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Does the PTO need to file a tax return?

15 years 1 month ago #129925 by TAX ADVICE NEEDED PLEASE
Replied by TAX ADVICE NEEDED PLEASE on topic RE: Does the PTO need to file a tax return?
It sounds like that school never formed their own PTO and filed for their own Federal EIN number. Which is fine. Our district has 5 elementary schools and each have their own. However, in a meeting with the district's auditor, she said that its easier if we all file under one EIN, but have our own school records seperately under that EIN. (Kind of how the large corporations work their subdivisions of smaller companies.)
It's no problem for you to hold money for them and then pay the bills as long as you set up a separate line item for them on your budget. Deposit the money under that line item (ABC school) and all expenses paid are under that line item, ABC school. Have the new item created during a meeting so it is on record and all requests for bills be done via form signed by that school representative.
You then have your paper trail and record of the budget changes.
15 years 1 month ago #129960 by mum24kids
I disagree with WFS here. If they are saying that they need it deposited to a 501(c)3, then I think they're in a situation where they have a donor who wants to deduct this $3k as a charitable contribution. Since the preschool is not a 501(c)3, they wouldn't be able to provide the donor with the documentation he needs to deduct this.

I doubt they're trying to avoid paying taxes; they probably just weren't smart enough to set themselves up as a charitable organization.

The $75,000 donation from last year is huge!!!! Your group must have had the responsibility to send a thank you letter to whomever it came from, right? Your PTO should have included that on your tax return, along with all the expenses. I don't know what your annual budget is (excluding all this non-affiliated preschool stuff), but taking in all that money when it presumably had nothing to do with your organization's charitable mission is the type of thing that could jeopardize a group's exempt status. What this group is doing isn't illegal, but it could cause major problems for your group.
15 years 1 month ago #129982 by JHB
The question from Allys5 regarding playground funds is also running as a separate thread (Help!). Why don't we share any responses there and not take this one off on a tangent? It's really easier for everyone to have a question/discussion in one specific place.
2 years 11 months ago #173105 by Anonymous
Replied by Anonymous on topic Does the PTO need to file a tax return?
I am part of a PTO that has obviously filed an AOI with the state because they have there own EIN number on the PTO’s bank account. I don’t know if the PTO ever filed a 1023ez with the IRS to obtain an501(c)(3) status. Even if they did, the PTO has not filed the 990n form with the IRS for the past 3 years, so the status has lapsed. Therefore, we have established ourself as a corporation with the state, not sure if we are incorporated or not, and we have not been filing a tax return. We are a small PTO, at most we’ve only ever accumulated 15,000. I am assuming we are considered a for profit PTO? Do we need to file? What does that involve? How much?
2 years 11 months ago #173114 by Liz L
You can get your status reinstated with another filing fee and by completing Form 990-EZ for the years you did not complete the forms. Here's a helpful IRS link about reinstatement that will hopefully help:

Good luck.
Liz from PTO Today
2 years 11 months ago #173117 by gjcoram
The first PTO I joined had twice gotten an EIN from the IRS (and had filed Articles of Incorporation with the state), but had never filed Form 1023 (nor any 990n/ez). The people at the IRS non-profits help line were always very friendly and helpful. I filed 3 back years of 990ez; we appealed the fines for late filing; and we filed Form 1023 and got our 501(c)(3) status.
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