$5000 is a guideline, not an absolute. You might want to think hard before becoming a 501(c)(3) because there are compliance and reporting issues. In addition, you have to have volunteers willing and ready to put it all together and see it through.
Have you actually talked to the school about opening an account and including it under their umbrella? If the school is private, they may be willing to do that. I have also known some public schools to do that. You would be considered a supporting organization. You would have to account to the school, but would not have the added administrative expense.
Secondly, you could informally form a PTO or PTA as an outside support group. You would not have to be an non-profit, but you should file tax returns and would be restricted in the amount you could directly donate in cash. However I have worked with a group who did just this and supported a non-profit that I worked at. It worked and they are still around after 20 years.
Talk to the school and work with them. If they are not willing to work with you, go independent. If you spend all your income, you will not be taxed.
We have the exact same issue! No kidding! For the last five years or so our account has been held with the school which was held by the school district! UGH! Feel lucky you only have to wait a couple days at the longest! Our business office would take six weeks to cut you a check! I will have to admit, the popcorn machine was a great buy but I woulkdn't have thought twice if I was the seller. Shoot, I've seen parents upset when they made a purchase and asked for reinbursement (sorry cold and can't spell) and was not given the $1something in taxes! anyway...
Now we did get our own account this year but that is only because the school (it is a charter school) is having major issues with the school district (too long to post) but we still don't bring in enough to file for non-profit. Just make sure if this is something you really want to do it's done on good terms with the school and (JHB would you agree?) if you are moving your money, ALL of the funds should be moved and you can open a playground account and a PTO account for your own use.
It's how much money comes in to your ORGANIZATION. If you are raising the money on behalf of the school - so technically, it goes under their control, then it shouldn't count. But if your group controls it - earmarked for a longterm purpose or not - then it's still your revenue.
I guess I didn't totally answer your question did I? We raise more than $5000 a year, however 90% of it goes into our playground fund. Only about $700-$1000 a year goes into our general account. So only the latter would be in an external account.
The problem I have is not with having to turn in an invoice, but that we have to turn in an invoice for EVERYTHING. Example: We wanted to purchase a popcorn machine from a yard sale, and had to ask the people to write an invoice so that we could get the $100 out of our account. (It was really embarassing.) Also, we can not just walk in with an invoice and get a check, we have to wait at least one day usually more to get the school to cut us a check. The problem also is that during our schools annual audit they won't write checks. This year our account was frozen for nearly 3 monthes. Last year it was about 2. The majority of our money goes into our playground fund which we would like to keep internal. It is our general fund that is in question. The bank told us we could use the schools tax id number as we have been, but I don't know if that is true. For the little amount that we spend, I question if we even need to be tax exempt. We have less than $2000 in our general account. We never have more than that.
The general rule of thumb many of us have been given by the IRS is that if you have more than $5000 per year GROSS receipts per year, you should go through the steps to set up as a qualified non-profit - 501(c)(3).
That means adding up everything that comes in to your account for the year in the ways of fundraisers, t-shirt sales, membership, etc. - not just how much is left over or what your average balance is.
Is the issue (with your school accounting office) one of documentation or does it take a long time to get the funds? The reason I ask is that any PTO with good accounting practices would have the same requirement. A PTO treasurer would not issue a check unless presented with an invoice or proper documentation.
