PTO Today

I am the treasurer of a new PTO in NJ. I have obtained an EIN number, but when I went to open a bank account for our group, I was told that we have to provide proof of non-profit status. We decided at this time not to apply for 501c3 because of the cost nor are we incorporating for the same reasons. If any one can give any advice or assistance I would be extremely grateful.

For-profit businesses can open bank accounts, so why exactly does the bank need that proof?

I think you should look more closely at the idea of incorporating; I don't think it's very expensive, and it allows you to get insurance to cover the group -- rather than having any lawsuits directed at you and your personal assets.

You should be able to open a regular business account but you will not be consider "not for profit" so if there are any fees etcetera that might be waived due to that status--you'd have to pay them. That's the only thing I can think of.
d

I have heard others discus how people's personal SSN had to be used. Since you have the EIN maybe that won't be the case, but I think the overall belief is that you would want to stay away from this if possible.

You should just make sure beforehand.

Also, I would 100% recommend filing for the 501(C)3 status. Yes there will be the one time cost, but it is most definitely worth it. If you need to run some form of extra fundraiser to do so then that is what I would recommend.

Good luck,
PresidentJim

Absolutely do not use a personal SSN for this. It's not a personal bank account.

Is there a different bank in town that you can try?

I agree with Jim on filing for 501c3. There are some grants that you aren't even eligible for if you're not 501c3. You should at least read through the requirements -- I think you have 27 months from incorporation to file Form 1023 -- and make sure you keep financial records sufficient for filing next year, if the group decides to file later.

You must be existance for at least 2 years before you apply for 501(c)3 status. Another opition is to apply under another organizations umbrella, if you have that option. It's not expensive but just very tedious and time consuming. I would suggest getting in touch with the Center for Non-Profit in New Brunswick for assistance. They have non-profit lawyers on staff to help you negotiate the forms.
Don't use anyone's social sec#. Find a different bank. EIN numbers are all you need.

I think you may be confused. I don't believe there is any waiting period; nor would you want to delay 2 years to get the benefits of 501(c)(3) status. The fee to apply is $750 and the paperwork is definitely tedious - but it's also doable. Many of us that participate in the Forums haves slogged our way through it.

As far as getting under someone else's umbrella - that mostly means either becoming a PTA unit or acting more as a school committee than an independent parent group. That latter model can work successfully if everyone's on the same page - but many fear risking their independence. Beyond those scenarios, there aren't too many opportunities to fall under someone else.

Can someone point me to where the best place is to file for non-profit status. Our PTO wants to, but haven't found the documentation needed to start the process. We are located in PA. Thanks!

Internal Revenue Service

You need Form 1023.

Try another bank. As someone else suggested, there are usually different (and more favorable) fee structures for non-profits than there are for for-profit corporations--that's probably why they are looking for documentation. Larger banks tend to be more picky about documentation. Or, you may just have had a person who didn't know what they were talking about. I've opened accounts for "unincorporated associations" before that are very small and/or new, and after explaining the situation, not had a problem opening an account under the non-profit terms.