My personal recommendation would be that you work under their umbrella with a clearly documented agreement of what the boundaries are, who makes what decisions. In your situation, I see no benefit in setting up your own 501(c)(3).

Natually they will want a say, but you don't want to be micro-managed. When you raise funds, you want assurance they will be used for the jointed defined purpose stated in the beginning. Documenting decisions as you go will be important.

If the PTO needs a little financial independence, set up your own EIN and bank account, but run less than $5000 through it so you can stay informal. When you run the big fundraisers, raise them on behalf of the school and deposited with the school. That way contributions are still tax deductible, but you can remain an informal association.

Oh and yes it is a Christian school that already has an EIN and 501(c)(3) status.

Wow! You're quick! I'm not sure what we are. I had a meeting and stated that I think the goals of our group MUST be fundraising and teacher morale. We are lacking severly in both areas. Our teachers have basically had their pay cut in half this year, we've lost 4 teachers, some of them are having to work second jobs, etc. They need a new playset (ours is falling apart and the kids are getting bad splinters), our copier is horrible (very light and has a line down the middle). We got trailers for the upper school kids this year and now they need lockers. I'm trying to literally clean up the school. (redoing bulletin boards, sweeping the floors, etc. We have no janitorial service or lawn service, the teachers and a couple of parents have been cleaning the bathrooms and mowing the grass in the past. This is my first year at the school. I've seen almost 20 students leave this year b/c of the extended time it took to finish the trailers, therefore, we lost all that tuition. I want to help the school and not just walk away from it. It's not fair to the other children, plus it has the potential to be a good school, it's just having a very, very rough year. I want to put the money into the school but I feel we will get a better parent turnout/support if they know we have some control of the money. The school has a lot of parents that aren't happy right now and this is their way of having a say in things. I made it very clear at my mtg that we were not there to have a gripe session and we were not there to change school policies. We are here for support and leg work, really. I just worry about the board wanting to control our every move. They have tried to start a PTO there in the past I guess and I've heard rumors that there were board members(who were also parents) that would always do the whole "well, the board won't approve that, you'll have to get permission from the board, the board...." you get this picture. That pretty much knocked the parent's moral down to where the teachers are. After hearing that I feel that it would be best to be separate. I'm feeling like I'm in over my head and maybe over extended myself.

Important note - if your school is not a non-profit/charitable org, your PTO will not be a either unless it is independent and you pursue that status.

Among other things, you really need to know:

1. What is the goal of your group?
2. Will your group be independent of the school or more of a specialized committee under it's umbrella?
3. If you are independent, will the funds from major fundraisers belong to the PTO or will the PTO be more the volunteer organizers and the funds deposited with the school?

With a private school, the PTO often acts more like a committee and may do fundraising for items outside the role of the "typical" public school PTO. (My friend's group raised money for tuition scholarships, a new A/C, roof repairs, salaries as well as additional programs, supplies, field trips.)

If you are an independent organization, you do need your own EIN and bank account. As an independent group, if you are likely to have more than $5000 coming into your accounts (from all sources), then you are expected to formalize and file for 501(c)(3) status by filing the 1023 application form. With less annual gross receipts, you can operate less formally and still be considered tax-exempt by the IRS, assuming you are following all their rules.

If you are an extension of the school, then you operate under their umbrella and your finances should be accounted for as one of their programs.

Here's another discussion that explains some of this.

Let us know more about what your organization is and we can help answer more questions.

I hope I don't ramble too much. I've just started a PTO at a small private school of less than 100 students, K3-12. I have no knowledge in this area and thought my solution was to open a PTO bank account using the school's 501 status and EIN #. We have a banker that said I could do that. However, a board member (who is also a parent) has paid her dues and is now asking the secretary (of the school) what I am planning on doing with the money since I can't open an account until I take it to the next board meeting on Feb 11th. I am afraid that they will try to keep very tight reigns on me and the PTO if I do it this way. Can someone give me a "brief" explanation as to what is involved in getting both of these things. I've heard there is a pretty high fee to get the tax exempt status. We have no money since we just started, although we did go with a $5 dues to get some start up money. I want desperately to be successful at this but didn't realize all the "legalities" that would be involved. I am swamped with college and kids and everything else we parents get buried in. ANY direction you can point me in would be SOOOO appreciated! Thanks!