Information for Parent Groups
Donations to the District
Cash and In-Kind Donations
Both monetary and in-kind donations need to be formally recognized on the Request for Approval of Gift/Donation Form at the school the outside organization supports. Examples of in-kind donations include food, shade structures, teacher supplies, playground equipment, marquees and other tangible gifts.
Donations to Staff
Checks should not be written to school staff to support classroom projects and school activities. Instead, the donation should be made to the school with the funds being restricted for the supporting organization's intended purpose.
Legal and Tax Issues
Parent orgnanizations may consider incorporation to provide a legal shield against certain liabilities that may pass through to the officers or members of the organization. Nonprofit incorporation also serves as the foundation for the organization to apply for tax-exempt status. If a parent organization chooses to pursue this option, the organization will need to contact the Arizona Corporation Commission (ACC) as well as draft articles of incorporation, by laws and possibly annual filing with the Arizona Secretary of State.
A parent organization can complete an I.R.S. Application for Recognition Exemption (Package 1023) to be recognized as a 501(c)(3) organization. "Parent-teacher associations" are specifically cited in the I.R.S. guidelines as examples of organizations that are suitable for 501(c)(3) tax-exempt status.
Tax-exempt status offers many advantages including:
1. The organizations revenues will be exempt from federal and Arizona income tax.
2. Contributors to the organization are permitted to take a charitable deduction for donated cash or goods.
3. The organization is eligble for a bulk-mailing permit from the U.S. Postal Service.
Small charitable organizations are not required to fill out a 501(c)(3) application if their gross receipts are normally less than $5,000 per year. It is recommended that parent organizations or Booster Clubs visit the I.R.S. website at http://www.irs.gov. to review Publication 557 - Tax-Exempt Status for Your Organization and Publications 4220 and 4221 to see what tax filing requirements may apply to parent organization or Booster Club.
Outside Groups Using Peoria Unified School District's Tax Identification Number
All Booster Clubs, PTSOs and PTAs are legally separate entities from the Peoria Unified School District. The organizations need to have their own bank accounts and taxpayer identification numbers. Parent groups cannot use the district's taxpayer identification number.
Reimbursements for Purchases
Outside groups cannot make purchases on behalf of district students or schools and expect reimbursement for the purchases. If a purchase is made by the outside organization, it is considered a donation to the district.
Raffles as Fundraisers
Per Arizona Attorney General Opionion I84-018 school district clubs are prohibited from holding raffles. Even if the activity is called something other than a "raffle" the activity is prohibited if it involves the selling of a ticket for the chance to win a prize through a drawing. School district staff, students and resources (email, photocopiers, etc.) cannot be used to advertise or conduct an outside organizations's raffle. In addition, the district cannot have raffle drawings on school property.
Generally, entities that are not school controlled (such as off-campus clubs, clubs sponsored by civic groups or parent-teacher organizations) and entities that also fit within the tax exempt categories by A.R.S. 43-1201 may hold raffles if they also meet the requirements of A.R.S> 13-3302.B.
In order to be eligible, the outside organizations need to also meet the following tests:
- The organization must be a separate legal entity from the Peoria Unified School District and the organization must have its own taxpayer identification number. In addition, the organization must meet the requirements of being an organization that is exempt from federal income tax under Section 501 of the Internal Revenue Code.
- The nonprofit organization needs to have been in existence continuously in Arizona for a five year period immediately prior to conducting the raffle.
- No person except a bona fide local member of the sponsoring organization may participate directly in the management, sales or operation of the raffle.
Due to the state imposed restrictions on public schools holding raffles, outside organizations should not advertise raffles on school property or use school resources or students to sell raffle tickets.
Vendor Registration Requirements
On occasion a school parent support organization may hold a community event that involves other schools in the district. A multi-school or multi-district band competition is an example of this type of activity.
If the parent organization is charging fees for outside school groups to participate in the event, it is necessary for the parent organization to register as a vendor with the Peoria Unified School District to receive fee payments. This will include the parent organization completing a Vendor Registration Form and Form W-9.
PTA, PTSO and Booster Club Fundraiser Requirements
If a parent organization plans a fundraiser that will involve student effort, the parent organization and the school principal (or the student club sponsor) should agree in advance to an allocation of proceeds. The allocation must be based on the level of effort devoted by each group. This allocation is required per the Uniform System of Financial Records of Arizona School Districts (USFR), Appendix H.
Parent organization fundraisers that will involve students should be reviewed and approved by Peoria Unified administration.
All outside parent organizations must provide a listing of their "Fundraising" activities to the school they support each year. This will include PTSO and Booster Club fundraisers with local corporate sponsors including grocery stores and other retailers that make donations based on patron purchases.
Annual Audit Requests
The Peoria Unified School District has an annual financial audit that is performed by an outside CPA firm. Under GASB 39, the district's auditors require Peoria Unified to contact all of our PTSOs, PTSAs, Foundations and Booster Clubs to ask for certain financial information to determine if the organization's support is at a level where the financial activity would need to be included in the district's Comprehensive Annual Financial Report.
Annual Officer Information and Fundraiser Request
Parent organization contacts and officers may change from year to year. The annual information sheet gives the district current contact information foro ur GASB 39 audit inquiries as well as updated fundraising information.