Q&A

Exempt purpose and Form 1023 questions

Our purpose is to enhance and expand the educational, social, and cultural opportunities and experiences for (our school). We included social to be able to explain how Breakfast with Santa is part of our purpose; however, in reading some of the rules it sounds like social activities aren't charitable. Help! How do we get our purpose to be considered charitable while including Breakfast with Santa, Spirit Wear sales, Skate Day, honor roll parties, etc. Also, on form 1023 I'm having trouble determining if we provide good, services, etc to individuals and organizations. Teachers can request funds for classroom supplies so I don't think it counts as funds to individuals or organizations. Thoughts?
- msnethen

Those activities are part of building community and support for your school. They will be covered under your tax-exempt status whether or not you have the word "social" in your statement of purpose.

Regarding providing goods and services to individuals and organizations, the answer is yes, you do. For a parent group, the “individuals” referred to in this question typically are students, teachers, or other people closely related to your group. In an attachment, concisely describe each program of your group that provides goods, services, and funds to these individuals. Do the same for "organizations" (the school) in question 1b.

For the follow-up questions, no you would not be selective in providing those services and yes, people in your group would naturally be related to people receiving those services (students). Attach a brief explanation of that relationship.

As you go through this process, I would strongly recommend our PTO Startup Toolkit. It walks you through form 1023 question by question, with explanations and appropriate answers.

Good luck!
- Craig
Links in this post:

PTO Startup Toolkit: https:/classic.ptotoday.com//startup-guide

Thank you, that's very helpful! You get into this 1023 and wonder if you are making it too simple or too difficult sometimes! Our PTO is voting on purchasing insurance with the plus membership this week so I hope to have the Toolkit very soon. Again, thanks for the advice!
- msnethen
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