PTO Today

OMG! I am so glad someone posted about this!

I am totally confused.
Our principal has told our new PTO Team that we have to close our PTO account and that all of our money has to go through the school's bookkeeper.

Is this what this bill says to do?
That is how she has interpreted it and so far, no one on the PTO Team has argued anything about it, they are just doing as she says.

We also were told by the principal that this bill prevents us from using tax-free status anymore and now we have to charge sales tax on everything the PTO sells.

This will definitely force a lot of informally structured PTOs, band boosters, etc. to figure out exactly what they are. Are they an independent organization or an extension of the school? Many are in between where they consider themselves "independent" but are not legally structured as such.

First - the district has to set policies and all orgs need to follow those policies. A key requirement is:

[I]Recognized [U]school support groups[/U] must provide a copy of its by laws and [B]proof of recognition as a nonprofit organization[/B] before initiating support, assistance or raising money.[/I]

The district will have to determine what "proof" they want. But if you are a 501(c)(3) PTO, this is easy. You are definitely independent; you keep your own money and run your own show (subject to district guidelines). And it was NEVER legal for you to use the school's tax ID number - so you continue not to do that because you have your own.

If you are a parent group that's been operating off radar, now you are really in limbo. Either you don't exist as far as the school is concerned or you are really just a volunteer/fundraising committee for the school under control of the principal. Much like chess club, cheerleaders, swimteam or any other school organization/club. They have some autonomy, pursue their own programs, have fundraisers - but all as part of the school and monies must be deposited in the school's Activity Account. (Note - funds are still earmarked for the particular group, but final control is the the principals.)

No more grey area. Either you are independent or you are part of the school. So the questions are:

1) What ARE you now? Independent non-profit or not?
2) What are the districts new policies?
3) What proof or recognition do they require for you to be considered a non-profit?

Good luck and keep us posted.