Thanks Critter:

I appreciate your quick response. I don't think the major complaint with this PTA is the dues to the state. Our fundraiser generally does very well & we utilize that money directly to benefit the school (purchasing suppplies, equipment, new gym floor etc.). We have a small membership so there isn't much money going state dues anyway. The main complaint they seem to have is with the business requirements and they find it cumbersome to have dual signatures on checks.

I want them to understand that many of those requirements do not simply vanish just because they become a PTO instead of PTA. They will still have the IRS requirements, they still need their checkbook audited annually, and it will take some time (& a little money) to establish a new corporation & tax exempt status. I believe that most insurance companies would also require dual signatures.

Thanks for your assistance!

You're right about the non-profit status and form filing. If your PTO grows to be over $5000 in gross receipts per year, the IRS expects you to file for 501c3 tax exempt status. Depending on your $ size, the one-time fee is either $125 or $500. Once granted 501c3, there are no actual taxes due, but you must file the annual tax form to the IRS. The organizational responsibilties of an independent PTO are different from a PTA unit, but they are very important and shouldn't just be ignored.

From what I've seen (and I've never been a PTA member), the #1 reason PTA units consider dropping their PTA membership is the $dues issue. Your board needs to do some more research (here on this website is a ton of info on PTO/PTA) before leading a discussion on the possible change.

Oh...by the way...dual signatures on all checks isn't a pain....it's a necessity - PTA, PTO, or Neighborhood Homeowners Association!

Our PTA Board members wish to change to a PTO and list the following reasons:

Requirement to send dues to State PTA, without seeing benefit; State PTA is requiring more paperwork, including yearly & quarterly reports, dual signatures on checks, and filing paperwork with the IRS; State PTA wants us to focus on programs and not fundraising and this is not a reality for us.

The Board members listed that if we became a PTO:

Our dues would stay at the local level; Our bylaws would govern us but we DO NOT have to file reports and/or tax forms; Fundraising would continue to benefit our children, teaches, and school.

I feel that this is gross misinformation. I know of no organization that can do fundraising and not have to file tax forms. It is my understanding that we would need a whole new tax id#, and file for tax exempt status (I'm not sure if there's a fee for this). Regardless of whether or not we become tax exempt, won't we still have to file tax forms?

I'm looking for some information to reply to this "voting" flyer sent out by our PTA Board. I also don't think they can just dissolve our PTA with a generic form sent out to all school parents.

Need help in little-town, VA.