Q&A

donation

we are in the infancy of reforming a pto at our local school the prior EIN# that was used by the organization is still active with the IRS. We are in the process of writing a new set of bylaws, but have be approached by a company about a donation to get us started. Can we accept this?
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You can accept it, but you cannot tell them that the contribution is tax deductible unless the IRS recognizes you as a 501(c)(3) organization. Some companies write off this type of thing as a marketing expense, so they are not going to care about tax deductibility anyway. I think most companies require that you be a 501(c)(3) organization before they donate just so they know you are somewhat legitimate, not because they are looking for a charitable deduction. If this company is willing to give it to you, take it!
- mum24kids
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Thank you for the response. We are trying to proceed but we not have any support from the admin all the way to the director of schools. I have meet with the principle and still feel that the lack of support is there. We want to be more of teacher support group and not fundraisers for the school. Our school is a community school with a high level of free and reduced lunches. We just want a core group of parents that will work along side the faculty, staff and community to provide the best learning enviroment possible. BTW if we have less than 5k in gross receipts per year the is form 1023 necessary?
- ZDL
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If you have less than $5k in gross receipts, no--the Form 1023 is not necessary. But unless you go through the process and formally get approved as a 501(c)(3), people won't be able to deduct their donations to you, either. So, you need to weigh the importance of that against the cost of filing. You might also call the IRS and double check this answer with them.
- mum24kids
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