One more thing I wanted to add is that I think our accreditation association required our Parents' Club funds to be administered by the school. Actually, it makes life easy on us, because we don't ever have to write checks or create financial statements--all of that is done for us by the school bookkeeper/business manager. We have all of the control as to how our money is spent, although the school would love it if we handed all of it over, no questions asked!
Shelly
We have just come to a compromise regarding this. Our account was one of those that was a separate account with its own EIN but no non-profit status. I met extensively with an attorney and discovered that (at least in our state) you can have a separate account with the same EIN and maintain "dual custody" of those funds. This allows us to maintain control and accounting without having our own 501(c)3 status and all the paperwork,etc to go with it. We finalized a memo with our board outlining the proper procedures, etc. It hasn't gone into effect yet, but hopefully it will work.
There has been a big move in Catholic Schools over the past couple of years to make PTOs liquidate their checking account and turn the money over to the main bookkeeper for the church/school. Our school was one of those dealing with the issue.
When your budget is substantial (ours was about $60,0000/year) and access to the cash is left solely in the hands of volunteers, trouble sometimes follows. The move to take over the PTO checking account puts that money into a paid and trustworthy accountant or bookkeeper for safekeeping. That person or entity merely keeps the money but makes no decisions about what your PTO will do with the money.
As long as your PTO has a clear understanding and the bookkeeper is on the same page as you, you are doing great...think of the bookkeeping office as your PTO's bank, and you'll be able to deal with it.
Just be sure to write something in your constitution and/or by-laws protecting you from infringement by the school administration and bookkeepers.
thanks for your responses. I've only been to 2 meetings, I think they have an independent bank account... I mainly was curious, not really wanting to rock any boats. (at least not right at the moment as the "new" people [img]smile.gif[/img] maybe later [img]smile.gif[/img] maggie
Our private school is affiliated with a church so basically the school is part of the church and the Parents' Club is part of the school so our checking account is run through the school by the school bookkeeper and business manager.
Shelly
The rules are the same - they are governed by your state laws and the IRS.
Basically if the PTO is independent, if money flows through its bank account separately from the school, then yes - it should be set up with its own ID.
However, if it merely acts a volunteer arm of the school and funds flow through the school's accounts, then it's not separate.
Either way can work, and with private schools it is not uncommon for the parent group NOT to be a separate entity.
It's also quite common that parent groups just operate on the sly, sort of independent and controlling their own funds, but never formalizing and getting their own ID's. Those type aren't operating according to the rules - but lots do it.
