This may sound quite bizarre, but this evening I went through the envelopes containing checks sent in the fundraiser and processed and deposited most right before midnight (the rest were processed after I got back and will go to the bank tomorrow).
So it was really gratifying to see checks from readers whose names in many cases I recognized, as well as read the kind notes and cards (and some sent animal pix). Thanks so much for your vote of confidence in our work!
Now as to the bizarre part (as in why did it take me so long to actually take your money, or at least the money of the people who sent checks), it is certainly NOT because we won the lottery or have gotten a super rich secret benefactor. The big reason is I wanted to take the income in the same year I’d be spending it; otherwise more will get eaten up by taxes than needs to.* Last year, I was able to prepay a boatload of expenses, so I didn’t need to inconvenience readers. I won’t bore you with the details as to why, but on several fronts, it didn’t make sense to prepay some of the things I had paid in advance last year. So the cleanest solution was to hold off on taking some of the proceeds of the fundraiser till we rolled into the new year. I hope it hasn’t inconvenienced any of you; I did get some concerned e-mails from folks who had noticed their fundraiser checks had not cleared. They should in the next few days.
Thanks again for your generosity and support!
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*Readers have sometimes asked why I have not set up a not for profit. At my small scale of operation, the compliance costs would more than offset any tax savings. And I don’t just mean the accounting and reporting expenses, but the demands that form of organization would place on my already scarce time. I’m chronically overloaded as it is and having a not for profit would have me spending more time on administration and less on blogging.
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No worries Yves. Most of us readers long stopped paying our mortgages, so we no longer take the home interest deduction and itemize.
Oh, I’m so sorry! I didn’t mean to be insensitive.
If you run your own business, even if it’s a small one (and mine sadly has always been small), there seems to be an unavoidable level of cost and complexity, no matter how simple you try to keep it. And that includes thinking about the tax man.
Congratulations, Yves, on resisting suggestions to set up a non-profit. The last thing we need is another corporation! Again, many thanks for your tireless efforts to inform, educate, and interact with your readers. You are doing a remarkable job!
I finally settled on working with a “fiduciary agent” in order to get my 501(c)3 status. Basically, I give 10% of any donations to the sponsoring non-profit and they take care of all accounting, tax paperwork, etc. Really, it’s just a dedicated checking account for my project (community elementary school in Nepal) through their organization. We have a free bicycle shop in town that started life this way as well.
Glad the fundraiser went well.
Yves, I am sorry to be the bearer of bad news but a cash basis taxpayer must include income when received, so holding a check for several days will not have any tax effect: the checks belong to 2012, not 2013. If you’d like more info or need any help I am happy to help you.