Booster ClubsPTAClass of 2009

You are an officer – NOW WHAT ??

Three Primary Responsibilities

1. Pay close attention to what’s going on and make decisions based on good information.

Three Primary Responsibilities

2. Put the welfare of the organization above other interests when making decisions.

Three Primary Responsibilities

3. Act in accordance with the mission and goals of the nonprofit organization.

Steps to secure nonprofit status

A purpose A name Officers Form of organization Governing documents

Form of organization

Nonprofit association Nonprofit corporationSeek competent legal advice to make this

decision.

Governing Documents Nonprofit association Nonprofit corporation

Articles of incorporation Bylaws

Seek competent legal advice.

Steps to secure nonprofit status

Federal Tax Identification Number

IRS Application for exemption

State Application for exemption

Sales tax permit

Federal Tax Id Number Form SS – 4

www.IRS.gov

Can be filed Online Telephone Fax Mail

IRS Application for exemption Form 1023

within 27 months Filing fee

$300 if <$10,000 $750 if >$10,000

Publication 557 Seek competent tax advice

IRS Application for exemption

Public disclosure requirements Form 1023, and All supporting documents Any letter or document issued by the IRS with regard to the application

IRS Application for exemption

Already exempt and need a verification letter? (877) 829-5500 or write toInternal Revenue ServiceEO Customer Account Services

P.O. Box 2508Cincinnati, OH 45201

Texas Application for exemption

PTA No application form

Texas Application for exemption

PTA Affiliated with state association?

Yes – Send Letter from state association acknowledging affiliation

Cover letter requesting exemption

Texas Application for exemption

PTA Affiliated with state association?

NO – Send Cover letter requesting exemption

Statement of operation as NPO Schedule of activities

Texas Application for exemption

Other PTOs No application form Send

Cover letter requesting exemption

Statement of operation as NPO

Schedule of activities

Texas Application for exemption

Booster Clubs First - MUST have federal tax exemption

Then - submit AP-204 with copy of federal determination letter

Additional documentation listed on AP-204

Sales Tax Rules Texas Administrative Code Title 34: PUBLIC FINANCE Part 1: COMPTROLLER OF

PUBLIC ACCOUNTS Chapter 3: TAX

ADMINISTRATION Subchapter O: STATE SALES

AND USE TAX

Sales Tax Rules

Rule § 3.322 Exempt from sales and use tax on purchases for the organization’s own use

Sales Tax Rules

Rule § 3.316 NOT exempt from collection and remittance of sales tax on items sold

Exceptions: Rule §3.316 Meals and food products Annual banquets or suppers NOT professionally catered

Amusement services Membership dues Publications

Exceptions: Rule §3.316 Auctions, Rummage Sales and Other Fund Raisers: Exempts occasional sales by persons not in the business of selling, leasing or renting

Exceptions: Rule §3.316 Auctions, Rummage Sales and Other Fund Raisers: Allows for two (2) ONE DAY sales during any 12 month period

One day sale is literally 24 hours.

A two day sale uses both of the allowed annual one day sales.

Exceptions: Rule §3.316 Fund raiser in which items are sold over a period of several days or weeks Exempt if there is ONE collection date for turning money in.

Qualifies as one of the two allowed annual one day sales.

Exceptions: Rule §3.316 VERY IMPORTANT that there only be one collection date for turning the money in or the entire fund raiser becomes subject to sales tax!

Sales Tax Rules Already exempt and need a verification letter? Exempt Organization Search:http://window.state.tx.us/taxinfo/exempt/xmptsearch.html Request for Verification online: http://www.window.state.tx.us/taxinfo/exempt/xmpt_ltr_req.html

Sales Tax Rules

Application for Resale Certificate AP-201 http://window.state.tx.us/taxinfo/taxforms/ap-201.pdf

Annual Federal Reporting

Form 990-EZ or Form 990 Not required if annual GROSS RECIEPTS < $25,000

If filed, must be available for public inspection

Form 990-EZ

Annual Gross receipts <$100,000 AND

Total assets <$250,000 Seek competent tax advice

Form 990

Annual Gross receipts >$100,000 OR

Total assets >$250,000 Seek competent tax advice

Form 990-T

Annual Gross income from unrelated trade or business >$1,000

Seek competent tax advice

Loss of Exemption

Public disclosure requirements Form 1023 Form 990-EZ, 990, 990-T Can charge for copies

$1 for 1st page .15 for each additional page

Loss of Exemption

Political activity Excess benefit Private inurement Intermediate sanctions

Loss of Exemption

Prevention: Adequate books and records

Policies and procedures Continuing accountant or lawyer

Accounting

Adequate books and records Board meeting minutes Check register Reconciled bank statements Income records

Chart of Accounts

1 Assets – what you own2 Liabilities – what you

owe3 Fund Balance – what’s

left4 Income5 Expenses

Policies and Procedures

Internal controls Board meetings & minutes Reporting requirements Separation of duties Training of new officers Continuing accountant or lawyer

Software

When do I need it? Reporting 990

Recommendations QuickBooks