our request as a priority and goes above and beyond to resolve any issues we have in a timely manner. Marshall follows through to the end and ensures our needs are met. He has been a great resource for LSC and our “go to” for any tax questions we may have. With LSC transitioning several facilities into one federal tax identification number, First Nonprofit was able to assist and provide guidance with best practices resolving claims to each entity. Additionally First Nonprofit provided knowledge (information materials) and one on one training to HRS group with best practices to handle claims state adjudicated, fraudulent claims, and appeals. And processing information in the First Nonprofit [unemployment claims] system allows for timely information can be collected.

Lutheran Services Carolinas, Salisbury, NC

My experience with FNP has been wonderful. Unemployment in general is quite confusing and FNP has simplified the process for us. Everyone we have reached out to or worked with has been very helpful and follows up to be sure we understand the information. I am so happy we made the switch to FNP!

Stone Valley Community Charter School, Huntingdon, PA

First Nonprofit smoothed the unemployment perils for our organization during Covid. Without the ability to cap our UI exposure, we would not have been able to weather the storm. The program worked perfectly and we have come out of the pandemic ready to forge on. Thanks FNP!

Jewish Silicon Valley, Los Gatos, CA

My experience with the FNP has been fantastic. The idea of setting funds aside for the unemployment tax liability is a bedrock for nonprofit organizations like mine, namely ASHBA; what is even more advantageous is having the FNP as a custodian of those funds. 100% recommended!

American Saddlebred Horse & Breeders Association, Inc., Lexington, KY

I would like to comment on my experience with FNP….to date our District has saved $1,000’s of dollars by being enrolled in the First Nonprofit program. My only regret is that we did not know about this method of paying unemployment tax years ago….as I had figured about five years

ago, had we enrolled 15-20 years ago, we could have saved our small school district upwards of $500,000 in payments to IDES. Also we would have had a pretty hefty sum of money in our Reserve Account. Thankfully I attended a workshop hosted by First Nonprofit back in 2015 which got the ball rolling!

Beardstown Community Unit School District 15, Beardstown, IL

I have worked with the First Non-Profit Team for many years, and I appreciate the quick response and care that Cecilia and the team provides anytime I have questions. While there are other providers that may provide like services, First Nonprofit will always be my first choice! I appreciate you!

Innovative Services, Inc., Green Bay, WI

First Nonprofit has been easy to work with and makes the administrative process easier and smoother. We enjoy working with you.

Visually Impaired Preschool Services, Louisville, KY

Luckily for us, our interactions regarding any issues with staffing has been very minimal! I can say that all other interactions with regards to billing, 941 reporting, etc. have been extremely pleasant, accommodating and easy to work with. Kim Ghanayem is always prompt, professional and friendly. Thank you so much!

Neurologic Music Therapy Services of Arizona, Phoenix, AZ