If your PTO is really a free-standing 501c3 (and not just operating like one), then when you incorporate, in the eyes of the IRS you have just created a brand new organization. That brand new organization would need to refile for its 501c3 status. I would definately ask more questions about the board's purpose in this. Reading between the lines looks like the board wants more control than perhaps you want to give. Are they putting your PTO under their tax id number? Be cautious.
I am in an k-4 bldg w/ active PTO. We have our tax-exempt status but have not incorp. The district has approached all district PTO's about incorp. We have a meeting scheduled with an attorney they chose. The sample doc we have states that the District treasurer will be named agent and then they have added the following paragraph
"Subordination
The Corporation shall be subordinate to, and subject to the authority of, the board of education of the local school (name ommitted)."
Somehow, I'm feeling this is slightly shady and don't want to have anything to do with this? Any comments (I'm VP and our other bd members are wondering as well - we would like to incorp - just do it on our own and keep them out of this)
We've never had problems with them before so wondering what this is about - they have volunteered to absorb the cost of tax filings - but I'm not sure it is worth that.
I'm just curious as I go to this meeting what everyone else my think? about the agent? about the subordination clause?
