Schools, school districts and their business officers, superintendents, principals and other administrators should audit their booster clubs to make sure that they are operated legally, according to Parent Booster USA (PBUSA). According to PBUSA, school booster clubs often mistakenly and illegally use the school’s federal tax ID number and state sales tax-exemption certificate. In addition, booster clubs often fail to file required federal tax returns. A new law requires all nonprofits, regardless of the amount of funds raised, to file an IRS return.
PBUSA, a national educational organization, is offering a free program to help schools review their booster club operations and bring them into compliance. “PBUSA’s mission is to help schools, school districts and booster clubs navigate the complexities of operating a legal nonprofit school support organization,” stated PBUSA Founder Sandra Pfau Englund. “Through our new BoosterCheck program, PBUSA will provide a free report to school administrators that tells them whether their school booster clubs are incorporated, have federal tax-exempt 501(c)(3) status, and have filed the required IRS tax return.” If school booster clubs are not in compliance, the report will provide information on how to bring the school support groups into compliance. School administrators may sign up for the free program online at PBUSA’s website.
The failure to operate legally and comply with federal regulations is, for the most part, unintentional according to Englund. “Most parent volunteers and school administrators are simply not aware of the rules,” noted Englund. “They just want to raise enough funds to support the band, choir, sports teams, and other school clubs and organizations.”
Parent Booster USA is a nonprofit, 501(c)(3) educational organization that provides support and information to school booster clubs. PBUSA is authorized under an IRS group letter ruling to provide immediate tax-exempt status to school booster clubs, eliminating the need for these organizations to file separately for tax-exempt status.