Question: Fundraising limits?

Are there limits on the number of fundraisers a PTO can have within a school year where taxes don't have to be paid? Also, can PTO activities that generate money throughout the year be considered donations (i.e.: spirit table selling school logo items)?

Asked by Kristen



Advice from PTO Today

Craig writes:
There's no limit in a legal sense on how many fundraisers you can run. However, we strongly recommend that you limit your group to no more than two or three major fundraisers a year. At some point, parents get fundraising fatigue and your returns will go down drastically. You'll work harder to make less money. Also, if parents perceive your group as doing nothing more than a fundraising organization, you'll have a very difficult time attracting members and volunteers. On the other hand, if you focus on building involvement first, you will do better in your fundraising. The reason is that the more connected people feel to a group, the more likely they are to support it financially. Regarding donations, the most important thing to know is that donations are only tax deductible if your group is registered with the IRS as an official 501c3 charity. If you are a 501c3, your supporters aren't allowed to deduct payments for which they expect something of fairly equal value in return (like buying a school logo T-shirt).

Community Advice

Kristen writes:
Tennessee law for a 501c3 states after 2 fundraisers we would have to pay taxes. We hold only 2 fundaisers a year because of this law. However, we have logo items we want to sell throughout the year. Do we pay taxes on these items? I'm not sure I understand your answer above. Thank you for claifying.

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