Question:
We received
our Official Back to School Kit from National PTA and I noticed a significant
difference between the National version of Money Matters and the one that is
included in the Washington State PTA Leadership Kit. The issue has to do with accounting for that
portion of membership service fees that are collected from members and then
sent on as council, state or national portion of the fees. The National PTA book says that those fees
should never be included in the PTA’s income, but the Washington State Money
Matters says just the opposite, i.e. that the council, state and national fees
should be included as income in the PTA’s accounting system. I don’t understand why Washington state would
be different from what National PTA is telling us.
Answer:
The reason Washington State is different is that
local units are required by state law to include membership service fees in
their income for purposes of the state Charitable Solicitations Act, RCW
19.09. The folks at National PTA are
not, of course, aware of the various laws applicable in the 50 states, and
their advice appears to be based on federal tax laws. It’s true that the portion of fees sent on to
council, state or national are not included in computing income when your PTA
completes its 990N, 990EZ or 990 form next month. However Washington PTAs must include all fees
received from members in determining whether they have to file under the state
Charitable Solicitation Act, and that’s why Washington State PTA advises that
all fees – including the portion that is sent on to council, state or National
PTA -- be recorded as income on the PTA’s books.
