I am not a lawyer, but I believe that failing to hold elections would jeopardize your tax-exempt status. For one thing, it may require you to falsify forms you must submit to the IRS each year to maintain your status, and lying to the IRS has never seemed very smart to me.

In addition, failing to hold elections almost certainly would violate state law. I don't know what state you're in, but most states require nonprofit corporations to have certain specific officers, usually a president, secretary and treasurer. The only authority for filling those positions is the bylaws. Thus, if your bylaws call for elections and you don't hold them, legally you have no officers when the terms of the current officers expire. That in turn would mean you have no one authorized to receive or spend money or take any other action on behalf of the PTO. In some states, if the violation persists for some years, it would mean automatic dissolution of the organization (which would certainly eliminate your tax-exempt status).

Our bylaws state: The PTO is classified as a public charity under section 509 (a) (1) and 170 (b) (1) (a) (vi) of the Internal Revenue Code. In addition, the PTO is tax exempt under section 501 (c) (3) of the Internal Revenue Code; and further contributions to the PTO are deductible under section 170 of the code and that the PTO is qualified to receive tax deductible bequests, devises, transfers or gifts under sections 2055, 2166, or 2522 of the Internal Revenue Code.

If your PTO has any official status at all -- 501(c)(3), LLC, registered with the state, anything -- then canceling elections is almost certainly illegal. And the principal saying it's OK to cancel them isn't relevant in any way, unless your bylaws specifically say that the principal can cancel PTO elections. (If they DO say that, you need to revise your bylaws!)

I've never yet seen bylaws that authorize any person or group to cancel elections. Officers and the board have only the powers specifically granted them by the bylaws.

Depending on how strongly you feel about this, you could:
a) Warn the president that canceling elections puts the PTO's legal status in jeopardy and could make it illegal for the PTO to raise or spend money.
b) During the meeting at which elections are supposed to be held, make a motion to hold elections in accordance with the bylaws. If someone seconds it, insist on discussion and a vote.
c) During the meeting at which elections are supposed to be held, ask the president to cite his or her authority for canceling elections. This can be done as a point of order and does not require a second or a vote.
d) Hire a lawyer, though I hope it doesn't come to this.

Did they announce that they will not be having a election? And I dont know about going to the principal. Usually you should speak with the PTO President who then speaks to the principal, if elections are not being held then I would assume that they okayed it with the principal.

I would talk to your principal.

Out PTO has decided not to hold elections this year. Our bylaws state that elections are held every year. Several parents are not happy with our current board and want to get involved. However, how can we when they do what they want and don't follow the by laws? Any advice?