There is no charge for your EIN/TIN number. The rest of the fees for the 501c3 ($500.00) & incorporation fees (in Michigan it's $20.00) come from your pto budget. We are starting this process also...getting out from under the schools ein#. Good luck!
Yes, a parent group can use the same tax id # as the school IF:
1. The school approves
2. The parent group understands that by using the same tax id #, the group's money is actually owned by the school, not by the parent group.
While the school may graciously allow the parents to raise and manage the money, if the money is held in a bank account under the school's tax id #, the money technically belongs to the school. Thus, the school should be responsible for auditing the account and reporting the group's money as part of the school's annual IRS return. The school might also hold the checkbook and dictate fundraising and spending restrictions.
Many parent groups operate happily under the school's oversight. In fact, it might be the best model for a new parent group, a very small group, or one with very little parent leadership. It works best when the parent group and school admin have a good working relationship. But the potential risk is that the school spends "your" money without the group's approval. In this model, the parent group is a like a committee of the school, similar to student council or chess club, rather than a separate entity from the school.
In time, your group might grow to a point where the parents want more control of the group's activities and finances. Then you might want to consider separating from the school and becoming a federally-registered 501c3 like many PTO's (but certainly not all).
There's loads of questions and responses about tax-exempt, 501c3, and non-profit on this message board. Grab a fresh cup of coffee and search...you can learn alot just from reading prior posts.
Ok, I am trying to get this tax-expemt thing straight....
Can a PTO and a school use the SAME Tax ID #?? (We are a very small school, and don't raise too many thousands as I read other schools do!)
thanks!
Got news today that our school DID get a tax ID# and will allow us to use it. But now that we've started down this road, and considering how much money we are bringing in - both my VP and I think we should go the 501c3 route and have our own tax ID#, etc. It's going to be a fight, and I really don't know why our treasurer is so deadset against it. But in the long run, I really think it's the right thing to do for the group. And I'll just have to have faith that people won't jump ship. And I'll have to be on the lookout for a new treasurer too I guess! Hate to have it come to that, but this really should have been done a long time ago.
