Who 990 Schedule Rome 2023-2024

Welcome to my series of video tutorials on how to prepare Form 990-EZ information return for small tax-exempt organizations. I'm David McCree, a CPA, and you can find me on the web at myform990-ez.com. In this video, I'm going to talk about net assets. You can think of net assets as similar to retained earnings if you're familiar with that concept. If you're not, don't worry about it. So, net assets, as we discussed in our earlier videos, is simply what happens if an organization sells or liquidates everything it owns, pays off all of its liabilities (credit card balances, loans, mortgages, etc.), and then whatever is left over is the net assets. Net assets are calculated by subtracting liabilities from assets. Your net assets increase with income and decrease with expenses. Now, let's take a look at the first page of Form 990-EZ because there are two places where you'll have to deal with net assets, and they always need to match. If you scroll down, you'll see the revenue and expenses, and then you'll come across a section called net assets. Line 18 is where your net profit or loss goes. You subtract your total expenses from your total income. Line 19 represents your total net assets at the beginning of the year. You add your profit and loss to that, and line 21 shows your net assets at the end of the year. This information appears on the first page of the return. On the balance sheet, you'll find that line 27 is also net assets. Your total assets minus your liabilities equals your net assets. It's important to note that net assets on line 21 must always equal net assets on line 27. There's only one net assets, divided into beginning and ending net assets. Now,...