Business Formation, Not-for-Profit, Tax-Exempt Status

Self Employed but Not-for-Profit

A nonprofit organization is organized like a corporation to do work that benefits the public. The organization can receive both state and federal tax-exempt status. The business files a form 1023 with the IRS for recognition of exemption under Section 501(c)(3) of the IRS code and registers with their state. A fee applies to the application.

Tax-Exempt Purposes

The exempted purposes are set forth in Section 501(c)(3) of the Internal Revenue Code and include:

  • charity (relief of the poor, the distressed, or the underprivileged);
  • advancement of education or science;
  • testing for public safety;
  • fostering national or international amateur sports competitions;
  • preventing cruelty to children or animals,
  • advancement of religion;
  • advancement of literary work;
  • erecting or maintaining public buildings, monuments, or works;
  • lessening the burdens of government;
  • lessening neighborhood tensions;
  • eliminating prejudice and discrimination;
  • defending human and civil rights secured by law; and
  • combating community deterioration and juvenile delinquency.

Staying Exempt

Most tax-exempt organizations other than churches are required to file an annual information return or notice with the IRS.  Organizations that fail to file for 3 consecutive years automatically lose their tax-exempt status. A nonprofit organization can also jeopardize its exempt status by participating in nonexempt activities as listed on the IRS website “How to Stay Exempt;”

New Frontier Tax and Business Services can help you with your start-up activities, tax planning, bookkeeping, and payroll.  Give Pam or Robb a call at 785-594-1204 or send an e-mail to

Business Formation, Self employed

Self Employed: Step #1 Structure

In case you haven’t noticed, new businesses have been sprouting around Baldwin City, filling the older buildings with brand new enterprises and livening up the downtown sidewalks and brick roads. Every new business faces the same initial question, “what business structure will I take?”  The business structure you choose influences everything about how you do business. You can find these classifications spelled out on the IRS website and listed here.

Sole Proprietor or Partnership
Perhaps you are a sole proprietor, a person who owns an unincorporated business by himself or herself.  Or, you may choose to establish a partnership, which is a business relationship between two or more persons who expect to share the profits and losses of the business venture in predetermined percentages and pass through these gains and losses to their personal tax returns.


You may want to incorporate your business, which means you form a taxable entity and exchange money or property or both for the corporation’s capital stock. The S corporation is a form of corporation that passes through its gains and losses to its shareholders. Only certain corporations can be S corporations.

Limited Liability Corporation (LLC)

You can also form an LLC according to the laws of the state you operate in unless your business is a bank or insurance company. According to the small business administration (SBA), LLCs protect you from personal liability.  In most instances, your personal assets—like your vehicle, house, and savings accounts—won’t be at risk in case your LLC faces bankruptcy or lawsuits.

An LLC is treated by the IRS for tax purposes as either a partnership that passes through income and losses to its members (owners) or as a corporation and is a taxable entity.  An LLC can have only one owner (a single member) in most cases and is treated by the IRS, for tax purposes, as an entity not separate from the individual owner.

New Frontier Tax and Business Services can help you with your start-up activities, tax planning, bookkeeping, and payroll.  Give Pam or Robb a call at 785-594-1204 or send an e-mail to

New Frontier Tax and Business Services can help you with your tax planning, bookkeeping, and payroll.  Give Pam or Robb a call at 785-594-1204 or e-mail

Filing System, Self employed, W-4

Sigh of Relief and Then … Start Planning For 2019 Taxes

Many of our customers are both employed and self-employed, painting a tax picture that reveals itself slowly as incomes, deductions, and taxes paid are added and subtracted from a variety of the tax forms.  If you just finished your 2018 taxes, this is a good time to review how well your business and employment worked together to pay your 2018 tax bill.

Personal: Review your W-4

On the personal side, review your W-4 form with the payroll or human resources manager at your place of employment.  The W-4 is the form you fill out that tells your employer how much tax to withhold from your paycheck.  Did you pay too much and receive a big refund or pay too little and owe a lot, perhaps even having to pay fines for underestimating?  The taxes withheld from your paycheck reflect your filing status (single, married, head of household) and the dependents you claim.  Check to make sure the information on your W-4 form is accurate.

Business: Set up a Paper and an Electronic Filing System

On the business side, make yourself a filing system so you can organize your receipts and invoices in folders or envelopes if your receipts are paper and in computer files and folders if your receipts and invoices are electronic.  Most likely you will need both paper and electronic files. Determine the categories your business expenses and income usually fall into and make folders and files that are named accordingly. Things like fuel, feed, seed, pesticide, replacement animals, veterinarian bills, equipment repairs and maintenance, and new equipment purchases are common expenses in a farming business. Check to see that your online folders are named the same as your paper files and then use that same name to enter the expenses in your Excel table or quick books program.

Track and File Weekly or Monthly

File and enter your expenses weekly or monthly to avoid the pain of finding yourself in February of 2020 sorting stacks of receipts at the kitchen table for tax year 2019. You are bound to miss something and spend a lot of time searching for missing receipts.

New Frontier Tax and Business Services can help you with your tax planning, bookkeeping, and payroll.  Give Pam or Robb a call at 785-594-1204 or e-mail


Thank You!

Welcome to our new blog. Here, we plan to stay in touch and share information and news.

Thank You!

As most of you know by now, New Frontier has moved to 810 High Street in Baldwin City.  In the new Baldwin City Business Center, we have more room to work in and more parking for our customers.  This move is an upgrade, largely due to a successful couple of years that we are grateful for.  Thank you for being our customers, for bringing us your tax, bookkeeping, and payroll business.  We will continue to provide affordable, accurate, and local service with a smile. It is our hope your business and personal endeavors flourish in 2019.