Kind of OT, but not completely - Fundraising

[k2bdeutmeyer]

Not gymnastics related fundraising though

DD has been playing competitive softball this year. It sounds like next year we are going to play USSSA ball instead of ASA to give us the opportunity to stay together as a team (because they have an 11U team vs my DD and 2 others having to move up to 12U in ASA), and possibly go to the world series. It will be exciting and fun for the girls, but probably quite a bit more commitment for the parents.

That being said, I know there is no way my family can afford it without some fundraising. So, with the old saying "if you want something done right, do it yourself" in mind, I volunteered to set something up and run it.

Now, I need help! There must be some experienced Moms or Dads out there! I get the general idea, and can easily come up with ideas for the fundraisers themselves. I am, however, a bit confused on the logistics of it all. I assume I'll need to go open an account to be used for the funds, and I'm thinking I'll keep a running spreadsheet to keep track of how much each girl has in her "account". I will split the proceeds of each fundraiser evenly among the girls that participate (assuming it is a group event such as a car wash), unless it is an individual sales event in which case each child receives the proceeds from their individual sales.

Here's where my questions come in:

1. When it comes time to use the funds, how do you distribute them? Take requests, pull money out and hand out cash? I want the funds to be able to be used for more than fees - hotels, gas to get to tournaments, etc.

2. Are there legalities I need to be concerned about?

3. Does my plan for separating funds sound typical? Fair?

4. Any other advice or things I should be aware of?

Thank you so much for any insight!!! I need to get going on this ASAP!

 

[jcs]

We did a lot of fundraising in high school for band trips, our band director was a master at fundraising. I think you have the right idea on the spreadsheet for each girl, he had a book since computers were just starting to be used lol. I also think it makes sense to split the proceeds for group events of those who participate. You need to show up to get your $$....we also did individual fundraising (band a thons, roast beef dinners, ticket sales to concerts, etc.) where we could raise our own money that went into our account for our trips. He always made sure we got more than 50% of the funds....Roast beef dinner tickets would be $12 and cost him $4 so we got $8....he was an amazing negotiator and would get so much donated so the money came to us . When it came time to pay for the trip, we could either use that money as credit but if we had more than what the trip cost, we got a check for the difference for spending money, etc. So if there are expenses you have as a group, you could have the money go towards that first and then give them their extra if they have it available.

Good luck!

 

[eryes]

My first concern would be related to taxes. How are you planning on setting up the bank account? Who's EIN/SSN would you be using? That sort of thing. Once you structure how the organization is functioning financially, you will get to think about the fund raising activities and goals.

I would also make sure that the financial records are distributed to all parents. I wouldn't want anyone accusing me of stealing funds or what-not... and that is, unfortunately, somewhat commonplace within these types of situations.

I think the way jcs' band fund raising operated would work in your situation. I would not hand out cash, either - cut a check for each girl's gross income to insure that you have a receipt for the funds spent.

I hope I'm not sounding like a "debbie-downer," but these are my concerns as a bookkeeper for 3 non-profits.

 

[k2bdeutmeyer]

My first concern would be related to taxes. How are you planning on setting up the bank account? Who's EIN/SSN would you be using? That sort of thing. Once you structure how the organization is functioning financially, you will get to think about the fund raising activities and goals.

I would also make sure that the financial records are distributed to all parents. I wouldn't want anyone accusing me of stealing funds or what-not... and that is, unfortunately, somewhat commonplace within these types of situations.

I think the way jcs' band fund raising operated would work in your situation. I would not hand out cash, either - cut a check for each girl's gross income to insure that you have a receipt for the funds spent.

I hope I'm not sounding like a "debbie-downer," but these are my concerns as a bookkeeper for 3 non-profits.

Not sure how I was going to set up the account! LOL! I guess that's the part I'm not sure how to do. Distributing the records to the group was something I planned on doing regardless. I definitely don't want to be accused of doing anything "funny".

As far as using it for group costs first, I'm not sure that will work in our situation. Our fees are almost all individual (team fee, uniforms, equipment - not necessarily required, hotels, gas for our cars, food/gatorade, etc) and those are the things I'd like to have help with. My family cannot afford all the costs associated with travel (hotel, food, gas) that often and I've had several other parents say the same.

Using checks sounds better to me. I would feel weird handing out cash!

 

[Gymdad2]

Taxes are also a concern for you. I would suggest that you consult (hire) a CPA to do your IRS reporting. If you are going to organize as a non-profit entity (this has to be filed with the IRS) then your treasurer (you?) has to file a yearly statement with the IRS detailing all income / expenses / distribution. According to IRS rules, if you are a non-profit then you are required to share all funds equally among all members, regardless of who does what work, or who sells what items. If you are not a non-profit, then you don't have to meet these requirements, but you are required to file a yearly tax statement with the IRS regarding income and expenses and pay taxes on that income. Again, I would reccommend a CPA as this is most complicated and you do want to stay on the right side of the law as your name is going to be on those tax returns and you can guess who the IRS is going to want to talk to. Good luck.

 

[eme777]

Just FYI, because it's happened to some organizations we have been involved with...Technically, if you're a non-profit, you can't put it in the athletes' accounts or hand out the money. It has to be used as a lump sum to pay for a group.

For example, at a gym, even if only 1/3 of the families participate in a fundraiser, the money would have to go directly to the gym or other business to cover the fees of the entire group. A lot of people don't realize this & most groups don't handle it this way. It's up to each group if they want to take the risk & split the money into individual "accounts". If you want to be strictly legal, from my experience, the law is complicated enough that you'll definitely want to have a professional set it up with you.

Whichever route you take, good luck!

 

[Deleted member D3987]

this is one of those topics again. i just want to chime in that i have experience with booster clubs, 501c3, etc; i never comment on these kinds of topics because the fed laws are not crystal clear and most of the state laws are not either. when this subject comes up, you need to find a tax attorney or accountant that is familar with the different levels of this subject matter and what the laws are specific to your state.

in other words, there are NO one size fits all on this subject matter. and if you're in a public/private school, the rules change just a bit yet again.

this is the wrong place to discuss this subject matter or tender advice. IMO.

 

[Gymdad2]

Dunno,

I fully agree with you and that's why my advice is to hire a CPA. I have been involved with the booster club for many years and the rules are very complicated, especially regarding non-profits and funds distribution. I am sure that state laws do vary greatly but the IRS is the IRS and that applies across the board. The CPA or tax attorney is the right answer.

 

[k2bdeutmeyer]

Thanks for the advice - I'll look into getting that information. I don't necessarily need or want to be a unique entity, but if we have to be that formal to be legal, then I guess so be it.

 

[Deleted member D3987]

Dunno,

I fully agree with you and that's why my advice is to hire a CPA. I have been involved with the booster club for many years and the rules are very complicated, especially regarding non-profits and funds distribution. I am sure that state laws do vary greatly but the IRS is the IRS and that applies across the board. The CPA or tax attorney is the right answer.

i pointed out the "state" issue because some programs/clubs/schools only go for the state exemption, and not federal, because they are easier to get sooner than the fed exemption.