Question: 
Our local unit adopted the 2011-12 budget last spring, but over the summer some things have changed that weren’t anticipated when the budget adopted.  Are we stuck with the budget or can we ask our membership to approve some amendments?  
 

Answer: 

Yes.  The budget is developed as a projection based on the best available information at the time.  However since the members adopted the budget they can also amend it, and when I say “members” I mean the membership as a whole, not necessarily those individual members who were present when the budget was adopted.  One further note, you may want to consider also amending the local unit’s standing rules to allow the Board some flexibility to reallocate funds during the year, just in case some need arises when it’s not possible to call a meeting of the entire membership.

Question:

We have completed our financial review and decided that we might as well file our federal informational tax return at the same time.  I understand that the income levels that determined which form we file (990N, 990EZ, or 990) have changed but I’m still unclear on a couple of points.  Our revenue in previous years has generally been below $50,000, but last year one of our fundraisers was more successful than expected (Yeah!) and our revenue was slightly more than $51,000.  Does that mean we still have to file a 990EZ? 

 

Answer: 

What a great idea to file your tax return when you have all the information in front of you from the financial review—getting it completed and filed now means you won’t have to worry about meeting the November 15th deadline!  You are also correct about the revenue levels changing. 

Here are the revised levels for the 2010-11 fiscal year:

• Revenue less than $50,000, file the 990N
• Revenue $50,000 to $200,000, file the 990EZ
• Revenue more than $200,000, file the 990.

Now to answer your questions, keep a couple of things in mind.  First, remember that when you compute your PTA’s revenue for the purpose of the IRS filing, you can deduct that portion of your dues that is forwarded to your council, the state and National PTA.  Second, the form that should be used is based on the PTA’s ‘normal’ level of revenue, not necessarily the actual income for the particular year.  To determine the ‘normal’ level you average the year in question plus the previous two years.  Thus to determine the appropriate form for 2010-11, you would average the revenue for 2008-9, 2009-10 and 2010-11.  If the average for all three is less than $50,000 your PTA can file the 990N electronic postcard; if the average is higher, your PTA should file the 990 EZ for the 2010-11 fiscal year, even though your revenue for that year may have been slightly more than $50,000.  Finally remember even if your PTA is eligible to file the 990N, you have the option of filing a 990EZ, but heed the IRS’ caution here.  

Who can be on a financial review committee?

Question: 
We are getting ready to conduct our annual Financial Review, and both the outgoing and incoming treasurer have expressed a willingness to serve on the Financial Review Committee.   According to the Money Matters section of the Leadership Packet (page 16), the outgoing treasurer is “not a member of the financial review committee [but] a resource to the committee [who] is normally not present when the financial review committee meets, but should be available by phone to answer questions.”  However, having the outgoing treasurer present would seem to expedite the process because she is very familiar with the financial records, and the incoming treasurer should start getting familiar with the records.   Why can’t they both be members of the committee? 

Answer:  
Under the Uniform Bylaws, no one who had signing authority on the PTA’s account(s) can be a member of the Financial Review Committee.  Assuming the incoming Treasurer was not a signer on the account during the past year, appointing that person to the Committee is a very good idea for the reason you mentioned.  The purpose of the financial review is to provide an independent review of the PTA’s financial records, which can only take place in a setting where the committee members will not feel reluctant to ask what may be difficult questions.  That’s why WSPTA recommends that the outgoing Treasurer not be present, but be available to answer questions. 

Can a PTA leader endorse a local candidate?

Question: 

I am well-known in my community as a leader in the PTA, and I’ve been asked to endorse a candidate who is running for the school board.  I would like to support this candidate, but I know that PTA is not supposed to get involved in partisan campaigns, but I’m not sure if that extends to nonpartisan offices such as school board.  What are the rules? 

 

Answer: 

You are correct that PTAs do not endorse candidates for public office, and that prohibition applies regardless of whether the race is partisan or nonpartisan.  This prohibition is in the Uniform Bylaws (Article 2, Section 1(a)) and also a requirement to maintain tax exempt status under Section 501(c)(3) of the Internal Revenue Code.  While individuals who are PTA leaders are not prohibited from exercising their personal rights to be involved in the election process, they should take pains to make sure that such participation does not imply support from the PTA rather than from just the individual.  This would be particularly true in the situation you describe, i.e. the fact that you are well known to be a PTA leader may make it difficult for the average voter to distinguish you as an individual from you as a spokesperson for the PTA.  One step you can take is to not include your PTA affiliation in any printed material that includes your endorsement, or if reference to your PTA affiliation is necessary for identification purposes (“Which Mary Smith is it who has endorsed Candidate Jones?”).  If so the reference should include a statement that the PTA affiliation is for identification purposes, and does not imply endorsement by the PTA itself.  One final consideration, assuming you are in a leadership position with the PTA, is the impact of an endorsement of a candidate on your ability to be effective as a PTA leader if your candidate doesn’t win the election.  Unlike the endorsement question, this one doesn’t have a hard-and-fast rule, but you should definitely consider this aspect and perhaps talk to the others on your PTA’s board to get their perspective before making a final decision.