A Unit in Good Standing:*
(i) Adheres to the purposes and basic policies of PTA
(ii) Remits dues to Alabama PTA by dates designated in these bylaws
(iii) Has a current officer list on file in the Alabama PTA office, and
(iv) Has By-Laws which have been updated within the last three (3) years on file in the Alabama PTA Office
(v) Has maintained its 501c(3) tax exempt status or is actively working with the IRS to have its tax exempt status reinstated.
CLICK HERE: FOR MORE INFORMATION ON REINSTATMENT PROCEDURES
(vi) Has maintained membership levels as follows: A minimum of 15 members for schools with enrollment of 200 or less students, 25 members for schools with enrollment of 201 to 500 students, and 50 members for schools with enrollment of greater than 500 students, and
(vii) If located with an organized council, follows adopted guidelines of that council in paying dues and/or participating in other programs.
* New criteria for remaining a unit in good standing was voted on at the May 2014 Convention in Huntsville.
PTA units must be in good standing to participate in grants, awards, and other PTA programs such as Reflections.
Your Local PTA Unit's Responsibility in Maintaining Your Non Profit Status with the IRS and More
Benefits of belonging to PTA - Alabama PTA State Office secures a Taxpayer Employee Identification Number
Your Local Unit PTA is not responsible for paying state or federal income taxes and that donations to your local unit PTA are considered as charitable donations.
With this benefit comes some responsibility on the part of the local PTA unit.
While income is not taxable, the IRS may impose fines for not filing a return. Please make certain your tax returns are filed annually.
Being income tax exempt is not the same as being sales tax exempt. Alabama PTA and its local units are not sales tax exempt. There is an important reason why Alabama PTA has never sought sales tax exemption. As you are aware, public education in the State of Alabama is funded through sales tax revenues, so by seeking sales tax exemption, we would be taking funds from public education which is not part of our mission. Just for reference, you should not be charged sales tax for fundraising items through a fundraising company.
Falling under the Alabama PTA group exception is an important benefit of membership and sets us aside from other parent organizations where you would either have to secure your own tax exception or keep all your funds in a school account which ultimately belongs to the school and is under their discretion. PTA funds and school funds should always be kept separate. Per the Alabama Department of Education, school employees may not handle PTA funds. They cannot be signers on your checking account, and they should not be collecting funds on behalf of PTA. However, they may serve on your PTA Board as long as they are not on the banking accounts and do not handle funds.
Generally speaking, when a local PTA unit's tax exempt status is revoked due to non-filing of returns, it is because during transition from one group of officers to the next this vital information is not forwarded on to the next president and treasurer and they are unaware of this responsibility. While these requirements are always emphasized at State and Council trainings and meetings, not all units attend training, and not all units are in Councils.
Please take the time to print out this explanation and make certain it is in the president and treasurer notebooks for your local unit PTA.
If you have received a letter from the IRS stating your 501c3 status has been revoked CLICK HERE for information on how to apply for reinstatement.