Financial / Fiscal Years and How They Impact You

Following is a transcript of this podcast episode, with audio/video below.

Welcome to the Two-Minute Treasurer’s Tip Podcast. I’m your host, Cyndi Meuchel, co-owner of MoneyMinder, where we are hoping to make your volunteer life easier.

Today I’m answering the following question: What is a financial year? Stacy writes, “I’m a new treasurer and I keep hearing about our financial year. What is this? Is it important and how does it impact my role as a treasurer?”.

So a financial year is the period that’s used to identify your tax year. It’s…it’s the time that you’re going to be reporting to the IRS on, if you need to do that. It’s also sometimes referred to as a “fiscal year.” These two terms are used interchangeably. So when your organization was set up, your founding members would have created some official formation documents that they would have filed with the state and in those documents they would have identified a financial year to report on. So if you have access to your articles of incorporation, that’s where you’ll find that.

Your financial year will always start on the first of a month, so as opposed to say like the 12th or the 23rd. If you can’t find any documentation and you are registered with the IRS, just go to the IRS’s website and they have a search tool or search bar on their site. Type in “search for tax exempt organizations.” A big blue button is going to show up there, and that’s going to allow you to search for your group. You could also go to charitycheck101.org if you want to look up some information and you can also see your past tax returns there.

So knowing when your financial year starts, that’s super important because any tax exempt organization, so in other words, groups that are registered with the IRS, they’re going to need to file a version of what’s called the 990 every year. This is due on the 15th day of the fifth month following the end of your tax or financial year. So let’s say you have a July 1 financial year start. Your 990 would be due November 15th, but you’ll want to check and see which version you need to be submitting, if you do it all. Hopefully this answers your question, Stacey, and gives you a few places to turn for more information.

If you have a question you’d like answered, feel free to email me at [email protected]. My name is Cyndi Meuchel and this is your Two-Minute Treasurer’s Tip.

Listen to the Two Minute Treasurer’s Tip Podcast wherever you get your podcasts: Listen on YouTube | Listen on Spotify | Listen on Apple | Listen on Amazon | Listen on Audible