Pros and Cons of Homeschool Co-ops
October 13, 2009
Homeschool blogger, Spunky Homeschool, asks about the disadvantages of belonging to a homeschool co-ops and her concerns.
The Pros and Cons of Co-ops
Are you in a homeschool co-op? I joined one last year so my son, a high school junior, could take a Physics class; we enjoyed the experience and signed up again this year. There are quite a few co-ops in our area and they appear to be a growing trend among homeschoolers around the nation.
But I do sometimes wonder what the co-op trend means for the future of homeschooling. Will the government jump in and require those that teach other families to be credentialed; or God forbid, will the teachers union step in and demand that mothers be unionized. A few years ago, I would have laughed at that thought. But that is exactly was is a occurring with in-home health care workers in Illinois and mothers who do in-home daycare in Michigan. Right now this seems to be happening only with those workers who receive state aid, something our co-op does not do. But some co-ops may have members who do receive some sort of state assistance for their children and that’s where things could start to get muddy.
Like Spunky, I know the blessings of belonging to a homeschool co-op and the disadvantages. When I wrote my book, Homeschool Co-ops: How to Start Them, Run Them and Not Burn Out, a friend noticed that my chapter on the disadvantages was longer than the advantages of a homeschool co-op! Ha, ha!
I just believe that homeschool co-ops are like marriages, it’s best if you go in with your eyes wide open!
I work hard to help homeschool leaders run the best co-ops that they can and be a blessing to their members, but not burn out anyone-leader or member!
Read through some comments or post your own here at Spunky’s site.
Carol Topp, CPA
Homeschool Leader, Do You Need Help?
October 11, 2009
I am so pleased to announce several ebooks and audios for homeschool leaders are now available
Price: $10.00 (immediate download as a pdf file)
Price: $10.00 (immediate download as a pdf file)
Price $8.00 (immediate download as a pdf file)
Paying Workers in a Homeschool Group ebook
October 10, 2009
I’m happy to announce a new ebook to help homeschool leaders
Paying Workers in a Homeschool Organization
- Are you paying workers in your homeschool organization?
- Can a volunteer be paid?
- Should a worker be treated as an employee or independent contractor?
- Do you know the difference?
This 20 page ebook covers paying workers as employees or independent contractors. It includes sample forms, tips and advice to help you pay workers in accordance with the IRS laws to help your organization pay their workers correctly. Written specifically for homeschool organizations.
Price: $7.00 Available for immediate download as a pdf file
After you fill in the order page, you will receive an e-mail with instructions and a link to download your ebook.
I really hope you find this ebook helpful.
Carol Topp, CPA
Banker wants IRS letter to open a checking account
September 28, 2009
Hi Carol,
At your leader meeting a few months back, you had recommended that all of our groups have the same EIN number. When a group leader tried to change their account to one using our EIN, the banker wanted a copy of our original letter from the IRS. I told the banker that we have never had to provide anything except a letter from me (one who obtained the number in 2002) and the EIN number which we provided. He said it was just a personal preference of his. Have you heard of this? I am uncomfortable doing more than what is usually required and providing personal paperwork to him. Am I being unreasonable, or do you think it is okay to provide it? Thanks for any insight.
Debi in Indiana
Debi,
I’m with you-the banker should not need an IRS determination letter (I assume that’s what’s he is talking about) to open a nonprofit checking account. Many nonprofits never get a tax exempt determination letter from the IRS because they remain very small.
Don’t believe the banker if he says an IRS 501c3 determination letter is required to open a checking account (fortunately he said it was his personal preference). I once had a bank teller tell me that nonprofits couldn’t earn interest on their savings accounts because they were nonprofit! She was greatly mistaken. Bankers don’t always know what they are talking about (outside of banking…)
Carol Topp, CPA
Debi followed up my reply with the following
I think there is some confusion on what the bank manager is asking for.
I don’t think he is asking for us to prove that we are a 501c3 non-profit as recognized by the IRS. I think that all he wants is a copy of the letter from the Department of the Treasury that assigned us the EIN number. He probably doesn’t even know the right terms for what he is asking.
Yes, I think you are correct. The banker may have only been asking for the EIN paper from the IRS, not a 501c3 determination letter.
I guess he’s being careful about getting the EIN correctly from the IRS letter itself. I can’t blame him for that.
Carol Topp, CPA
More lessons from a homeschool co-op
September 19, 2009
Faye had so many good lessons she learned from her homeschool co-op, I’m splitting them into two parts. here’s more great lessons learned from someone in the trenches of a homeschool co-op.
6. Sometimes kids won’t like the class you are teaching; some may even decide to drop out after a few weeks. Try not to take it personally.
7. A co-op with mixed ages provides amazing opportunities for older kids to learn how to be around, and help, younger kids. My little guy made so many connections with the older boys; it was wonderful. And, having the older kids play with my son was a huge help to me. Bonus–I may have found a future babysitter!
8. There is nothing like a good game of Twister to shake things up a bit. Read my Twister article to learn about our fun!
9. It may take some effort to stick with a co-op. After all, you probably had a routine before you joined the co-op, but don’t give up. A co-op can really liven up your weekly schedule, not to mention all the new avenues can open for your kids.
10. The more you can help, the better the co-op will be. If you have a few extra minutes, see if something needs to be set up, or cleaned up, or put away. If you have an idea for a class/program/field trip, share it with the planning group. One of our co-op families held a “tie dye” day and invited everyone to their house for a day of messy, creative fun. I will never forget the site of all those tie-dyed shirts, blowing in the breeze on the clothesline.
11. If one idea doesn’t work, don’t be afraid to toss it or tweak it. We had started a MathCounts program, but for some kids that just didn’t work. So, another mom gathered some awesome math games and brought them to the co-op for the kids who were a little intimidated by MathCounts. The result? The math games were a HUGE hit; kids were helping to get their parents out the door on time, so they wouldn’t be late for math games!
12. Let your kids have fun, and don’t force them to try everything. Sometimes just being exposed to new things will pique their interest in something different, which may encourage them to give it a try. A co-op should be educational, but it should also be enjoyable.
I completely agree with everything Faye learned, especially #10 on everyone helps and #11 on staying flexible. They are so important in a homeschool co-op and so easy to forget! Thanks for sharing your experiences Faye!
If any of you want to learn how to start a co-op or run the co-op you belong to in a better way, order my book, Homeschool Co-ops: How to Start Them, Run Them and Not Burn Out.
Carol Topp, CPA
IRS fees will increase January 3, 2010
September 2, 2009
This just released by the IRS. Fees for applying for 501c3 tax exempt status are set to increase January 3, 2010:
User fees will increase for all applications for exemption (Forms 1023, 1024, and 1028) postmarked January 3, 2010:
A complete schedule of all user fees will be published in the annual procedure released in January 2010.
Cyber Assistant, a Web-based software program designed to help 501(c)(3) applicants prepare a complete and accurate Form 1023 appplication, will become available during 2010. Once the IRS announces the availability of Cyber Assistant, the user fees will change again:
IRS will announce when Cyber Assistant is available and the effective date of the user fee change. Subscribe to the EO Update to automatically received an alert that Cyber Assistant is available.
http://www.irs.gov/charities/article/0,,id=212562,00.html
So get your 501c3 application (Form 1023) in before January 3rd to save $100. (The current fees are $300 or $750 depending on your gross revenues)
Cyber Assistant sounds like a good tool, but the IRS does not say when Cyber Assistant will be available in 2010, so we have no idea when the lower rate of $200 will be available.
Last time the IRS increased their fees they received a deluge of applications and had a huge backlog for months. Small, new nonprofits try to save a buck wherever they can and will try to take advantage of the lower rate. While I am glad to see the fee will eventually be dropped to $200, I still expect to see an increase in applications before the due date.
Carol Topp, CPA
Lessons learned from a homeschool co-op
August 29, 2009
Faye, a homeschool mom and columnist for the DC Examiner.com, has a list of lessons she learned while being in two homeschool co-ops this year.
When we joined two homeschool co-ops last year, it completely changed our homeschooling life. For one thing, I had to be sure not to plan anything else on co-op days, because we were already busy. Sometimes this made scheduling field trips a little tricky, but the juggling was well worth the effort. Another big change was that on co-op days, we all had to get up at a scheduled (earlier!) time, so that we could be out the door on time. We aren’t big morning people around here, but I think the change did us good. And finally, it brought more friendship and support into our family and into our lives, which was perhaps the biggest blessing of all! There were many other things that I learned, and I thought it would be fun to share a few of them:
1. Kids who are not used to daily “school” may not always have pencils, pens, or paper. Be sure to bring extra!
2. No matter how hard you wish, if your co-op is exactly 18 minutes from your house, you will not be able to get there in 10 minutes. Leave early (or at least on time).
3. Even if you are the “teacher”, sometimes you will be late (refer to #2 for the solution to this problem)
4. A big roll of paper and a box of crayons are indispensable for keeping little ones occupied. The paper may come in handy for other uses (see #1).
5. You probably already know this, but kids NEED time to run around outdoors. If your co-op doesn’t have access to an outdoor space, try to find a way for the kids to take a walk or play some indoor games. Getting the wiggles out is very important.
More of Fay’s lessons learned coming soon.
Meanwhile, if you would like to learn more about starting or running a
homeschool co-op, order my book, Homeschool Co-ops: How to Start Them, Run Them and Not Burn Out.
Carol Topp, CPA
Is insurance needed for small homeschool groups?
August 25, 2009
Do small homeschool groups need insurance?
Often they do, especially of their host/landlord requires general liability insurance.
To help you discern your risk and need for insurance, Harvey Mechanic, an attorney that specializes in nonprofit law, lists some potential claim areas:
POTENTIAL CLAIM AREAS:
1. Discrimination (Age, Race, Sex)
2. Wrongful dismissal of employee
3. Mismanagement
4. Financial failure/bankruptcy
5. Poor administration resulting in losses
6. Causing the organization to incur unnecessary tax liability
7. Imprudent investments
8. Misuse of contributions
9. Conflict of interest
10. Unauthorized loans
11. Failure to obtain competitive bids
12. Unwarranted expansion
13. Failure to obtain government funding or lower interest loans
14. Misuse of government funds or grants
How many of these situations could occur in your homeschool organization? Probably some, but not all. Large nonprofits like the Red Cross or a hospital face many of these potential risks and need insurance.
In my article, “Insurance for Homeschool Groups,” discuss the various types in insurance a homeschool group might need and how to lessen your risks to obtain a reasonably priced insurance policy.
Insurance for homeschool groups
Carol Topp, CPA
Should a co-op be a separate organization?
August 17, 2009
Carol,
We have one entity (group) that works outside of our association, this is our 
Co-op group. This group does take in money – I believe it’s run out of a separate bank account. I know our Co-op group has a board, and bylaws but not an EIN number, which I know is very easy to get. What are they benefits of us staying as one group? My question is: should our Co-op group run their funds separately like this?
Sandy in TX
Sandy,
Your co-op could be organized as under your association or as a separate group. It’s really up to you. Since they have their own separate board and bylaws, perhaps they are really operating as a separate unincorporated association already. You could be officially separate if they obtain their own Employer Identification Number (EIN) from the IRS.
There might be advantages to staying as one group. There are fewer volunteers for the board positions, consolidated financial reports, and shared workload. The co-op could remain a part of your organization, but with a separate checking account and its own budget. It could be self-sustaining financially, but still part of your association. Many church-run schools operate like this, financially self-sufficient, but still under the umbrella of the church.
Carol Topp, CPA
Finding a CPA for your nonprofit
August 13, 2009
I wrote this article for Step by Step Fund Raising titled
by Carol Topp, CPA
Your nonprofit needs professional accounting help, but a good CPA can be hard to find. You desire someone who is knowledgeable but understandable, experienced but still affordable, and professional yet interested in your mission.
How to find a CPA to help your nonprofit:
- Tell your staff, members and volunteers of your need and request that they ask friends and neighbors for referrals.
- Mention your search for a CPA in your newsletter.
- Look over your member or donor list for CPAs and call to see if they are qualified and interested.
- Join an on line professional network like LinedIn.com, join some groups and post your need.
- Call your state CPA society for referrals. WebCPA.com lists state CPA societies at.
- Ask other local nonprofits for their CPA’s contact information.
- Use an on line matching service such as Accountants for the Public Interest that matches volunteer CPAs to nonprofits at.
Finding a qualified CPA is the just the beginning. You also desire a good working relationship that benefits your nonprofit more than it costs.
When you work with an accountant:
- Be specific about the task
- Ask for an estimate of their fee
- Request an engagement letter that will spell out the specific tasks and estimated cost
- Inquire if the charges can be reduced. Some CPAs will offer a discount if you can delay work until after tax season.
- Discuss how much of the work your staff or volunteers can do to help reduce fees.
- Ask for lower cost alternatives. For example, a review of your financial statements may suffice instead of a full audit which is much more costly and time consuming.
- Be prepared to ask questions, read and learn on your own
Seek out an accountant that has the ability advise you about the financial side of your nonprofit. You should feel comfortable with him or her and be free to ask questions. A good accountant is not just a bean counter; they are also a business advisor. They should explain issues and financial statements in a language that is accurate, yet understandable. If you leave a meeting with your accountant feeling confused, you should find another accountant.
Ask a potential CPA these questions:
- How many nonprofits do you have as clients? Hopefully, the accountant has clients similar in size to your organization. Size is usually measured in staff size, number of clients served or annual revenue.
- What is your area of specialty? Some CPAs conduct audits while others specialize in preparing the annual IRS Form 990. Select an accountant that matches your needs.
- With whom will we be working? In medium and large accounting firms there are several layers of management. The person doing the original interview may not the one doing the work. Alternatively, in a small or solo firm you will probably work with only one individual.
- May I see your biography or Curriculum Vitae (CV)? Look for participation on church or community boards, published articles and professional memberships.
- Can you explain to me the reporting requirements for my nonprofit? This type of question is really a test to see how well the CPA explains IRS guidelines. Is their explanation understandable to you or do they lapse into accounting jargon?
- Do you charge by the project or by the hour?
- Am I free after this engagement to call you with questions? Will I be billed for the phone call?
After their first audit, a small, but growing, nonprofit asked their CPA, “ How do we compare to other nonprofits? What can we be doing better?” The CPA was unable to answer their questions. He was good at number crunching, but he could not see the bigger picture and seemed unable to offer advice. The director was quite disappointed. They used the techniques mentioned here and found a qualified, helpful CPA with a reputable firm that guided them through many successful years of expansion.
Carol Topp, CPA //