You are here:

Nonprofit Law/Volunteer time as a non cash asset on balance sheet

Advertisement


Question
I am the Director of Development and a board member for a small non profit that is building its net worth. I volunteer 100% of my time, often 60 hours a week. I keep good records of my hours. I heard somewhere that my time can be reported as a non cash asset on our balance sheet to increase the asset base of our 501(c)3.  This would be helpful as we apply for grants and funding is based on net worth.  Can you tell me if this is true and where I would find this information in the IRS.

Answer
I never heard that volunteer hours could be accounted, in any reasonable accounting system, as an asset.  I have read that the value of the hours may be reported in the Form 990 series, though.

In the instructions to Form 990-EZ we see in the discussion of line
1 (Revenue) they have, "Reporting line 1 amounts in accordance with
SFAS 116 (ASC 958), Accounting for Contributions Received and
Contributions Made, generally is acceptable (though not required)
for Form 990 and Form 990-EZ purposes, but the value of donated
services or use of materials, equipment, or facilities may not be
reported. However, state law may require it."
http://goo.gl/txPKU

and further down, "Do not include the value of services donated to
the organization (such as the value of donated advertising space or
broadcast air time), or of the free use of property (materials,
equipment, or facilities) as contributions on line 1. However, for
the optional reporting of those amounts, see the instructions for
donated services in Part III."
http://goo.gl/zkHcy

The discussion about that in Part III is at:
http://goo.gl/Y7O0o:
--- Start of Excerpt ---
  The organization can report the amount of any donated services, or use of materials, equipment, or facilities it received or utilized for a specific program service.
      Disclose the applicable amounts of any donated services, etc., on the lines for the narrative description of the appropriate program service.
      Do not include these amounts in the expense column in Part III.

---End of Excerpt---
Harvey Mechanic, Attorney at Law -
Harvey108@hotmail.com

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.  

Nonprofit Law

All Answers


Answers by Expert:


Ask Experts

Volunteer


Harvey Mechanic

Expertise

I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at Harvey108@hotmail.com I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "site:allexperts.com/q/nonprofit" without the quotes and then add your search terms before hitting enter.

Experience

I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.

Education/Credentials

B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.


©2016 About.com. All rights reserved.