Print
Interesting question. I'm going to draw a distinction between nonprofit and tax-exempt. Nonprofit means you don't distribute money to shareholders, as for-profit corporations do. In other words, as a nonprofit, all of your money is invested back into the business. A for-profit business, on the other hand, has "owners" who are entitled to take the profits as personal income. It's hard to picture a PTO operating like that. To be tax-exempt, you must be nonprofit and you must also apply for tax-exempt status from the IRS. (Most tax-exempt PTOs are 501c3 charities.) I'm not sure whether your group would be eligible, since it's goal is to aid a for-profit corporation. I'd recommend speaking with an accountant or attorney experienced in working with nonprofits to set up a structure that works best for your situation.
- Craig
Links in this post: