PTA and Taxes: Filing an Extension

Question:

I know that the deadline for filing our unit's federal tax return is November 15th, but I'm not sure we will have all the information we need. Is it possible to obtain an extension of time, and if so, how do I go about it?

Answer: 

You are correct that the deadline for nonprofits (which obviously includes all PTAs!) to file their annual federal tax return for the 2010-11 fiscal year is November 15th.  This is a postmark date, which means that the return (if filed by mail) must be postmarked no later than that date.  The good news is that the filing requirements have changed so that many PTAs that previously were required to file a paper return no longer have to do so.  If your PTA “normally” receives less than $50,000 in revenue, the PTA must file the 990-N electronic return. 

However PTAs with revenue “normally” between $50,001 and $200,000 must file either the 990EZ return or a full 990, and those whose “normal” revenues exceed $200,000 must file the 990.   To determine your PTA’s “normal” revenue, average the revenue for 2010-11 with the revenue for the two previous years, and remember than you can deduct the portion of your membership dues that you forward on to council, the State PTA and National PTA when making these calculations. 

Regardless of which form must be filed, the due date is November 15th--however if you do not believe that you can meet that deadline, you can file for an automatic three-month extension using IRS Form 8868.  New this year, you can both complete and file the application online for free.  Both the form and instructions are available here.  However the extension must be granted before the due date, so if you think you may need an extension, file it now!

Details For Taking Minutes

Question: 

We have several questions about the minutes. First, how detailed should they be--should every comment be recorded and attributed to the speaker by name? Should the votes on a motion include names of who voted and how they voted? Finally, is it necessary to have the minutes of a previous meeting read aloud and have a formal motion to approve them?

Answer: 

The following is a summary from Roberts’ Rules of Order, which under Article 15 of the Uniform Bylaws is the parliamentary authority for issues not specifically addressed in the Bylaws or state law.  The minutes of a meeting—whether it’s a meeting of a committee, the Board or the general membership—become the official record of actions taken at the meeting once they have been approved.  Thus it’s important that any decisions be recorded accurately.  However recording each and every comment made during discussion is neither required nor is it a good practice, for several reasons.  First, it puts an unnecessary burden on the Secretary.  Second, people often say things in a discussion to draw out different points of view and including statements that may not accurately represent their own personal views.  Third, as we’ve all learned through email it’s difficult to capture the tone and flavor of an individual's comments in black and white, and there’s a significant risk that subsequent review of the minutes will generate a debate about what the person meant to say rather than the words s/he actually used, using time that could be put to a more productive endeavor. 

Similarly, the results of a vote on a motion should also be recorded, but not how individual participants voted.  There are two exceptions.  If someone abstained, particularly if the abstention is because of a real or perceived conflict of interest, that person’s name and the fact that s/he abstained should be recorded.  The other exception is when someone feels strongly that his/her dissenting viewpoint should be reflected in the record, that individual should be offered the opportunity to submit a dissenting statement to be added to the minutes prior to the time they are submitted for approval.  

As for approval of minutes of a prior meeting, if a draft of the minutes has been circulated in advance, or if written copies are available for everyone present, it is not necessary to read them aloud, although the president or chair may direct that this happen, and should do so if one or more persons present request that it be done.  A formal motion to approve the minutes is not necessary.  Rather after those present have had a chance to review the draft, the chair or president can ask if there are any corrections or additions to the minutes as presented.  Any noncontroversial changes—spelling errors, for example—can be made by consensus, and the chair or president can then announce that the minutes stand approved as presented or as amended, whichever is appropriate.  However, if there is disagreement as to the accuracy of one or more points in the minutes, a motion should be made spelling out how the draft minutes should be changed, and following discussion there should be a vote on whether to make the specific change(s) proposed in the motion.  Following all such motions there should be a motion to approve the minutes with any change(s) approved during the process. 

Sales Tax on Items for Re-Sell (ie., Spirit Wear)

Question: 

We’re having our annual spirit wear sale, and the vendor insisted that we had to pay sales tax when we purchased the items to resell.  I later heard that we could have avoided paying sales tax because we’re a non-profit.  Is that true, and if so is there any way to get back the sales tax that we weren’t legally obligated to pay in the first place?

 

Answer: 

First, it’s not true that non-profits do not pay sales tax when they purchase taxable items for their own use.  Thus if you’re buying a notebook to keep a copy of your PTA’s legal documents, or tablecloths for a PTA dinner, you pay sales tax like anybody else.  However, when you buy items to resell, such as the spirit wear you mentioned in your question, you can avoid paying the sales tax by obtaining a Reseller’s Permit from the Washington Department of Revenue.  The permit is easy to obtain—just click here and follow the directions.  And there’s more good news—you can also obtain a refund of the tax you paid from the Department of Revenue.  You can learn more about state tax laws and how they apply to PTAs by attending one of the many upcoming PTA & the Law workshops being held this month, and by checking out the Frequently Asked Questions available on the Leadership Resources section of the WSPTA website.