EIN stands for Employer Id Number, also called Tax ID number. The EIN can be compared to an individual's social security number - it is a unique identifier for a group, nothing more. It is often also called a "tax exempt number", but having one does not automatically mean your PTO is exempt from paying tax.
Like DaveP said, the only way your PTO is actually exempt from paying federal income tax (and state sales tax in most cases) is to be a federally registered 501(c)(3) non-profit organization. While it is a fairly in depth application, many PTOs are filing and successfully earning their 501c3. There's lots of info about that process on this forum, in the Start Up Guide that comes with NPN membership, and in PTOToday magazine including the October 2003 issue.
Regarding carryover, there's no rules. The amount your PTO carries from year to year is a decision for your board and members. Our bylaws require that we carryover a minimum of $2000.
The EIN will serve as your tax exempt number only upon approval of 501(c)(3) status by the IRS. Section 501 deals with tax exempt organizations and the who, what, when and hows. You need IRS Publication 557, see this web sites useful resources. You will also need to know your state laws concerning tax exemption and about incorporation.
Dont feel bad either a lot of organizations that are not for profit think that the EIN makes them tax exempt, it is I have found a common mistake.
I am looking for a little help and advice. Our PTO obtained and EIN # years back. It is my understanding that this also serves as our tax-exempt number, correct? I am a first time PTO Pres. and have been getting some mixed signals from our past Pres. regarding the carry over of funds from school year to school year. Is there a limit to what can be carried over? If so what? We are fortunate to have a very healthy financial base from which to provide our students with field trips, programs etc., but I have many concerns about the remaining funds at the end of the year. Typically we only do 1 major fundraiser in the fall and some small "fun" events to raise money all year long. If the carry over of $$ is not an issue than perhaps that could change things for us at the beginning of our next school year with regards to fundraising. Any help here would be greatly appreciated. Thank you.
