What we do is, at the beginning of the year the teachers receive a cute poem, (when I find it I will post it,)_ that says that we are "gifting" them $50. It is just a piece of paper. They then turn in receipts and they then get a check from us. We have a paper trail and they are then able to get whatever they need. You do need to check the receipts though, one teacher turned one in for a microwave. Last year they got an additonal $50 for participation at the carnival. We did it the same way.
We also do something called Adopt a Class. I don't know if everyone does this or not. What it is is a parent or parents gift money directly to the teacher for classroom supplies. They get a certificate for themselves and the classroom and they are also invited to our end of the year Appreciation breakfast with the Volunteers and Business Partners.
At our elementary level, each school has what is called grade level accounts, then broken down by teacher. It's where monies are deposited for them to purchase supplies, fund field trips, etc. Someone in each office is responsible for the record keeping, paying P.O.s, etc. We "deposit" money into each teacher's account. We "say" it is for transportation costs for one field trip and a certain amount extra for supply ordering. But, they may use it for whatever school-related items they choose. We write one check per year, it is a line item on our budget, no more paperwork, very easy, and it's over.
Our PTO collects all the money at every event. We give the teachers checks for expenses that are pre-approved at our meetings. We must have teachers to help out or the events won't happen. Also for insurance purposes we must have a school employee at all events.
If your teachers are collecting the money and using it without it going through your checking account, that might be the problem.
Our school district has hired a financial consultant who claims our PTSO is in violation with several of our financial proceedures...such as teachers not being allowed to particapte in PTSO sponsored fundraising events such as Movie Night, Fall Festival Booths all of which provides a way for teachers to earn much need funds for classroom fieldtrips, supplies, etc... How much say do school district representitavies have over Parent Teacher Student Organizations as our Board is very diligent about collecting receipts to account for all monies dispersed???
But if it's considered a "gift", then you may be violating IRS rules about benefiting individuals, and it's also possible the teachers should each declare it as miscellaneous income.
In my mind, these mini-grants are and should always be considered reimbursements if the intent is to supplement classroom materials and supplies. The school is still the recipient, but each teacher is the "agent" of the school for his/her particular classroom.
The IRS considers gift cards the same as giving cash because there is no accountability. Companies have to be really careful in regards to employees. For instance, if the company gives all employees a Turkey or Ham at Christmas - that's fine. No big reporting needed. But if they give all employees a giftcard, that counts as income and taxes are due.
I realize that teachers aren't employees of the PTO, but I think similar reasoning prevails.
I deeply respect our teachers and am in great favor of teacher appreciation activitities. But as a parent I would be against giving every teacher in the school a $100 gift to spend however they choose. I realize most teachers would undoubtably spend it (and more) for the classroom, but the PTO has no control at that point.
The IRS wants accountability of funds dispensed for a charitable purpose. I don't think you can achieve that with generic gift cards.
