Is there a limit on the amount of money you can raise if you are a non-profit organization? I am someone tell me tonight that you can only raise a certain amount of money if you are non-profit and to be truthful this is the first time that I have heard that. I have searched the web and can't find out this information. Thanks for you help.

I don't think so. Look at the United Way or Jerry's Kids. They raise millions.

I don't think there's a limit to how much you can raise. Our PTA raised about $8,000 last year doing one fundraiser. Our problem was trying to deposit all the money into our checking account. The bank charges you a tax (?) when you deposit more than $10,000 at the same time.

Hope this helped.

There are 2 different issues. One involves being a non-profit (at the state level), the other involves being tax-exempt (at the federal level).

You'll need to check your state law as to state levied taxes like sales tax. Here in Texas, as a non-profit, we can are exempt from sales tax on two calendar days per year. (But if it's something like a 3 week product sale - the whole amount is rolled into the 1 collection date.) So we might have a catalog sale in the Fall and a carnival in the Spring. Most everything else from our fundraising is subject to state sales tax.

At the federal level, the status is called "tax exempt". From what I've read, the amount doesn't seem to be an issue as long as it's related to your core mission/business activities. But note, there are some things that might affect a PTO. For example, advertising for a directory or newsletter that exceeds $1000 is considered "Unrelated Business Income (UBI)". That has to be reported as such and is subject to federal taxes. Other than that, it just seems the reporting requirements may get more complex as your gross amount hit certain levels like $25,000; $100,000, $1,000,000.

[This message has been edited by JHB (edited 01-21-2001).]

Taxes become much more complicated for a nonprofit if you carry a balance of more than $25,000 from one fiscal year to the next, but you can get around that by planning ahead and having a projected budget for the coming year before you file taxes.

I've not encountered anything about the BALANCE being an issue, just gross receipts during the PTO's fiscal year. Maybe I just didn't pay attention, as our policy is to spend down to about a $3000 balance at the end of each school year. However, if we were working on a long-term plan, like a playground, we could easily be carrying forward larger amounts.

Could you elaborate on what you meant? I'd appreciate any information.


[This message has been edited by JHB (edited 01-24-2001).]