The Black Nonprofits and Business Podcast · K. Holmes

When Your Nonprofit or Business Needs A CPA

·1 hr·5 clips

Cherie reveals that gifting over $16,000 requires filing a tax return, even if you don't owe taxes.

This episode of the Black Nonprofits and Business Podcast features host Kimberly Holmes in conversation with CPA Cherie Raquel, founder of Little CPA, who specializes in nonprofit accounting and high-net-worth estate planning. Holmes frames the discussion as essential for Black-led organizations and business owners navigating financial complexity. Raquel explains her work in tax compliance, planning, and consulting for nonprofits, estates, trusts, and gifts. She clarifies that "high net worth" typically refers to individuals with over a million dollars in assets, while "ultra high net worth" often starts around five million. Raquel details estate and gift taxes, noting the 2022 estate tax exemption was $12.06 million per individual, with a top tax rate of 40%. She explains that gifting over $16,000 to one person in a year requires filing a gift tax return, though tax is only owed if lifetime gifts exceed the multi-million-dollar exemption. The CPA designation involves broad business education, not just tax expertise, and Raquel states CPAs often gain tax specialization through work experience and continued education. She distinguishes CPAs, who are trained as business advisors, from enrolled agents, who are IRS-designated tax experts, and from certified financial planners, who focus on personal finance. Raquel advises that nonprofits always need accounting systems and should hire a bookkeeper or CPA once they reach about 30-100 transactions monthly. Using Black Lives Matter as a case study, she notes the organization grew rapidly to multi-million-dollar donations without adequate staffing or infrastructure, like sufficient paid employees. Raquel points out that paying a founder's family member six figures for services, while potentially legitimate, creates compliance risks regarding "private benefit" rules for nonprofits. She states that having a nonprofit attorney and CPA early could have guided better structural decisions. Raquel adds that Black Lives Matter initially operated correctly under a fiscal sponsor, which is a good model for young organizations before filing for independent 501(c)(3) status. She recommends business owners inform their CPA of any significant financial event, like starting an LLC, ideally before taking action for proactive tax planning. The tone is educational and conversational, blending technical explanations with practical advice for the Black entrepreneurial and nonprofit community. This episode is ideal for Black nonprofit leaders, business owners, and aspiring entrepreneurs seeking to understand complex taxes and avoid financial pitfalls. Listeners solely interested in basic personal finance or those seeking entertainment-focused content might find the detailed tax explanations too niche.

As heard by us

A plainspoken look at when fast growth calls for stronger accounting support.

The Black Nonprofits and Business Podcast keeps the focus where it belongs: on what happens when money moves faster than the organization built to track it.

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Why you'd press play

You want to know when growth means it is time to call a CPA.

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