Found this topic interesting. Checked into it for our middle schools.
IRS Publication 557 pertains to this.
IRS for Exempt Organizations: 877-829-5500.
After calling the IRS it sounds like any group that goes under the initial one has to pay the $150/$500 fee.
Tim - We continue to move forward in establishing PTOs (6) throughout the district. We have formed a district-wide group which will serve as our umbrella for non-profit status filings. My question is, the district group which is comprised of reps from each of the 6 schools, has very little gross income during the course of the year and therefore is eligible to apply for non-profit status at the reduced rate of $150 (income less than $10,000). My concern, however, is that when applying for group ruling for the 6 schools to come under the non-profit status, will it be an issue because they DO exceed the $10,000 gross income figures? Is there something I'm missing in this filing process? We are looking at the district group as a separate entity with its own EIN and Articles of Inc. but maybe that will come back to hurt us in the non-profit filing dept?
Thanks,
Patti
Filing as one unit will save you some fees and some work, as Tim explained. But you have to be sure that your council stays intact as a coordinating body and that everyone agrees to the same basic infrastructure and processes.
You all need to agree on good accounting practices, a common way you will track income and expenses, and who's going to enforce this (i.e., the council).
It should be less work and more security for everyone if you work as a cooperative, but all six units do need to be willing to comply with the ground rules. (A very fair trade off, from my perspective.)
I'd recommend filing as one unit. There are several reasons for this, the best being that you'll pay 1/6th the price for applying and have to do 1/6th the paperwork.
You can file this way and also allow individual units to have own bylaws. It can be a quite flexible structure.
Give us a call and we can help you walk through it. 800-644-3561.
What you're doing -- making the switch en masse as opposed to one group at a time -- is a great way to go, as you'll still be able to retain the nice benefits of a local council (share ideas, schedule fundraisers that don't conflict, have a structure for connecting easily with district...) and you'll actually save more in dues than an individual group. All told, your 6 local units are probably spending north of $6,000 per year in state and national dues.
We are a district of 6 schools (k-12) and are currently operating as PTA. We have a district-wide area council that oversees each of the PTA units. Does anyone have any recommendations as to whether when converting to PTO we should each file independently as 6 PTO's or could we continue to operate under one town PTO with 6 separate branches? Would there be a benefit to one option over the other? Could each school have their own By-laws as they do now?
