Few points for bookkeeping on non Profits.

Significant aspects of taxation for Non profits

Approval of IRS

The income of Non profit entity is exempt from Federal Income tax if it is approved by IRS.

Taxability of Donation received

Donation received by Non Profit is exempt and no tax is payable on same.

Sales tax and State level taxes

Non Profits are required to pay sales tax and other taxes based on state-level requirements.

Employment Tax

Non Profits are required to pay employment tax even when they are exempt under the federal income tax.

Accounting for donations received

Unrestricted contribution revenues

If the purpose of contribution received is not stated by a donor, it would go to unrestricted contribution revenues.

Temporarily restricted net assets

If the use of the donation is specifically stated it would go under temporarily restricted net assets

Permanently restricted net assets

These donations are such which can never be used in perpetuity at any point in time.