Yes, complicated! I think there are two different issues. First, the question of whether there are financial improprieties going on. Second, what to do about the lack of IRS reporting by the group. Those two things aren't necessarily related. It's not terribly uncommon for parent groups to lose track of federal filings. It's a consequence of turnover and not having a transition plan in place. The result is that the group loses its federal tax-exempt status. The solution is to refile or to file for reinstatement. Usually, refiling is easier, I believe.
As to whether there's something fishy going on with the finances, the question is what kind of financial controls are in place. Is the group doing an independent review (audit) of its books each year? Is someone other than the president (or treasurer) reviewing the bank statements each month? Those are probably the two most important steps to protecting a group's finances. (Check the group's insurance policy as well to see whether you have theft / embezzlement coverage.)
If there are no controls in place and the group's finances aren't transparent, I'd suggest starting there. Call for a review of the books -- you might get an idea from the president's reaction whether or not there's something to worry about.
Good luck, and please keep us posted on how things go.
Hello all. Looking for some advice. My step-son's PTA organization is run by one of his family members known to me to be of questionable financial character (because of court documents with numerous financial indiscretions listed, as well as some private information). I suspect there was never a background check done by the school on this person.
I've often wondered over the last couple of years if this person, who has access to PTA funds for the school, has been involved in activities that may not be on the 'up and up'. I have no definite proof of anything yet, just a hunch (based on personal experience with the person).
I started digging into the IRS forms that the organization is required to file, specifically the 990 forms. What I'm seeing, at least on guidestar.org, is that there seems to be no record of any 990 forms filed since 2009. This timeline has some correlation to said family members involvement in the PTA (both as president and treasurer).
What I plan to do next is file a 4506-a from the IRS to see information after the 2009 tax year. I'm not sure if it actually exists or not, but I plan to find out. If it does, I look forward to seeing what is in it. If not, not sure what to do next except perhaps find a financial attorney.
What experiences do folks have with dealing with a situation like this? What advice would you have for next steps?
In 2009, records show the PTA took around a $2000 loss for the year. Fast forward to 2015, and this PTA has fundraisers seemingly all of the time, with what looks like no readily available record of where money is going and how it is taken in. They are kicking off a big fundraising effort the second week of school this year.
