Yeah, I'm with Jon on being skeptical of your CFOs advice. I've heard lots of admin types recommend the same thing, but not many of them actually have their ducks truly in a row.

If there is a group determination in place - great. That will save you dollars and time. (If there is, I still recommend running your books independently.)

But I'm guessing there probably is not, and that would make your CFOs recommendation sketchy, at best. Ask to see the paperwork on your status (or just inquire some more nicely). If I'm correct, then perhaps you can get the other groups in town together and go for the group exemption. You can spread the cost out nicely that way.

Tim

mum24 has a very good point about being leery about keeping your funds in the "school account". I'd be cautious about the school having so much control over your funds.
I would also question the districts umbrella. The district had to have filed for a group exemption in order to have an umbrella. Ask for a copy of the determination letter for your own treasurer's records. If the CFO is unable to produce it, I would think twice about being covered. In our district of 14 schools, ours is the only PTO that has it's own determination letter from the IRS. I think the work necessary to apply is well worth it.

Sounds like the district CFO has some experience with this with other PTOs in your area, so his advice is probably the best. I'm guessing that he has a group exemption set up, where all he needs to do is file your tax ID number with the IRS, and you'll automatically fall under the district's exemption. He's also right in that you will still need to file your own 990 if your gross receipts exceed $25k (no getting around that one...).

The thing I would be concerned about is the requirement that you keep the funds in a "school account." I'd get some more details from him on that in terms of what kind of control you would have over the money vs. what kind the district would have. There is probably some sort of agreement that would need to be signed between the PTO and the school district that would spell all this out.

Can you call other PTOs in the district and find out how the arrangement works from their perspective? If they have had any problems with it? If they are run significantly different from your PTO? If what they tell you is something you can live with, falling under the district's umbrella is probably your best option.

If you don't want to go that way, though, at least the filing for exemption is a one time event! Once you get through it, you'll never have to do it again.

Recently our PTO found out that, because we have gross receipts of over 25K per year, we should be filing the informational form 990 with the IRS. We have no record of ever filing for 501c3 status with the IRS, although we do have our own tax ID number. We are not incorporated. The CFO of our school district said he recommends that all of his PTOs stay under the school umbrella (i.e., keep our funds in a school account), and then we don't need our own tax exempt status. However, he says we still need to file form 990 if we make over 25K. As in any PTO, our board turns over often. The thought of filing for 501c3 status is rather daunting, not to mention the expense. Does anyone have any suggestions for us? We have a big silent auction planned for next fall so we need some answers. Thanks in advance!