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COMMON CENTS HANDBOOK FOR ALASKA PTA TREASURERS Version 2007.1 Alaska PTA is grateful to the North Carolina State PTA for allowing us to use their "Dollars and Sense for Treasurers – March 1998" as a guide in compiling this "Common Cents Handbook for Alaska PTA Treasurers". Other Sources of information were also found in previous versions of Alaska PTA financial handbooks, as well as National PTA's Money Matters. Please feel free to let us know how we can improve this handbook. Alaska PTA April 2005 ALASKA PTA PO BOX 201496 ANCHORAGE AK 99520 907-279-9345 OR 907-278-0085 TOLL FREE: 1-888-822-1699 FAX: 907-222-2401 E-MAIL: firstname.lastname@example.com or firstname.lastname@example.com http://www.alaskapta.org ii TABLE OF CONTENTS INTRODUCTION……………………………………………………………………………………….…1 FINANCIAL RESPONSIBILITIES OF A BOARD…………………………………………………1 PRINCIPALS OF BEING A GOOD TREASURER………………………………………………..2 RESPONSIBILITIES OF THE TREASURER……………………………………………………….2 UPON TAKING OFFICE……………………………………………………………………………2 MAINTAINING FINANCIAL CONTROL……………………………………………………….2 WORKING WITH THE MEMBERSHIP CHAIRMAN……………………………………….3 ONLINE MEMBERSHIP REPORTING…………………………………………………….4 MEMBERSHIP DUES REMITTANCE……………………………………………………..4 CONTENTS OF THE TREASURER'S FILE……………………………………………………5 KEEPING TRACK OF UNIT FINANCES (THE BOOKS)………………………………….5 TREASUER'S REPORTS…………………………………………………………………………..6 ONGOING RESPONSIBILITIES………………………………………………………………..6 FILING TAX FORMS……………………………………………………………………………….6 ANNUAL REPORT…………………………………………………………………………………..6 FISCAL YEAR………………………………………………………………………………….…….7 END OF FISCAL YEAR TREASURER RESPONSIBILITIES……………………..…....7 BUDGETS………………………………………………………………….……………………..….7 BUDGET PREPARATION PROCDURES……………………………………….………..8 HOW TO IMPLEMENT PLANS….………………………………………………………….9 COLLECTING BAD CHECKS………………………………………………………………………….9 CHECK REQUEST SLIPS………………………………………………………………………………9 CREDIT CARDS …………………………………………………………………………………………9 PTA FUNDS VS. SCHOOL FUNDS………………………………………………………………..10 RESTRICTED FUNDS……………………………………………………………………………….…11 THE AUDIT………………………………………………………………………………………………11 WHO CAN AUDIT…………………..…………….……………………………………….….12 PREPARATION………………………………………………………………………………….12 RESPONSIBILITIES……………………………………………………………………………12 WRITING CHECKS……………………………………………………………………………..12 AUDIT COMMITTEE PROCEDURE………………………………………………………..13 MISAPPROPRIATION OF FUNDS PROCEDURES……………………………………………14 PTA AND THE LAW- FEDERAL REQUIREMENTS…………………………………………..15 EMPLOYER IDENTIFICATION NUMBER (EIN)………………………………….……..15 FEDERAL TAX EXEMPTION……………………………………………………………..……16 H.U.G.S………………………………………………………………………………………………17 DISASSOCIATION FROM P.T.A……………………………………………………………..17 FILING FORM 990EZ /990 ……………………….………………………………………….17 FILING FORM 990-N (new)…………………………………………………………………..17 UNRELATED BUSINESS INCOME (UBI)…………………………………………………..18 UBI DEFINITION…………………………………………………………………………….19 UBI EXCEPTIONS………………………………………………….…………………………20 iii IRS AUDIT…………………………………………………………………………….…………….20 STATEMENT FOR RECIPIENTS OF MISC. INCOME (1099-MISC)………….…..20 GENERAL INFORMATION…………………………………………………………………….…….21 BULK MAILING PERMIT…………………………………………………………………….…..21 INSURANCE……………………………………………………………….……………….……….21 CONTRACTS…………………………………………………………………………………………22 CERTIFICATES OF DEPOSIT………………………………………………………………….22 SALES TAX………………………………………………………………………………….……....22 FOUNDERS DAY GIFT………………………………………………………….………….…...22 FUND-RAISING INFORMATION…………………………………………..………………..…...23 HOW MUCH FUND-RAISING SHOULD PTAs DO?……………………………..……..23 KINDS OF FUND-RAISERS………………………………….…………………………..……23 DEDUCTIBILITY OF CONTRIBUTIONS MADE TO PTAs……………………….…..23 GAMING……………………………………………………………………………………….…....24 COMMERCIAL CO-VENTURING……………………………..…………………………….……..24 COMMONLY ASKED QUESTION & ANSWERS……………………………………….……….26 APPENDICES………………………………………………………………………………….………….29 A Financial Timeline Alaska Local PTA Unit B AK PTA Treasurers Remittance Form C Sample Form SS-4 Application for Employer Identification Number D Sample AK PTA Letter of Authorization E Check Request Form F Individual Member Form for Online Membership Reporting G 1-10 AUDIT PACKET / PTA Financial Management/Audit Checklist H Sample Certificate of Insurance I RECORDS RETENTION SCHEDULE J 1-3 Sample Mini-Grant Form K 1-12 Form 990EZ/Schedule A Sample IRS Forms and Instructions (2003) L 1-5 Sample Reports – Basic - Budget - Ledger Sheets - Balance Sheet - Budget Compared to Actual M 1-5 SAMPLE ELEMENTARY PTA – Computerized (Quickbooks Software) - Account Listing - Budget - Balance Sheet - Profit and Loss Actual to Budget N Record of Receipts / Cash Count Form iv COMMON CENTS HANDBOOK FOR AK PTA TREASURERS INTRODUCTION Most of us are on a PTA board because we are interested in making life better for our children. To accomplish the goals of our PTA, we need people, time and money. The mission of a nonprofit organization is to provide a service or solve a problem. As long as it has enough money to continue its operations, it does not have to "make a profit." Nonprofit organizations still have to be accountable for their funds. Board members are sometimes called trustees because they maintain the trust of the public that the organization is being well managed. The PTA board is accountable to the public because money has come from donations by members of the public and other sources. All members of a PTA board, not just the treasurer, are equally responsible for financial management. Too often, board members assume that the treasurer takes care of the finances, so they don't have to worry about it. This may be because people are uncomfortable dealing with money. An important role of the treasurer is to make sure board members understand the difference in the role of the treasurer and the role of other board members in financial management of the association. Take the time to review the publications National PTA's Money Matters and Alaska PTA's Common Cents Handbook for Alaska PTA Treasurers, as well as the Alaska PTA bylaws and the National PTA bylaws. These will be very helpful in preparing you for undertaking your financial responsibilities and duties. THE BOARD MEMBER FINANCIAL RESPONSIBILITIES OF A BOARD It is the responsibility of An executive board has to handle, use and spend other people's money. Many of us do not feel comfortable spending our own money, all board members to let alone other people's. However, all members of the board are make sure that the PTA is accountable for the funds of the association. operated in a fiscally and legally sound manner. Everyone, not just the treasurer, needs to be aware of the financial This is a requirement of aspects of the association. All board members must read the treasurer's report, ask questions and be familiar with the association's the bylaws, and also of financial status so that they can make appropriate decisions. state and federal laws. When you become a board It is the responsibility of the treasurer to make sure all board member, you are obligated members take their financial obligations seriously. by law to conduct yourself PTAs are nonprofit associations. Nonprofit associations need money to operate. Because income and expenses don't always in a manner which will come in the right order, it is necessary to have some cash available. preserve and protect the In a nonprofit, it may be good management for income to exceed PTA unit. If you fail to expenses. It is permissible for PTAs to maintain a savings account. act in a reasonable, What a PTA (nonprofit) cannot do, and what separates it from a prudent and proper business, is to allow the excess ("profit") to benefit any individual. Members of the executive board manage the finances of the manner, you leave association but receive no personal monetary gain from any excess yourself open to criticism of funds. This is why it is important for all members of the board to be from peers and to aware of the finances of the association. potential personal liability for financial losses or mismanagement that occurs during your term as a board member. This is known as fiduciary responsibility. 1 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS PRINCIPLES OF BEING A GOOD 2. Become familiar with the duties as TREASURER outlined in the bylaws, this handbook and National PTA's Money Matters. • NEVER sign a blank check 3. If you are new to the position, meet • Two signatures are required on all with the previous Treasurer to checks. receive any introduction to your unit's • State and National portions of dues are books that you can. never recorded as unit income. 4. Meet with the audit committee and • NEVER deposit PTA funds in a personal review any recommendations the or school account or deposit non-PTA committee may have had. funds in the PTA account. 5. Verify that a new signature card has • NO checks should be written until the been properly completed. See that Executive Board and the general the new signatories on the account(s) membership approve the budget. have been voted on as authorized at • PTA funds must be kept separate from a Board of Directors meeting, and is school funds. reflected in the minutes. Secure a • Always issue a receipt for cash received. copy for the Treasurer's records. Two persons should always count any Check on the address that the bank monies received. statements will be sent to. 6. Two signatures are required on all • It is never a good policy to pay with cash. checks. The new treasurer and at If you must you must also get a receipt. least two other officers (president • PTA may not raise money for individuals and secretary or other officer) should or donate money to other groups or be authorized with the bank to sign organization ( although a PTA may bear checks. its share of the costs of a cooperative 7. Make sure the correct EIN number project) (Employer Identification Number) is • Assure complete and accurate record listed on the bank account. (Check keeping of all funds. with the Alaska PTA Office if you are • Conduct an audit of financial records at not sure.) least annually. 8. Check that your unit has current • Remember, children should never be officers and directors insurance, exploited or used as fundraisers bonding and liability. The Alaska PTA can furnish information on this. RESPONSIBILITIES OF THE TREASURER 9. Work with Finance or Budget Committee to develop a budget for The treasurer is the duly elected, legally the coming PTA year. responsible and authorized custodian of the PTA funds. MAINTAINING FINANCIAL CONTROL The treasurer should work closely with the president who bears the full responsibility for 1. The treasurer is the officer the total affairs of the PTA unit or council and responsible for the funds of a should have complete understanding of all unit/council. Any other officer or financial matters. chairman, including the president, who receives money at some time UPON TAKING OFFICE during the year should immediately count (with another person present) The books should be audited before you and receipt the money, give the accept them or write any checks. An audit money to the treasurer, and should should be conducted immediately following receive a receipt from the treasurer the end of the term of office. This may or may for the exact amount. not be in the same fiscal year. 1. Check files and records received from retiring treasurer. Ask for any missing records at once. Anytime money is turned in, both people should sign the receipt- the 2 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS person turning in the money and the and record on the check and stub the person receiving the money. See reason it is written. Appendix N – Record of Receipts/ Cash Count. 10. Never issue a blank check for an unspecified amount. 2. Never deposit any money except PTA money into a PTA account. 11. Never pay with cash. PTA funds must be kept separate from school funds. School funds are 12. Deposit all monies received for the public monies; PTA funds are private PTA in the PTA account as soon as monies. possible after receiving it. Never leave money in the school or 3. PTA may NOT raise money for someone's home. Always keep a individuals or donate money to other copy of the deposit slip for your groups or organizations (although a records. It is recommended that you PTA may bear its share of the costs list the amount received for each of a cooperative project). From time income item (i.e., dues donations, to time PTAs may find it necessary to fund-raisers, etc) separately on the join with other groups or deposit slip. organizations in a coalition for the betterment of children, (bond 13. Never deposit any PTA money in referendums, health fairs, support for anyone's personal account or in the public education, etc). Before joining school account. a coalition, verify the group's purpose with the Alaska PTA office. 14. Checks should NOT be written to the school or principal unless it is a 4. The treasurer may pay out NO budgeted item or for a purchase, money until it is authorized by the which was approved by the PTA adoption of the budget by the membership in the adoption of the Executive Board and the general budget. (Be sure you receive a membership. (Remember the funds receipt to protect the school, principal belong to the membership not the and yourself.) board and not the school.) The procedure is outlined in your bylaws. 15. Write checks only for items in the The treasurer could be personally budget. Any change in the budget, or responsible for repaying the PTA for purchase of major items not in the any unauthorized expenditures. budget, must be approved by the general membership at a regular or 5. Maintain an accounting system with specially called meeting. (This is an accurate record of the expenses called Amending the Budget.) and receipt transactions of the unit. Keep records up-to-date. Working with the Membership Chairman 6. Require that a check request slip be 1. Cooperate with the Membership completed by persons needing a Chairman and keep an accurate list check (Example in Appendix) of PTA membership. 7. Save canceled checks, paid bills, receipts and bank statements for annual audit. 2. Keep all State and National portions of dues recorded separate from local 8. Obtain a receipt for every invoice, funds. This money should not be purchase or other payment made by included as part of the unit's expense the PTA. funds or included in the budget; however, the National and State 9. Register every check in the portion of the dues received must be checkbook at the time it is written shown on the Treasurers Report as 3 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS they are received and when paid to form for use by local PTAs which includes the the Alaska PTA. required information. The easiest way to make sure you have all of the necessary 3. Send all State and National dues to information for this process is to use the form the Alaska PTA Office as soon as provided by National PTA (see Appendix F th possible before October 15 , send for an updated much easier to use sample of monthly or as often as possible by this form). th Dec. 15 , with final payment of dues due to the Alaska PTA office by To gain access to the Online st March 31 .. Membership Data Reporting system, you must have a user name and password. Call 4. Amount of dues: State dues are the Alaska PTA Office to get the information $4.00 per member; National dues are assigned to your local unit. Online Training $1.75 per member; total to be sent to for the OMDR is available from National PTA the State is $5.75 per member. The in the form of WEBINARS. The schedule and check should be made payable to the enrollment information is at Alaska PTA. https://ptaevents.webex.com/ptaevents/. 5. IMPORTANT: Dues must be in the Membership Dues Remittance th, State Office by October 15 With online membership data reporting, the th st December 15 , and March 31 . Use membership dues must be paid in an amount the Alaska PTA Treasurers that corresponds with the total membership Remittance Form (sample in entered into the database during the Appendix – can be downloaded off reporting period. AK PTA web site) to send in State and National portion of dues and The membership information should be Founder's Day gifts. When itemized, downloaded from the data base and only one check is necessary. accompany the check for payment of the state and national portion of the membership 6. If no dues are received from a unit by dues. Member information may be entered at st March 31 , the unit may be removed any time but the deadline for dues payments from the mailing list and placed in an remains unchanged. inactive status until dues are paid. PTA/PTSA are registered service In order to remain a "Healthy Unit in Good marks. To solicit memberships and Standing", dues payments must be sent to then fail to forward State and the Alaska PTA office on or before, October st National dues is an act of fraud. 15th, December 15th and March 31 . Online Membership Reporting Alaska PTA units began using the Online Membership Data Reporting system beginning April 1, 2005. All membership information must be entered into the database online at www.pta.org/omdr. In local units this is the responsibility of the CONTENTS OF THE TREASURER'S membership chairperson or in the event of no FILE membership person the official membership list becomes the responsibility of the 1. A copy of the PTA unit, council or secretary. Check you PTA Bylaws to see if district bylaws and standing rules, there is some other person designated to with section marked authorizing handle membership responsibilities. disbursements. Certain required information is 2. A copy of State and National bylaws. necessary to enter the member into the database. The National PTA has developed a 4 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS 3. A copy of the budget as adopted by the organization. Also keep a copy The Treasurer is responsible for maintaining of any amended budgets, and the the books and records of the PTA. The books minutes of the meeting where the include a check book, deposit slips and check budget or budget amendments were register or ledger which shows income (and approved. its source) and expenses (and the purpose). 4. Receipt book to acknowledge money It is from the books that the Treasurer gets received by the treasurer. the financial information needed to provide financial reports to the Unit, reconciling the 5. Checkbook to disburse funds as bank statement(s), comparison information authorized within the budget. for the budget process, and information for the audit and to fill out the Form 990EZ. 6. Treasurer's account book in which to keep the financial records of the There are ready-made books available which organization. (See Keeping Track of should suit your needs. These can be on Unit Finances, below). paper or computerized. 7. Permanent IRS tax information including the following: See the Appendix for sample ledger sheets • Federal Employer Identification (books by hand). Also in the Appendix is a Number (FEIN) or Employer set of financial reports done on the computer Identification Number (EIN) software package "Quickbooks" for SAMPLE • Copies of filed Form 990EZ and ELEMENTARY PTA. Included there is a other required IRS forms sample: Chart of Accounts 8. Copy of current certificate of Budget insurance. Balance Sheet Profit & Loss Actual vs. Budget (also 9. An up-to-date roster of the members known as a Financial Report or of the association. Treasurer's Report). See next column "TREASURERS REPORTS" 10. Copy of this handbook, National Plus more reports PTA's Money Matters, and a copy of the most current Audit Report, National PTA's Money Matters has sample including the Financial Management reports, also. Checklist that was filled out by last years Executive Board before handing the books over to the Audit Committee. 11. Ten years' file of audit reports (for historical purposes). TREASURER'S REPORTS The bylaws provide that the treasurer 12. Seven years' file of cash receipts and make a report regularly (usually at each petty cash records, bank deposits, meeting) to the members of the invoices and statements. Association. 13. General correspondence It is helpful to the membership to include a column showing the budgeted amounts 14. Three years' file of budgets, so that an easy comparison can be made including any amended budgets. with the actual figures. The report should: • Show the balance on hand at the beginning of the year and the last KEEPING TRACK OF UNIT FINANCES month or meeting. (THE BOOKS) 5 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS • List all receipts in Detail and total them. • Form 990EZ Short Form Return of • List all disbursements, itemized Organization Exempt from Income and totaled. Tax • End with balance on hand as of the report and file with the • FORM 990 Return of Organization secretary. A copy of the most Exempt from Income Tax recent bank statement should be attached to the secretary's copy of the report. The report, when See "Filing Form 990 / 990EZ / 990-N" on read or presented at a regular page 17. meeting, should not be adopted, but filed for audit. ANNUAL REPORT ONGOING RESPONSIBILITIES The Annual Report is presented at the conclusion of the fiscal year (check your 1. Prepare and give a treasurer's report bylaws). The Treasurer should prepare an at each meeting of the Executive Annual Financial Report that shows: board and general membership • All the actual income for the entire year. showing the amounts expended • All the actual expenses for the entire compared to the corresponding items year. in the budget. The budget/ Finance • The year's budgeted amounts. Committee should pay close • The variance between the actual amounts attention to these reports. and the budgeted 2. If any budget revisions are necessary This Annual Financial Report is very due to lower or higher income, important for several reasons: unexpected expenses or projects, the committee should make 1. It provides the PTA's audit committee recommendation for adjusting the with important information to help it budget. The amended budget must complete its task. be approved by the general 2. It provides the PTA leaders with an membership at a regular or special extremely good tool to evaluate the meeting by a two-thirds (2/3) majority actual performance of the PTA against vote unless otherwise noted in the the plan (the budget) that was unit/council bylaws. developed. 3. The adopted budget serves as a 3. It provides a valuable tool for developing financial guide for the year; it must be future budgets. amended by a vote of the general membership to allow for a change in the money situation. The annual report becomes official after an FILING TAX FORMS audit has been completed and the audit report is adopted at a regular meeting. Treasurers are responsible for filing any tax forms for the unit/council. Beginning with the FISCAL YEAR returns DUE in 2008, ALL tax exempt organizations are required to file an A fiscal year is a 12-month period determined informational return. That means every PTA in your bylaws. The end of this period is the in Alaska must fill out one of the following time to review the books, prepare the annual returns: report, get ready for the audit, and file Form 900EZ with the IRS. • FORM 990-N Electronic Notice (e- Postcard) for Tax Exempt Alaska PTA recommends that your fiscal year Organizations Not Required to file begin on July 1 and end on June 30 in order Form 990 or 990-EZ. to coincide with the school year and allow for end-of –the-year expenses. If your PTA 6 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS changes its fiscal year by amending the the PTAs yearly activity. The budget is a bylaws, be sure to inform the IRS by working document and probably will need to completing Form 1128. be amended from time to time during the year. The budget should include monies END OF FISCAL YEAR TREASURER necessary to operate the PTA, including the RESPONSIBILITIES summer months and the beginning expense of the new school year. The budget does not 1. Be sure all dues have been paid. If end at the end of the school year, nor upon st you missed the March 31 deadline the election of new officers, but at the end of and no dues are showing on the your PTA's fiscal year. State PTA books, your unit will be considered inactive. Being placed on What should be done with "left over" the inactive list jeopardizes your money? unit's tax-exempt status. If bylaws are current, the unit will be reinstated Funds not spent in one budget year should when dues are received in the state be held and included in the new budget. No office despite their lateness. This PTA board has the authority to write checks should be done prior to the end of the to the school, the principal, or for unbudgeted fiscal year. items to "clean out" the accounts. Every PTA should try and leave sufficient funds for start- 2. Balance the books in preparation for up expenses for the next year. the audit. There is no ruling from the IRS or PTA that limits the amount of money the PTA may 3. Be sure the bank statement agrees carry forward to the next budget year. with the balance in the treasurer's However, large sums should be placed into a books. savings account or CD earmarked for a specific purpose. 4. Prepare annual report covering your term of office, or fiscal year. Remember, the treasurer must account 5. Prepare any reports required by the for every penny received and spent by government (i.e., Form 990EZ). the PTA! 6. Obtain signature cards from the bank and prepare authorizations as Budget Preparation Procedures required by the bank so the new treasurer may draw on funds without The Budget/Finance Committee, composed delay once the audit is completed of the treasurer, president (past and present and the new budget adopted. if possible), ways and means chairman, and other interested board members, especially 7. Deliver the necessary books and those with experience in financial matters, records to the Auditor or Auditing should prepare a budget proposal for Committee. See list under AUDIT. consideration by the Executive Board. BUDGETS 1. The committee should study and compare past budgets and financial Important: The goals of your organization reports, noting the routine expenses determine your budget not the other way incurred every year. Consider the cost of around. proposed new programs and projects. Total these anticipated expenses. What is a budget? Estimate the amount of income the PTA A budget is a guide. It is a simple statement expects to receive. Adjust amounts in showing a plan for obtaining funds and the income and expense areas until they spending those funds to meet the needs of are equal and realistic. 7 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS business. This area should be sufficiently 2. Before including in the budget purchases detailed to include all major sources of of "big ticket" items such as playground income, but it is also helpful to include a equipment, air conditioning, office "Miscellaneous" or "Gifts" line for income equipment, items for the school's from unexpected sources. The other part technology program, etc., the PTA of your budget is "Expenditures". It should determine whether or not the should be broken down into three main proposed purchase or service is a public categories: "Operating Expenses", responsibility that should be paid out of "Annual Funding Items", and "Special public funds by the school system. Projects". Most importantly, is the purchase for the "Operating Expenses" are those benefit of all of the CHILDREN in the expenses required to run your PTA unit. school? They may include dues to councils, office supplies, telephone expenses, postage, 3. Prepare a balanced budget showing the and membership campaign expenses, sources of income (dues, donation, fund- expenses for items purchased for resale raisers, etc) and the allotment of in your fund-raisers or special sales, and expenditures for the year's activities. a small but adequate "discretionary Every amount of money to be received fund"-specified with guidelines- to handle and to be spent must be accounted for. unexpected operational expenses. Be realistic in your expectations of both Please note that fund-raisers must be income and expenses. The state and included in both the "Income portion of national portions of the dues (currently your budget (for all money received) and $5.75 total per person) do not belong to in your "Expenditures" portion to expend the unit and are never recorded as part of the funds for purchasing the items for local PTA income. In accordance with resale. the bylaws, this money MUST be sent to the Alaska PTA Office and, therefore, is "Annual funding Items" would include that not a budgetable item. Only the local your PTA regularly provides for your portion of the dues should be shown as school every year such as parent income. education programs, awards and certificates, Reflections, teacher Since all monies must be shown on the appreciation, scholarships, support for treasurer's financial report, the National students such as student council, safety and State portion of dues should be patrol, and school clubs, and support for shown as receipts and disbursements not yearly programs such as science fairs, belonging to the local unit. It is wrong not Black History Month, Red Ribbon Week. to report all income, from every source, on your financial reports- including dues "Special Projects" include items your PTA collected on behalf of your parent wishes to purchase for the school which organization. are on a one time basis or at least over a short term. These are usually high dollar 4. Be sure to include an adequate amount items such as playground equipment, of carryover funds to begin next year (to computers, furniture, etc. Before your cover start-up expenses and training of PTA considers one of these "special new officers before the new money starts projects," please make sure that the coming in.) benefit to all of the children in the school is clear and all other avenues of public 5. Setting up the Budget. A budget should funding for these items have been be divided into two main sections: exhausted. "Income" and "Expenditures". Of course, under the income you should list all dues Finally, your budget should include a line to your local unit (not state or national for carry-over to the following year to dues), all anticipated income from fund- ensure that funds are available for the raisers, gifts, special sales, etc., from next year's start-up. The budget should which your PTA plans to conduct be simple enough to be understood but 8 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS detailed enough to permit you to correctly bank regarding the status of the account and categorize all expenses. Most send the check through when sufficient funds importantly, with feedback from your are there. Many banks have automated membership, prioritize the needs of your phone lines you can use to check those bank students and the school and decide balances. The PTA always has the option of which projects will be most beneficial. filing a claim in small claims court or taking out a warrant. 7. Budget approval. The committee then submits the budget proposal to CHECK REQUEST SLIPS the Executive Board for approval; they have the option of changing it Units and councils are encouraged to use a before they approve it. The resulting general check request slip system for its budget is then submitted to the expenditures. A check request is a written general membership for adoption. authorization for expenditures (contained They may also adjust it before finally within the budget) after the executive accepting it. It takes a majority vote board/committee and the general to adopt the budget. membership votes to spend the money by approving the budget. 8. Amending the budget. Since the budget is only an estimate of the A check request may be written by the planned expenditures for the year, it person or committee chairman requesting the may be necessary, from time to time, money, then approved by the president, first to amend it. vice president or another designated person. The treasurer then writes checks for the When there are additional expenses or a purposes authorized by the check request. change in an allocated expenditure, the There should always be two people with the budget must be amended by a vote of the authority to approve expenditures since the association at any regular meeting or at a president should not approve his/her own special meeting called for that purpose. To request. See sample of form in Appendix. amend something previously adopted, it is necessary to have a two thirds (2/3) vote—a CREDIT CARDS majority vote—with previous notice having been given and a quorum established. With the use of debit and credit cards, there are new financial considerations for PTA HOW TO IMPLEMENT PLANS leaders. The treasurer shall make disbursements in Accepting Cards accordance with the approved budget; the Accepting debit or credit cards will cost you treasurer until authorized by the association fees; it may however make you more money cannot pay bills not included in the budget. in the long run. Your PTA Board will have to The treasurer should alert the research and decide if this option makes Budget/Finance committee and the Executive sense for your local PTA. Board if it appears that budget revisions may be needed for the effectiveness of the PTAs Setting Up work. In order to accept credit or debit cards you must set up a merchant account. This can be COLLECTING BAD CHECKS done by contacting your bank or, if they do not offer this service, a private credit card Unfortunately, PTA's occasionally receive clearing company. In some cases you will be bad checks from persons paying for fund- asked to provide authorization for a credit raising merchandise, etc. Every effort should check; this may be difficult if your be made to avoid this occurrence by knowing organization has no credit history. Do not use the persons writing the checks. If a check is an individual's credit information for the returned, make contact with the person who organization; it can complicate things when wrote the check and ask that sufficient funds people leave the position or if there is a be made available. If your first attempt is problem. unsuccessful, periodically check with the 9 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS authorized "check signers" puts in place a Costs safety net that reduces questionable Accepting cards costs money; there are set- transactions. up fees and transaction fees. Make sure you understand how these fees are calculated NOTE: PTA financial policy before you sign the agreement or contract. states that there are to be "2 signers" for checks. Credit There are several types of credit card cards and ATM or Debit cards machines. Manual machines are just that, the do not meet that requirement. credit card slip is filled out by hand and manually run through the machine to create an imprint. Slips are then processed, much PTA FUNDS VS. SCHOOL FUNDS like checks. Volunteers must be properly trained on this procedure in order to avoid PTA funds MUST be kept separate from mistakes and omissions which can cost your school funds. School funds are public PTA money. monies; PTA funds are private monies belonging to the local unit and its members. Electronic machines or "swipe" machines For the money generated at a fund-raising require a power outlet and a phone line. You activity held within a school, on school district may not always have these available during property or involving students who belong to fundraisers and programs. Some companies PTA to be considered PTA funds, the activity offer wireless options, they are however more at which the funds were raised must have expensive. been conducted at the direction or under the supervision of the PTA. This means that PTA You will probably be required to purchase or must clearly be "in charge" of the activity. lease the card processing equipment, depending on the company and the type of machine; it can cost several hundred dollars. To determine that PTA directed or supervised the activity, ALL of the following criteria are Although leasing appears more expensive, used: you may not want to purchase equipment that 1. If there was a contract involved, is not transferable to another provider. If your the PTA president must have organization is unhappy with the company's signed the contract in service or determines that the expense is not accordance with the provisions of justified, you do not want to have an the bylaws. If someone else (i.e., expensive machine that you no longer need. a school principal or staff member) signed the contract, the Paypal activity is not a PTA activity. Another electronic payment option is Paypal. Paypal is an online bank that accepts 2. PTA must have been involved in payments via email. This service allows your the creation, planning, and the members to pay with checking account or implementation of the activity and the credit card while your PTA bank account PTA must: information remains secure. • Provide the majority of the manpower for the This may be the most economical way for activity through volunteer your PTA to accept credit cards. If you are PTA members; and, interested in information on the services • Have a properly offered by this company go to structured committee for www.paypal.com. the activity PTA Credit Cards The subject of PTA credit cards continues to 3. School district employees come up for discussion. The financial policies (teachers, principals, or other staff of PTA have been in place for many years involved in the activity) must be, for and they are there to protect the members the most part, on their own time (non- and the organization. Requiring two staff time.) 10 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS It is recommended that the motion approving 4. The activity must: the establishment of a "Restricted Fund" be a) Have been approved by voted on by the general membership. the PTA membership or board of directors; and Important: Once the "Restricted Fund" is b) Be part of the PTA's established- those funds may be used ONLY budget. for the purpose(s) stated in the motion. If the activity does not or cannot meet these A separate bank account should be set up to criteria, then the activity is NOT a PTA collect such funds. activity and the money that is raised at the activity does NOT belong to PTA. All money The financial status of the "Restricted Fund" deposited in the PTA account will be is reported as part of the monthly and annual considered PTA funds by the IRS and must financial reports. be reported as such. A PTA should never deposit school or school-related money in its THE AUDIT account. The audit (or financial review) RESTRICTED FUNDS involves an examination of the financial transactions of the PTA, and the procedures Many PTAs identify projects where it will used to conduct those transactions. be necessary to accumulate funds over a period of time- usually extending beyond two Although it is the Treasurer who is (2) years- in order to fund the project. When the custodian of the funds of the PTA and is this happens, it is recommended that the PTA charged with the responsibility to deposit and establish a "Restricted Fund." disburse funds, and keep accurate records, it is the board of directors that has the A "Restricted Fund" is established when responsibility to see that the funds of the PTA the PTA adopts/approves a motion to set are administered properly and in the best aside funds for a specific purpose. Usually, interests of the members. as part of that motion, there is a statement on how those funds will be raised. To assure that this has been done, that the board acted responsibly, and that Example 1: "I move that the Sample good financial practices have been followed, PTA set aside and accumulates funds an audit (or financial review) of the books and to be used for _____________. records must be conducted. Example 2: "I move that the Sample An audit must be conducted: PTA set aside and accumulates funds to be used for _____________. An • Immediately following the end of annual activity shall be designated for the fiscal year purposes of raising these funds. • anytime a new person assumes the position of Treasurer. Example 3: "I move that the Sample PTA set • Any time there is a question aside and accumulate funds to be aside and about the financial well-being or accumulate funds to be used for performance of the PTA. ___________. Fifty percent (50%) of the year-end carry forward shall be used for this WHO CAN AUDIT purpose. A Qualified Accountant Example 4: "I move that the Sample PTA set This is an individual or firm that is in the aside and accumulate funds to be used for business of providing Accounting services ________. The board of directors shall and is qualified to do an inspection (financial annually establish an review) of books and records. amount to be transferred from the general OR fund for this purpose. An Audit Committee This committee must consist of no less than 11 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS three (3) members of the PTA whose books/records are being audited. Non- members or members of another PTA do not RESPONSIBILITIES have the right to examine those records. The Audit Committee The committee should not include any person • investigates and examines facts. who is authorized to sign on the unit/council • draws conclusions from the facts. bank accounts. If a member in the local unit • presents a written report of its work volunteers to perform the audit, he or she to the board. should not be a member of the executive As part of its work, the committee committee or a close relative of anyone who may interview people who handled funds. signs checks. The Treasurer, while not a member of the PREPARATION audit committee, is a resource to the committee. The Treasurer is normally not FIRST, prior to the Audit, the Executive present when the committee meets, but Board should fill out the AK PTA Financial should be available (usually by phone) to Management Checklist and submit a copy of answer questions. it with the financial records for audit. The Board of Directors NEXT, the Treasurer should gather all the -Receives the report from the committee. financial records together for delivery to the audit committee. - Acts on the report. It is very important that the PTA's financial The board of directors has the legal records be "put in order" for the auditing responsibility to report the results of the audit process. to the membership and, if action is necessary, what the board has done or will The following should be delivered to the audit do in response to the report. committee: • Checkbook and canceled checks. If the report is fine and everything is in order, • Bank statements and duplicate then reporting to the membership is easy. deposit slips. • Income ledger. If the audit reveals some procedural area(s) • Expense ledger. that need improvement, the board must • Copies of all bills, invoices, and examine the committee's recommendations receipts for which a check was and implement those it feels are important written. and necessary. Some changes may be very • Copies of all membership and board informal, and others may be quite formal - of directors minutes. perhaps, requiring changes to the PTA's • Copies of the monthly financial standing rules. reports. If on the other hand, the report points • All undistributed membership cards. out the improper administration of the PTA's • Copy of the Annual Treasurer's funds, or the theft of funds, or other serious Report. charges - the board must immediately act to • Copy of the budget for the period fix what is wrong. This would include the being audited. collecting of any funds that are missing. • Other material or information requested by the audit committee. A "Financial Management/Audit Checklist" • Copy of the last audit. can be found in the Appendix. WRITING CHECKS In all cases, the audit results and The PTA has the obligation to the action of the board continue paying its debts - even while the MUST BE REPORTED audit is being conducted. Generally, this does to the membership. 12 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS not present a problem because the audit will ITEMS TO LOOK FOR IN SAMPLE TEST take only a few days. However, when extra OF TRANSACTIONS: time is required for the audit, the board of directors may authorize the writing of a check • Is it on the monthly bank reconciliation? or checks in order that the PTA meet its legal • 2 signatures on EVERY check? obligations to those to whom it owes money. • Unexplained reconciling items? • Check endorsement matches payee? AUDIT COMMITTEE PROCEDURES • Are disbursements supported by 1. READ "FINANCIAL MANAGEMENT invoices/receipt or other documentation? CHECKLIST" FILLED OUT BY THE • Deposit ticket dates timely with bank EXECUTIVE BOARD to become familiar received date? with this PTA's financial management practices. • Timeliness of deposits with dates of events? 2. START WITH RECORDS POSTED AFTER THE ENDING DATE OF THE LAST • All invoices paid with check and not cash? AUDIT. • Check to see if the amount shown on the • All income and expenditures allocated to proper category of approved budget? last bank statement/reconciliation corresponds to the starting balance recorded in the checkbook and register. 4. STATE AND NATIONAL PORTION OF 3. DO A SAMPLE TEST OF DUES TRANSACTIONS • Was state/national portion of dues • Expenditures and receipts forwarded to AK PTA in a timely • Size of sample depends on size of PTA Manner? Example • Check that receipts of said dues • Verify all transactions over $100 or $250 ($5.75 per member) is kept separate or $500. from local unit portion of dues and • Expenditures: This means comparing the other receipts on the books check register amount to the cancelled check to the endorsement (on back of 5. MONEY COLLECTED FOR A check) to the check receipt SPECIFIC PURPOSE…. • Receipts: Compare check register to Special projects, Founders Day gift, deposit slip to bank statement scholarship funds, council dues, etc. If mistakes are found, expand your sample have been disbursed accordingly size. At some point you may deem it necessary to audit all the transactions of the 6. FILL OUT PTA AUDIT REPORT FORM PTA. • Check figures against Treasurers reports and annual reports. Check them against the books/ledger total for accuracy • FILL OUT PTA AUDIT REPORT FORM from above information 13 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS 7. IF ALL IS IN ORDER What if the Treasurer being audited cannot or will not get you the • The Audit Committee should prepare information you requested? a statement • Each member of that committee • Contact Alaska PTA via phone call to should sign and date it. the President A sample statement of auditors might read: The auditing committee has examined the • You may be advised to send a records of the treasurer of _____ PTA for the registered letter to the Treasurer period of 7-01-0?_ to demanding the information. 06-30-0?__and found them to be correct. Balance on hand $_______. (Signatures of 9. THE AUDIT REPORT MUST BY committee). PRESENTED TO MEMBERSHIP 8. IF NOT IN ORDER, THE AUDITOR(s) • OFFICIALLY ADOPTED BY THE MUST ALSO SUBMIT A REPORT: MEMBERSHIP. If not adequate records to conduct a proper • Report is include in the Annual audit: Report covering the entire fiscal year • Sample statement might be: "The • If additional information and auditing committee has examined the verification was noted as being records of the treasurer of __________PTA and finds that more needed, it should be provided by adequate accounting procedures need to Treasurer. be followed so a more thorough audit report can be given." 10. IF VALIDITY OF AUDIT • Audit committee should be sure to REPORT IS QUESTIONED include the information that is needed. HAVE TREASURER CORRECT ANY • Contact Alaska PTA CORRECTIBLE ERRORS: • When Board of Directors is satisfied that SEE SAMPLE AUDIT the financial accounts are correct, draw a line across the ledger where the audit CHECKLIST IN THE APPENDIX concludes MISAPPROPRIATION OF • Sign and date the ledger using a different FUNDS PROCEDURES color ink • State: "Corrected by Treasurer If proper financial procedures have been ____________ and found correct." consistently followed, your PTA should • Name(s) and date. not have any problems accounting for all funds. However, if there is money missing or embezzlement is suspected, your PTA's Executive Board has a legal responsibility to instigate an investigation and recover the funds. Failure to take action could make Board Members co- conspirators in the illegal act. Utmost care should be taken to avoid libelous actions against the suspected person(s) involved while pursuing the recovery of the funds. If there is an indication of mishandling of funds, the 14 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS Executive Board should have a professional audit done or contact the PTA AND THE LAW FEDERAL State Office to assign an Alaska PTA REQUIREMENTS Board of Managers member to assist It is very important that PTA officers, your PTA. especially presidents and treasurers, understand the relationship between PTA If the audit confirms misappropriation of and governmental regulatory agencies, funds, or you are unable to conduct the specifically the Internal Revenue Service audit due to the lack of records, or if the (General Information: 800-829-1040) and the person(s) involved refuses to cooperate Alaska Department of Revenue (General by turning the records over to you, Information:) PLEASE READ THIS contact your local police department. INFORMATION IN IT'S ENTIRETY. Once the case is in the hands of the Employer Identification Number (EIN) authorities, they will handle it from there. A. Every unit and council must have an IRS Employer Identification Number (EIN). The only time the PTA should accept This number is required for bank restitution is if the entire verified amount accounts, merchant's license application, of missing money is returned in one lump group tax-exempt application, and filing sum. Once a partial payment is accepted any federal forms. One of the first steps and no other payments are made, when organizing a new PTA is to apply criminal charges cannot be made and it for an EIN number (you can apply online takes a civil suit to recover the money. at www.irs.gov). A general report should be made to the If you are organizing a new unit and need to open a bank account before you have been full membership acknowledging the assigned an EIN number, make the bank problem and the actions taken to resolve aware that you are in the process of applying the situation. However, it is not advisable for your tax ID number and the bank should to publicly reveal the offender's name; work with you until your EIN number has you should spare his/her children of been assigned. having to be teased or ridiculed by others. If the press reports on the story, Someone's personal social security number stress the steps that have been taken to should never be used as the tax identification recover the funds and the fiduciary steps number on the PTA's bank accounts. that are in place to make sure it will not B. The EIN should be kept with your happen again. permanent records. REMEMBER!!! C. Most PTA's in Alaska now have an EIN. If you are not sure about yours, contact • Every action MUST be taken by the the Alaska PTA Office to determine board of directors - not the executive whether your local unit already has one. committee or the Treasurer or the If not, you can now file on-line at the IRS President or other officers - but by web site www.irs.gov . or AK PTA can the entire board of directors. provide an application (SS-4) with • The board of directors MUST take instruction for completion. Mail to every reasonable step to collect or Internal Revenue Service Center, recover the missing funds. Attention: EIN Operations, Philadelphia, • All the actions of the board must be PA 19255. recorded in the minutes of the board. • At some point, the board will have to Processing could take 6-8 weeks. (See report the missing funds, as well as Appendix). the board's attempt to recover the funds, to the membership. D. You can now file on-line at the IRS web site www.irs.gov . 15 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS 2. PTAs must have use of the group Federal Tax Exemption tax-exempt number to apply for a non-profit bulk mail permit. PTA units and councils included in the group tax exemption of the Alaska PTA are exempt 3. Without use of the group tax- from income tax under Section 501(c)(3) of exempt number your parent the IRS Code and may use the Alaska PTA group must file a tax return (Form tax-exempt number. 990/990EZ) if gross receipts exceed $5,000. If you have use A. To include your unit or council in the of the group tax-exempt number, group tax exempt coverage is a one-time it is not necessary to file unless process - check with the Alaska PTA gross receipts exceed $25,000. Office if you are not sure whether your (For additional information on PTA is already covered. Form 990EZ, see Section III.) 1. Check to see that your bylaws C. Alaska PTA's group exemption roster is are up-to-date and that you are updated annually by Alaska PTA to add current in paying your new PTAs, and delete PTAs which have membership dues and your not maintained valid charters. insurance payment to the Alaska PTA Office. H.U.G.S. To maintain a valid charter, units or councils 2. Write to the Alaska PTA Office, must be HEALTHY UNITS IN GOOD and request two (2) statements STANDING (H.U.G.S), which consists of: of authorization. (Also request a SS-4 form if your PTA does not • Bylaws must be approved by the State have an EIN (Employer PTA Bylaws Committee every five years Identification Number) (See • Local unit dues must be paid annually by Appendix). th th October 15 , December 15 , and March st 31 (dues payment does not apply to 3. Complete the Statements of councils). Authorization and return one • Membership lists must accompany each copy to the Alaska PTA office. dues check. Put the other in your permanent • Paid insurance annually to Alaska PTA file. • Submitted copies of their filed form 990EZ, 990, or 990-N (which ever form 4. When your application is is applicable). approved, the Alaska PTA office • Submitted copies of their current audits will send your PTA an to Alaska PTA. individualized letter authorizing the use of the group tax exemption • Current Officers List on file with Alaska number. Keep this letter with your PTA. permanent records. Disassociation from PTA: B. Benefits of being included under the If your unit decides to disassociate itself from Alaska PTA group tax exempt number: the National and State PTA and become an independent unit (PTO or other parent 1. Individuals or businesses may group): claim donations of prizes, equipment, cash, etc. to PTA as 1. Federal regulations require that charitable tax deductions as Alaska PTA notify the Internal provided in Section 170 of the Revenue Service that you are no IRS Code. longer entitled to tax exempt status under the group exemption of Alaska PTA, effective immediately upon dissolution of your unit. 16 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS th 990EZ's due date is the 15 day of the fifth 2. Federal regulations require that you, month of your unit's fiscal year. For example- the PTA Unit notify all of your if your fiscal year ends on June 30th, the th members, donors, potential donors, 990EZ is due by November 15 . and participants in your activities that you are not tax exempt and that no Gross receipts are the total amount received contributions and/or out of pocket from all income sources during the annual expenses may be deducted from accounting period, without subtracting any their federal income tax, effective costs or expenses. immediately upon dissolution of your unit. This does NOT include State and National portion of Dues or transfers between bank accounts. Always complete and return the 3. Federal regulations also require that form if the unit receives it even if you did not your PTA unit turn over all records, make more than $25,000 that year. funds and other assets to either the Alaska PTA, or one or more non- The IRS will assess penalties if this form is profit funds, foundations, or not returned. If necessary, an extension can organizations which have established be filed for the Form 990EZ by filing FORM their tax exempt status under section 2758 before the deadline. Basic instructions 501(c) (3) of the Internal Revenue for filling out the Form 990 EZ can be found code. in the Appendix or National PTA's PTA Money Matters. These instructions are A requirement in your bylaws by Alaska intended only to help clarify the instructions PTA states that your PTA unit must turn for Form 990EZ as published by the Internal over these records, funds, and other Revenue Service. They are not intended to assets to another PTA organized under replace those instructions. Current forms Alaska PTA, to Alaska PTA or to another and instructions for the Forms 990 and organization approved by Alaska PTA. 990EZ can be found on the IRS website at www.irs.gov. 4. Article V, Section 10 of the National FILING FORM 990-N PTA Bylaws specifies that State PTAs are responsible for compliance With the enactment of the Pension Protection by local council, district or region Act of 2006, beginning in 2008, small tax- PTAs within its area with the Bylaws exempt organizations that previously were of the National PTA. We therefore not required to file informational returns in the must require that you send to form of 990 / 990EZ will now be required to Alaska PTA the name of the file a new annual notice, Form 990-N. The organization to which your PTA new e-Postcard is simple and straightforward intends to turn over its records, and being termed an "e-Postcard" because it funds, and other assets and proof of will be "short, easy, free, and electronic". the 501 ( c ) (3.) tax exempt status of that organization for Alaska PTA's This new e-Postcard will affect every Alaska approval. This procedure must be PTA that isn't required to file a Form 990 or followed so that Alaska PTA can be 990EZ. assured that your unit has fully complied with all federal laws. The e-Postcard is expected to require an organization to provide the following FILING FORM 990 / 990EZ information: • Organization's legal name and Form 990EZ / 990 is required to be filed if mailing address ANY of the following is true: 1)The unit's • Any other names used gross receipts are more than $25,000 2)If the • A Website address if one exists units gross receipts is usually over $25,000, • Organizations employer ID number or 3) Form 990EZ form is sent to the unit by (EIN) the Internal Revenue Service. The Form 17 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS • The name and address of a principal WHEN TO FILE: officer th • Organization's annual tax period Form must be filed by the 15 day of the fifth • A statement confirming the month after the end of your fiscal year as organization's annual gross receipts noted in your bylaws. For example, for a are normally $25,000 or less fiscal year ending on June 30, the filing th • Indicate if your organization has deadline is the following November 15 . terminated (no longer in business). The law imposes a penalty of $10.00 per day, up to a maximum of $5,000, when a It is important to note that any organization 990EZ return is filed late, unless there is a that fails to meet its annual reporting reasonable cause for the delay. In order to requirement for three consecutive years receive an extension, you must file Form automatically loses its tax-exempt status 2758 with the IRS to request an extension under the new law. and avoid this penalty. Further information on the new Form 990-N can be found on the IRS website at UNRELATED BUSINESS INCOME www.irs.gov in the charities and non-profits section. There is also a Frequently Asked When can tax-exempt organizations be Questions section that is very informative. taxed? FINALLY, don't forget to send a copy of Not-for-profit organizations, such as PTAs, whatever form your unit files to the Alaska are eligible for tax-exempt status, but this PTA Office. status does not mean that PTAs are never required to pay tax. Certain income- HOW TO FILE (IF YOU ARE REQUIRED producing activities carried on by PTAs may TO FILE): fit into a tax liability category called unrelated business income, or UBI. 1. Local unit filling out 990EZ: If a PTA conducts one or more activities that Refer to National PTA's Money gross Unrelated Business Income of greater Matters, or Appendix of this than $1,000, then the PTA needs to report handbook for a sample-completed these earnings to the IRS on Form 990-T. form, and check IRS web site at www.irs.gov for complete If this income is determined to be UBI, then it instructions. will be taxed at regular corporate rates with some exceptions. Most PTA fund-raising Note: Schedule A must be completed activities are the exception and exempt from and attached to the Form 990EZ federal income taxes because of the (See Appendix). following: OR • They are conducted only once per year, or 2. Consult a local accountant with • 85% of the work on the activity is non-profit experience. This is conducted by volunteers, or becoming more and more a • They consist of selling donated popular option if there is no one merchandise. in your local unit with the expertise and or the time to fill There is no rule that says PTAs must never out the informational return. conduct activities that produce unrelated business income, but in order to retain tax- 3. Send a copy of the 990EZ to exempt status, PTAs must pay attention that Alaska PTA Office. fund-raising does not become the primary focus of the organization. Whether income is related or unrelated is almost always determined by the nature of 18 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS the income producing activity in relation to discontinuously or periodically will not be the nonprofit exempt purpose and rarely how considered "regularly carried on." Once-a- a nonprofit uses its money. How an activity is year activity occurring at the same time every structured can usually determine if income is year, such as a fund-raising dance every related or unrelated. spring or operating a sandwich stand at a state fair for two weeks every summer may The following is a review of the conditions not be considered "regularly carried on." that must exist in order for an organization to generate unrelated business income, and What these types of events have in common may help PTAs avoid generating taxable is short duration. In contrast, activities have income, if that is the goal. been found to be regularly carried on where preparation or follow-up stretches over a long period. UNRELATED BUSINESS INCOME On the other hand, an activity occurring only DEFINITION once per year might also be considered The IRS definition of unrelated business regular if a commercial company performing income carries three factors that must all be the same activity would also be active only present for income to be considered UBI, and once per year, e.g., selling Christmas trees in therefore, taxable: December or turkeys in November. The income must be: A Business "unrelated to the organizations • From a business exempt purpose." • That is regularly carried on and • That is unrelated to the If an activity is substantially related to the organizations exempt purpose. exempt function of the organization, then Income "from a business." A business is even if it does constitute a business and is generally an activity carried on for the regularly carried on, the income it generates production of income from the sale of goods will not be subject to tax. A substantially or the performance of services. Not all related activity, according to IRS regulations income-generating activities constitute a helps to cause the achievement of the business. On the other hand, to be organizations exempt purpose in an considered a business, an activity need only important way. produce income; it does not have to produce a profit. Following are some examples of activities An activity can be a business even if it loses that produce income and are regularly carried money every year. In such cases, even on by tax-exempt organizations. However, though the organization may not have any tax because these activities are substantially liability from a business operated at a loss, it related and contribute importantly to their is still a business. organizations exempt purpose, they do not qualify UBI: In the "sale of goods or the performance of services," the activity is not considered a • Trade associations charging business unless the organization takes an registration fees for their conventions active role in the generation of the income. • Museums charging fees for The income a tax-exempt organization earns admission from passive activity, such as the payment of • Neighborhood block clubs charging dividends, interest, rent, or royalties is not a admission to social events. business, except under special circumstances. (Consult the IRS or the Alaska PTA Office if questionable.) A business "regularly carried on" is the second qualification to consider when determining whether a "business" is UBI or not. Activities that are carried on only 19 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS UNRELATED BUSINESS INCOME IRS AUDIT EXCEPTIONS The Internal Revenue Service has The Treasury Regulations provide several announced that it will attempt to audit all special exceptions to the general rules on nonprofit organizations over a ten year which unrelated business income activities period. This increases the prospect of an are subject to tax. The following are special audit for your PTA. exceptions that apply to PTA's: Currently there are three basic methods of Volunteer activities. A UBI exception is auditing that the IRS uses: made if substantially all the work on an • Mail Audit - a specific item is activity is done without compensation, that is, questioned and can easily be verified by volunteers. The Treasury Regulations by submitting the requested limit the paid labor on an activity to 15% of documentation through the mail. the total labor. Additionally, the work done by • Office Audit – IRS conducts the audit the volunteers must make an important at it's own office. contribution to the production of income. • Field Audit – The audit is Low-cost merchandise. Another UBI conducted at the organization's place of exception is made on any income received business. from the distribution of low cost articles incidental to the solicitation of charitable If your PTA is selected to be audited contributions, such as return address stickers you will be notified by mail. The enclosed in solicitation letters. An item is "audit letter" will specify the method considered "low-cost" if it costs the of examination and which records organization less than $8.30 (2005 figure). you will need to assemble to This exception applies as long as the person substantiate items reported on your solicited can keep the item with or without Form 990EZ. making a donation. The organization will not need to keep within this limit if the articles Respond promptly to any being distributed promote its exempt correspondence from the IRS. purpose. Answer only the questions asked. In letters to the IRS, include your Donated merchandise. The sale of taxpayers identification number (EIN) donated merchandise is another UBI and the document locator number exception. If a tax-exempt organization shown on the IRS correspondence. resells items that have been donated to it, it Send your reply by certified mail, does not have to pay tax on the profit. retaining a copy for your files. Corporate sponsorships. Qualified Your should maintain consistent and sponsorship payments are exempt from accurate records, and retain them for unrelated business income tax. For a a minimum of six years. (see payment to qualify for the exemption the Appendix for Timetable for Retaining sponsor must not receive substantial benefit Records). The best defense against in return, other than the use or an IRS audit is an accurate, properly acknowledgement of the sponsors name documented return. logo, or product lines in connection with the nonprofit organizations activities. Use or acknowledgment does not include advertising STATEMENT FOR RECIPIENTS OF the sponsor's product or services. MISCELLANEOUS INCOME IRS FORM 1099-MISC For more detailed information on UBI, See IRS Pub. 598 Tax on Unrelated Business PTAs are required to file Form 1099-Misc Income of Exempt Organizations (can be with the IRS if they pay $600 or more during downloaded at www.irs.gov ) the calendar year to any unincorporated 20 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS business or person for services rendered or GENERAL INFORMATION in payment for a grant, award or scholarship. BULK MAILING PERMIT 1099-MISC forms are not required to be issued to corporations or to those paid less A unit, council or district may apply for a non- than $600. profit bulk mailing postal permit, which can save substantial money. To use it, at least Here are some examples or payments 200 pieces or 50 pounds of like mail must be requiring the filing of Form 1099-MISC that sent at one time. Your local post office has your PTA may encounter: the specific form and directions for applying. 1. Payments of $600 or more to a One of the items you will be required to volunteer for expenses when the provide to the postal service is a letter from volunteer does not provide the the Internal Revenue Service proving your PTA with specific documentation tax-exempt status under 501 (c) (3). You may for the expenses incurred on obtain this information from the Alaska PTA behalf of PTA. office. We will provide your unit with the 2. Payment of $600 or more for a Group Tax Exemption letter from the IRS scholarship awarded to an along with a personalized letter stating your individual when the PTA does not unit is a Healthy Unit in Good Standing have written verification that the (H.U.G.S.) with the Alaska PTA. You will money was specifically used for also need to have a copy of your current tuition and related expenses. bylaws for the postal service. 3. Payments of $600 or more in a calendar year to an unincorporated entity as a grant INSURANCE or for services rendered. Alaska PTA has negotiated an insurance For information regarding when and how to package for all Alaska local units and file, you can obtain a copy of the instructions councils. Effective December 1, 2004, for Form 1099-MISC from the Internal insurance is now mandatory. This statewide Revenue Service web site www.irs.gov. insurance coverage is billed annually in the 1099-MISC forms must be sent to the fall, and must be paid in a timely manner to recipients on or before January 31 of each Alaska PTA in order to be a Healthy Unit in year and filed with the Internal Revenue Good Standing (H.U.G.S.) Local units should th Service on or before February 28 of the receive invoices for the upcoming policy same year. period in August. The name and address of the recipient, his or her social security number (or Employer Identification Number) and the amount of the Coverage Includes: payments must be included on Form 1099- rd MISC. To obtain the information necessary 1.General Liability Insurance provides 3 to properly prepare Form 1099-MISC, the party liability coverage plus covers all routine treasurer should send the payee a Form W-9, activities of your PTA (meetings, festivals, Payer's Request for Taxpayer Identification skating parties, parades, etc.) and offers Number and Certification. liability protection for bodily injury, personal injury, property damage, hazards to the A procedure should be established to gather general public, libel/slander, etc. It covers the information necessary to complete these legal fees, often the most expensive part of a forms (especially the gathering of social liability claim. security or Employer Identification Numbers). 2. Bonding policy Plus covers losses sustained by a PTA unit or council through any fraudulent or dishonest act or acts committed by any of the employees or non- compensated elected officers and their successors, or any non-compensated person 21 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS in a unit or council who is authorized by an officer to handle unit or council moneys acting alone or in conspiracy with others. When entering into a contract, the president is responsible for the agreement and should 3. Directors and Officer's Liability picks up clearly identify that it is the unit entering into where General Liability leaves off to provide the contract and not the president as an rd insurance protection for 3 Party liability individual. claims alleging management errors or omission including supplemental defense. The signature on a written contract should read: Additional coverage can be requested on a "_________PTA or PTSA unit or council by: per unit basis by contacting the Alaska PTA (Name)_______________________ office where you will receive the contact President Date information of our insurance broker. (Name)________________________ Title (one other PTA officer's signature) Date If there is any question about the terms or conditions of the contract, the proper time to CONTRACTS seek advice is before you have put your signature on the dotted line. In the course of a year, many units and councils enter into a variety of Contracts. CERTIFICATES OF DEPOSIT ** ALL CONTRACTS SHOULD BE IN Certificates of Deposit (CD's) are also OK. WRITING ** These are the same as savings accounts except that they usually pay a higher rate of The PTA unit assumes the responsibility and interest. However, the PTA must pledge to the legal obligation to comply with the terms leave its money in the account for a specified and conditions of the contract including any period of time or pay a penalty. Therefore, payments specified by the contract. care must be exercised to be sure the PTA The fact that an activity is not a financial will not need that money during that period of success or that the PTA has insufficient funds time. to meet its obligation has no effect on the legal requirements to fulfill the terms of the SALES TAX contract. Your PTA may not be exempt from paying Before entering into a contract on behalf of a local sales tax. This will depend on your type local unit, the following points should be of income in many cases. Please do the considered: proper research to determine your 1. Does the person negotiating the responsibility for sales tax. contract have the necessary authority to do so? FOUNDERS DAY GIFT 2. Has the board of directors reviewed and authorized the A FREE-WILL OFFERING MAY BE EITHER contract? COLLECTED AT Founders Day celebrations, 3. Are all the terms and conditions provided for in the budget or granted by vote of the contract, including the fine of the membership. Your PTA's gift is sent to print, understood and agreeable the State Office where it is divided between to PTA National and the state. Contributions are 4. Does the PTA have the ability to used to increase the capacity of the PTA to comply with all the terms the serve children and youth. All contributions contract, even if the event is not should be clearly marked "Founders Day Gift" successful? and made payable to the Alaska PTA. Only elected officers should sign contracts! 22 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS FUND-RAISING INFORMATION There are numerous ways to raise money successfully for your PTA. Choose the GUIDELINES FOR A SUCCESSFUL FUND- method that is most suitable for your group. RAISER A PTA should never engage in a fund-raising activity that is contrary to PTA's mission and "The primary emphasis of PTA is the policy. promotion of the PTA Mission and PTA Examples: Objects. A PTA's real working capital lies in its members, not its treasury. When PTAs • Bake sales/suppers invest their human resources in programs, • Auctions they create benefits for all children and youth • Merchandise sales (commercial with modest outlays of money." products such as candy, wrapping paper, T-shirts, Remember PTA policy - children should novelties, etc.) never be exploited or used as fund-raisers. • Car washes • Carnivals/festivals/fund days • Pledges (walk-a-thons, read-a- Many school boards have policies concerning thons, phone-a-thons, etc.) fund-raising. Check with your superintendent • Book fairs for your local school board's policies and for • Performances with paid further restrictions, which may apply in your admission school system. National PTA sends out an annual publication Purpose: No fund raising program should be titled PTA Fundraising Essentials that has held without a PURPOSE, and the members lots of expert advice on fundraising event of your local unit should support that purpose. ideas, tips on pursuing grants, strategies for PTAs are not primarily fund-raisers. organizing volunteers, and lots of other fundraising tidbits. It is sent out annually to REMEMBER THE "3 TO 1" RULE: all PTA leaders and public school principals. FOR EACH FUND-RAISING ACTIVITY, THE Look for additional information at PTA SHOULD PLAN AT LEAST THREE (3) www.pta.org/fundraising or contact the TYPES OF EDUCATIONAL Alaska PTA office. ACITIVITIES/PROGRAMS FOR PARENTS AND CHILDREN. DEDUCTIBILITY OF CONTRIBUTIONS HOW MUCH FUND-RAISING SHOULD MADE TO PTAs: PTAs DO? • IRS regulations state that charities must provide a written statement or The PTA should be raising only the money it receipt to a donor for any donated needs to conduct its own projects and item, except for donations by check programs while advocating for adequate of less then $250 where the check is funding of school equipment and supplies considered the receipt. from those governmental bodies who have the legal responsibility of meeting those • IRS regulations state that charities needs (school boards, municipalities, must also provide a written boroughs, and the state and federal disclosure statement to a donor for a governments). quid pro quo contribution of more than $75. This type of contribution is A PTA should conduct three non-fund-raising a payment made partly as a projects aimed at helping parents and contribution and partly in exchange children or advocating for school for goods and/or services. improvement for each fund-raising activity it holds. (The "3 to 1" guideline). • Effective for tax years following 8/17/06, new recordkeeping rule for KINDS OF FUND-RAISERS monetary contributions of ANY amount (whether with cash, check, electronic funds transfer, credit card, 23 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS or other monetary contributions), the every member who subscribes to a certain donor must obtain and keep a bank telephone long distance plan. ) The amount record or written communication from of that gift is determined by how successful donee as a record of the contribution. the business is in selling its products or service and has little to do with the efforts of • Donations/scholarships/grants the PTA and its members. contributions of $250 or more must be acknowledged in writing by the Given the PTA's noncommercial policy, the recipient to the donor. only appropriate role in any such venture is a passive one. • Penalties can be assessed if documentation regulations are not Active promotion, sale or marketing of the followed. Access National PTAs business' products or services by the PTA Money Matters book or the IRS and its members would violate the non- website at www.irs.gov for commercial policy. In many cases, revenue additional information and form received from such efforts is seen as taxable examples. unrelated business income and the PTA would have to file and pay federal taxes on this income. GAMING IE: BINGO-RAFFLES Before starting any joint financial project, a PTA should consider whether the In Alaska GAMBLING is defined as: arrangement could be viewed as an (1)"contest of chance" means a contest, endorsement of a product, company or game, gaming scheme, or gaming device in foundation. If so, it should be restructured to which the outcome depends in a material remove the aspect of endorsement or degree upon an element of chance." promotion. If that is not possible, the PTA should not participate. (2)"gambling" means that a person stakes or risks something of value upon the outcome of If the PTA is already involved in an ongoing a contest of chance or a future contingent or past relationship with a commercial event not under the person's control or enterprise that does not meet the PTA's non- influence. commercial policy, the relationship should be restructured, if possible, or ended to avoid Alaska PTA does NOT recommend that your the continuation of any unacceptable unit participate in the above types of fund practices. raisers. PTAs must maintain financial records of the gambling activity, and risk their Planning: Any fund raising project should non-profit status if they don't follow all the have a committee, which could include the Gaming rules and regulations required by the following: State of Alaska. 1. Project chairman to coordinate For more information go to: the entire program or project. www.tax.state.ak.us/programs/gaming/faq.asp 2. Local unit treasurer to account for all monies. COMMERCIAL CO-VENTURING 3. Distribution subcommittee chairman to keep track of all WARINING! Commercial co-venturing, a new merchandise being sold and to form of fund raising, is Not recommended reorder additional merchandise because monies generated from these types as needed. of activities may be considered unrelated 4. Publicity subcommittee chairman business income and are usually taxable. A business will advertise a cooperative fund Protection: When selecting a fund raising raising effort in which money is paid to the program where merchandise is to be sold, business for a product or service and a the most important decision is W HO WILL BE portion of that money is given to the PTA. YOUR SUPPLIER. When possible, always have (For example, the PTA receives $5.00 for more than one supplier present their 24 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS programs to you. It is helpful to have these For the protection of your association, if you presentations at the same meeting, if are incorporated, sign the agreement as possible, so you can compare the programs discussed under "Contracts" while everything is fresh in your mind. Ask the suppliers to meet with members of your Product: Is the selling price fair to the total board. This is their business, and if they consumer? want YOUR business, they can take the time to meet with you. Pride: Do you think your members will feel good about selling the item? Following are a few questions you should Prospective Customers: Select an item you ask each supplier: feel will be useful and will best sell to your target market 1. Will the supplier take back all unsold merchandise? Profit: (Not percentage) Multiply how many (Personalized items cannot be items you believe each member of your returned.) group can sell times the profit of each item to 2. Who pays the freight? If the find your potential PROFIT. (Note: Estimate company pays freight, do they what you believe your unit can sell, not what charge any of it back to the the supplier says you might sell.). group? 3. Who pays the freight on returned Public Relations: DO NOT send unsolicited merchandise? merchandise home with your children. You 4. How long will it take to get the may get many parent complaints and incur product(s)? losses from those who do not wish to return 5. Can you get the product without the merchandise or pay for it. If you do not an advance investment? like company sales information, write and 6. If your project does not go well, print your own. will you lose money? If so, how much-a percentage or the total Stress that parents, not children, should do amount? the selling. 7. How long has the company been in the fund raising business Program: Once you have selected a product, 8. Does the company have a local it is time to begin: representative? 9. Is the quality of their product 1. Announce your goal to the guaranteed? membership of your unit and let 10. Does the company have any them know what they can do to local success stories? If so help the group achieve that goal. contact those groups and ask not only how much money they 2. Place your order with the made, but also what (if any) supplier. Have ALL details and problems they encountered and agreements in writing. what they especially liked about dealing with the company. 11. Is there an agreement or contract 3. Have your publicity chairman to sign? announce the upcoming sale in 12. Will they accept a Certificate of your local PTA unit newsletter, Resale so we do not have to pay on the radio, etc. Upon sales tax? completion, remember to thank everyone for his or her Remember: If the unit is not incorporated, cooperation. the contract signer can become financially responsible if something goes wrong with the 4. Set up an incentive program for fund raising project. the selling members, if you feel it is necessary. 25 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS 5. Collect money from customer A. PTA has all the authority. PTA monies are before or at the time totally separate from the school's funds. If the merchandise is given to them— principal has control over PTA funds, then the NO CREDIT! principal must be held accountable in the event of an audit from the IRS, just as any 6. Upon completion, make sure you PTA would. pay your supplier on time. Q. Should the Principal make the decisions 7. If you have any problems with a on PTA funds? supplier, let the Better business Office and the Alaska PTA Office A. No. PTAs have all authority of the know for future reference. budgeting process of their PTA unit while considering, of course, input from the principal. The principal is in a good position to know the needs of the school and to make recommendations, but the PTA's general membership, from recommendations, budgets and plans presented to them by the PTA executive committee/board, makes the COMMONLY ASKED QUESTIONS & final decisions. The principal or his ANSWERS representative has only one vote, the same as all other board members. PTA units nationwide have similar questions concerning PTA funds and various requests Q. Should PTAs purchase "big ticket" items for usage of those funds. Here are some of for their school? i.e., playground equipment, those questions with their appropriate computers, etc., answers. A. The PTA should only consider this type of Q. Should any one person have full control purchase if they believe it will directly benefit over the PTA funds? the children in the school and after all other avenues of funding for such items have been A. No not ever, The PTA funds belong to the exhausted. PTAs need to be aware of local unit, not to any one individual. When liability issues involved with some types of only one person has full control, there is a these purchases, especially playground danger of misuse of funds. equipment. Q. Should PTAs pay salaries for substitute Q. Should PTA funds run through the teachers? school's or principal's account? A. Alaska PTA and National PTA do not A. Absolutely not! Only PTA money goes into recommend this for any reason because it is a PTA account. Two key questions to not within the Objects of the PTA to pay consider: Did the PTA raise it? And Does the teacher salaries. PTA decide how it is spent? If either answer is "no", don't do it. If PTA funds are used to pay substitute teachers, questions will arise as to who is Q. Are purchase requisitions (check request paying the employee taxes, is the employee slips or purchase orders) required to initiate contract labor, and who is responsible for expenditures? filing appropriate financial/tax reports quarterly or annually to the IRS. Alaska PTA A. This is highly recommended, but if your and National PTA do not recommend paying unit does not adopt this procedure, by all salaries for school-related employees. means you should require a receipt for all reimbursements. File receipts for yearly Q. Who has authority over PTA funds, the audit. principal or PTA? 26 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS Q. Should PTAs purchase office equipment, approve expenditures up to a certain amount and if so, should the PTA have the liberty of ($75.00-$100.00, for example). If this is not using it? stated, then the PTA Executive Board must approve the expenditure within the limits of A. Whenever a PTA purchases any type of the budget adopted by the association. Any equipment for their school, that equipment expenditure not included in the budget must immediately becomes the property of the be approved by the general membership. local Board of Education. Use of this equipment is then up to the Board of Q. How many fund-raisers should PTAs Education. Be aware that the local Board of have? Education can transfer the equipment to another school if it so chooses. A. Only what is required to meet your budget. Keep in mind that PTA's main goal is Q. Should the PTA pay for the service advocacy for and service to children, not contract? fund-raising. A good rule of thumb is to plan at least three (3) educational A. Once the equipment is placed on school activities/programs for each fund-raising property, it becomes the property of the local activity. Always check on your school Board of Education. We recommend that if district's policy regarding fund-raisers. the PTA purchases the equipment for the school, and the school should pay the service Q. What about PTA checking and savings contract, not the PTA since the equipment is accounts? not the property of the PTA. A. Alaska PTA and National PTA do not Q. State and National PTA sponsored advise PTAs have any more than two conferences (i.e., convention, leadership, accounts-. A savings account and checking legislative, etc) a valid budget item for my (operating) account, both accounts can local PTA.? operate with the same Employer's Identification Number (EIN). At many banks, A. Absolutely! Informed, responsible leaders service fees are eliminated if a minimum strengthen the network of local, State and balance is maintained. National PTA. Trained volunteers are better able to provide a variety of activities, Q. Should you have savings accounts with services, and programs, which benefit large amounts not earmarked? parents, teacher, children and the schools. A. Alaska PTA recommends that savings Q. Should PTAs pay for parties and accounts be used for programs during the luncheons for staff? summer and fall and to finance approved projects and/or programs as they come due. A. Alaska PTA acknowledges Teacher However, large sums of money in saving Appreciation Week and Secretary Week. We accounts must be earmarked for specific encourage all PTAs to support teachers projects/programs. throughout the year and especially during National Teacher Appreciation Week and Q. Must we have two (2) signatures on all Secretary Week: however, we do not checks? encourage PTAs to give big, expensive dinners off campus. We feel these funds A. Yes, two signatures are required, could be better utilized in the classroom in preferably those of the treasurer and one the interest of all students and teachers for other officer. This is per National PTA as educational purposes. stated in Money Matters, and protects the Treasurer, the Board, and the membership. Q. Should unforeseen requests be approved by the: PTA Executive Board, the PTA Q. Should the principal sign checks? President, or the General Membership? A. The principal should not be one the A. Check your bylaws- some PTA bylaws persons signing checks. allow the PTA President the authority to 27 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS Q. Is it necessary to file a Form 990EZ to the IRS? A. Anytime there is an embezzlement of funds, the board has specific duties it must A. You must file IRS form 990EZ if the annual legally fulfill. There are some options about gross income of your PTA units is $25,000 or what actions the board may take, but it must more, or if the PTA has received a Form act. It must inform the membership. Action 990EZ with a pre-addressed mailing label must be taken to recover the funds. from the IRS even though gross income is Concealing the embezzlement could make below $25,000. the board members coconspirators in this illegal act. The simplest, yet strongest, action Q. Is there a fine if you neglect to file Form the board could take would be to call the 990 EZ? police. A local unit should not make A. Yes: $10 per day up to a maximum fine of arrangements for restitution. Call the Alaska $5,000. PTA Office for assistance. Q. Should the PTA collect money for charitable/humanitarian causes (a family in the school who experiences a house fire, etc.) in the name of PTA or donate money from the PTA account? A. No. PTAs may not donate money to individuals or other organizations. Money cannot be collected in PTA's name and tax deductions offered because the cause is not part of PTA's education-focused mission. However, a separate account can be set up for that purpose using the social security number of the intended recipient of the money for an EIN. This account will not be tax-exempt unless separate 501 (c) (3) status is obtained for that fund. Q. Can other organizations in our school use our checking account or our PTA's Employer Identification Number (EIN) to open a new bank account? A. No. Only PTA funds belong in the PTA accounts. IRS regulations require that other groups or organizations have their own separate accounts and EIN numbers. The PTA is responsible for accounting for all of its funds held under its EIN number to the general membership of the PTA and, when required, to the IRS by the use of Federal Tax form 990EZ. Q. The audit committee reported that monies had been "lost" from the PTA checking account. This loss can be traced to one individual. The board does not want to do anything about it, and it does not want to report the "loss" to the membership. Instead, the board wants to hold a series of fund- raisers throughout the year to replace the money. Is this Ok? 28 COMMON CENTS HANDBOOK FOR AK PTA TREASURERS APPENDICES (THESE FORMS ARE SAMPLES ONLY. ORIGINAL COPIES ARE AVAILABLE FROM THE STATE PTA OFFICE.) A Financial Timeline Alaska Local PTA Unit B AK PTA Treasurers Remittance Form C Sample Form SS-4 Application for Employer Identification Number D Sample AK PTA Letter of Authorization E Check Request Form F Individual Member Form for Online Membership Reporting G 1-10 AUDIT PACKET / PTA Financial Management/Audit Checklist H Sample Certificate of Insurance I RECORDS RETENTION SCHEDULE J 1-3 Sample Mini-Grant Form K 1-12 Form 990EZ/Schedule A Sample IRS Forms and Instructions L 1-5 Sample Reports – Basic - Budget - Ledger Sheets - Balance Sheet - Budget Compared to Actual M 1-5 SAMPLE ELEMENTARY PTA – Computerized (Quickbooks Software) - Account Listing - Budget - Balance Sheet - Profit and Loss Actual to Budget N Record of Receipts / Cash Count Form 29
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2008 Award Winners SEAFOOD BAR OF THE YEAR 2008
Mary Ann's Bar & Restaurant
Our Seafood Bar of the Year is little short of a national treasure - a pretty west Cork pub that is as old as it looks, going back to 1846, and has been loved and well maintained in Fergus and Patricia O'Mahony's energetic and hospitable ownership since 1988. Seafood is the star, of course, in both bar and restaurant – and it comes in many guises, usually along with some of the lovely home-baked brown bread which is one of the house specialities.
Another is the Platter of Castlehaven Bay Shellfish and Seafood - a sight to behold, and usually including langoustine, crab meat, crab claws, and both fresh and smoked salmon. Although there are also good steaks and roasts, served with delicious local potatoes and seasonal vegetables (and delicious local West Cork cheeses to folow), much of the menu depends on the catch of the day.
But one of the most appealing things about Mary Ann's is that such a wide choice is available in the bar as well as the restaurant – and that includes daily blackboard specials, which may offer real treats like lobster thermidor or lobster mayonnaise, as well as a long list of other seafood. Some bar food indeed!
Show me all 2008 Award Winners
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