January 24, 2014
Marla Esan, Senior Manager, Tax & Business Services, Quoted in Long Island Business News Article, "New State Laws Revamp NY's Nonprofit Sector"
By Claude Solnik
Modernizing antiquated regulations, easing financial burdens and approving new technological protocols are among the functions of new state laws targeting nonprofit organizations.
As of this coming July, the New York Nonprofit Revitalization Act of 2013 will take some bold steps – including higher thresholds where mandatory audits kick in, new rules allowing board members to meet via conference call and video and overhauled conflict-of-interest and merger policies – with the ultimate goal of attracting new not-for-profit groups to New York.
There’s more at stake here than saving nonprofit organizations some money. For instance, a cash-strapped state government can get more mileage out of its nonprofit funding if recipient organizations spend less on regulation compliance and more on service.
In what is potentially the biggest money saver in the new package of laws, the threshold at which nonprofit audits are required doubles from $250,000 to $500,000 in annual revenue. And it won’t stop there: The threshold increases to $750,000 in July 2017 and to $1 million in 2021.
The threshold for mandatory reviews – less costly financial examinations – increases from $100,000 to $250,000 this summer.
“This is a relief for small charities especially,” said Marla Esan, senior manager in Marcum’s Tax and Businesses Service Group in Melville. “Many will begin to fall under the threshold to obtain an independent audit.”
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