Funny Mathematickin'

Probably one of the greatest personal stresses to me right now is the giant quagmire of a grant application that we've been working on for a month. With this application and the business taxes we file in May come the biggest dogfight of my job: trying to explain to Director/Buddy that just because we're a nonprofit it doesn't mean we have to end the year with a zero balance.

I'm not sure why she thinks that. But whenever I try to explain it, I get the "I'm right on this. I've been doing this for 15 years." Or something like that. Nevermind my own business experience and my own economics degree. I get sent back to fudge the numbers and move money around so that it looks like we spent it all.

It simply isn't true.

The IRS lets you carry a substantial balance over to the next year. Universities do it with "endowments" all the time. As long as you maintain the activities that make you tax exempt, you're fine. Without any money at year's end, you can never grow. Nonprofit just means you don't have a line item that says "profit". It means you reinvest the leftover into either an endowment fund or to expand programming. It doesn't mean you don't have any money.

I managed to win the fight about reporting our true numbers on our tax returns last year, and I plan on winning that fight this year, too. I have some clout on this, because if I buck up and don't do the taxes, then she has to, which will never happen. So I get my way. The first year I had to report our taxes, she made me make it come out to zero balance, which I didn't think was right, but I said "Oh, well, maybe there's something I don't know," and went from there. Last year, I said "Oh, hell, no," and did it the right way. When we had our outside financial review, I was only a few pennies off, which felt incredibly good. And legal. If I'd fudged the numbers, we'd have been fucked during our review.

But I can't win the fight in reporting the budget on this particular grant, because it funds our salaries, and it's too close to her heart to screw with. I rationalize it by saying that since it's technically a projected profit and loss statement, it's "imaginary" anyway, so who cares what the balance is at the end of the year, as long as it isn't negative. What difference does it make?

I don't even know if it's worth hunting down the relevant legal mumbo-jumbo to prove it.

At times like these, I feel like I've outgrown the place. I'm not sure where the next step is, and I'm not quite sure I'm ready to take it yet, but I sort of think I'm almost done.

-- Virgil