Hello everyone. At our school we "give" each teacher $11.00 for each child in their classroom. so if they have 16 students they get $176 for the school year. To get this money they need to fill out a check request form - for field trips - or a reimbursement for - with receipts - for supplies that they have already bought. It really does not have anything to do with the trust issue it's more for keeping good records incase there is ever a question as to where the money went. As treasurer I have to tell you that this makes my job a lot easier and it makes the yearly audit of the books go smoother too!! [img]smile.gif[/img]

I asked my principal if she could find the references for the gift limit. She did some research and said that as far as she can tell it is strictly a district policy. She had been given the impression it came from higher up. So it may be that you don't have to check with your state, but you should definitely check with your school district and the IRS rules. Also, (from my tax lady)the teachers would have to declare these gifts as income. I still think it would make a great article-details on requirements for 501-c-3 and those receiving the money and discussion of the pros and cons.

Tim and others,
I am in Iowa. The principal told us about this "rule" from the very beginning. It doesn't just apply to the PTO-she reminds all parents of the policy in her newsletter around Christmas time so they all know when they go out to purchase gifts. I know it's not just something our principal made up either because all the schools in the district follow this policy. I can see the point of the rule-not being able to give teachers large gifts that may influence the treatment your child receives in the classroom. It can make it difficult for parent organizations to find a simple way to distribute funds to their teachers, but we have found a way to make it work. Frankly, I want to know that the funds we have all worked so hard to raise are going to benefit the children. Let's face it, while the vast majority of teachers are going to use the funds for their classroom, there is always that one person who has other ideas. My guess is that is probably what started the whole "limit on gifts" rule in the first place. I'll be fascinated to see if any other states have the same policy or if we have been misled(although I don't think that will change the way we handle our Teacher Fund). I'd be happy to help in the research if needed.

We used to give our teachers a lump sum gift, too. But when we filed for 501(c)3, the IRS advised us that we needed to require receipts from the teachers since otherwise we couldn't guarantee the money was being used in accordance with our mission and non-profit restrictions. Also, since the amount allocated is a substantial portion of your total budget, it's especially important that your PTO can "prove" the money is being used properly.

So...we give our teachers a pre-printed envelope in June (so they can collect summer receipts), and tell them that we won't even look at the receipts, much less audit them. When they turn it in, we seal the envelope and issue them a check.

At our school we give teacher funds as a lump sum to the school. Teachers must fill out purchase orders and be reimbursed by the school. This way the principal knows what teachers are spending the money on, and has adjusted his budget to help in areas the teachers commonly need help with. For example, third grade teachers all bought a certain set of flash cards; he approached all the teachers the next year to see if this was a common need, and was able to purchase a larger quantity at a discount. All organizations must be accountable to their membership for funds they spend. Non-profits are no exception. If you explain that to your teachers, they should understand. It's not personal!