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PTSO Auction, do we need to pay taxes?

7 years 6 months ago #165801 by Jen P.
Hi,

Our PTSO had an auction this year comprised of donated items by businesses and members. Do we have to report this income to the IRS and pay taxes on it? We are getting conflicting answers and we want to air on the side of caution.

As a note, we had to pay in advance for a couple of the items. Great wolf lodge donated a package worth $400, but we had to give them $200 for it. Would we have to pay on that?

Thanks!
7 years 6 months ago #165849 by Rose H
Hi,

If your group is a 501c(3), it has non-profit status and is exempt from taxes. Instead, you would file a Form 990, which is looking for a statement of income/expenses.

Rose C.
7 years 5 months ago #165919 by Roger.Devine
You may, however, be responsible for collecting and reporting sales tax - this varies by state.

Let's see if I can put a link in here, to an explanation of the rules in Texas - this is an excellent example of how wacky the rules can be:

www.auctionhoustontexas.com/info/charity...ndraising-sales-tax/

(NOTE: that link does not go to my business, and is not intended to be a commercial post.)

So - check with your state treasurer.

Roger
7 years 4 months ago #165995 by FoxMom
I would contact your state government and see what their rules are- each state seems to be different on their games/raffle rules. We usually file a reconciliation form that shows income/expenses--- and it's due within 30 days of the event.... I would check to make sure what the rules are for your area.
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