Ultimate Homeschool Expo:An online homeschool convention!

The Ultimate Homeschool Expo 2011  starts Monday May 2!

I have pre-recorded two sessions:
5 Ways a Homeschool Co-op Can Benefit Your Child
and
Career Exploration for Homeschool High School Students

and on Wednesday May 4 at 11 am EDT, I will be presenting:
What Your Child Can Learn From Starting a Business

The Ultimate Homeschool Expo is the largest on-line homeschool convention with over 100 sessions and 50 speakers.

Here’s a schedule for the week:
May 2 @ 11:00 AM EST Cindy Rushton:Lord, Give Me a Vision–YOUR VISION!
May 2 @ 2:00 PM EST Marnie Swedberg–Kitchen Shortcuts.
May 2 @ 4:00 PM EST Lorrie Flem:The Ten Suggestions for Moms.
May 3 @ 11:00 AM EST Rick Boyer:Take Back the Land.
May 3 @ 2:00 PM EST Debbie Strayer:Reviving Your Teaching and Your Students
May 3 @ 4:00 PM EST Coach Rick Andreassen-SAINTS Ministering to a Child’s Heart
May 4 @ 11:00 AM EST Carol Topp:What Your Child Can Learn From Starting a Business.
May 4@ 2:00 PM EST Kim Kautzer:College Prep: Is Writing on Track?
May 4 @ 4:00 PM EST Cathy Duffy:Learning Styles: Choosing Curriculum to Fit Each Child.
May 5 @ 11:00 AM EST Cyndi Kinney:Using the Psychology of Color in Education.
May 5 @ 2:00 PM EST Dr. “Doc” Thomas Sharp:Truth in Science: Biblical View of Dinosaurs.
May 5 @ 4:00 PM EST Regina Hicks:Incorporating a Thomas Jefferson and Classical Approach to Your Educational Adventure.
May 6 @ 11:00 AM EST Maggie Hogan:Highly Effective Habits of Happy Homeschool Moms.
May 6 @ 2:00 PM EST Denise Mira:7 Keys To Unlocking the Leader Within Your Child:
May 6 @ 4:00 PM EST Brian D. Ray, Ph.D. If Homeschooling Is So Good Why Don’t Educators Promote It?

Isn’t that a great line up?
But there are more audio sessions, a virtual vendor hall, with freebies like ebooks, audios, giveaways and door prizes.

Learn more here.

If you can’t join the Expo live, the workshops are recorded and you can listen on your computer or download to your mp3 player and listen at your leisure. I like to listen as I take my morning walk!

Tickets are $39.95, but on special for only $24.97 for a limited time.

Buy your ticket here

Carol Topp, CPA

Finding a Local Homeschool Co-op

My home, Cincinnati, Ohio, has an abundance of homeschool co-ops and other opportunities for group learning.

Here’s an incomplete list of homeschool co-ops in the greater Cincinnati area.  Locations and meeting times may have changed. Please visit the website or e-mail for up to date information. E-mail me at Carol@homeschoolcpa.com with additions or corrections.

Don’t live in near Cincinnati? Visit these sites for local homeschool group information

A to Z Home’s Cool
Go to your state page and put “co-op” in the browser search

Local Homeschool.com
Search by “Type” for “Co-op” or “Cooperative.” You can further
narrow the search by including your state and/or county.

It may take a bit of digging, emailing and persistance, but eventually you’ll find a group that may nmmet your needs!

Can’t find a co-op near you? Buy my book Homeschool Co-ops: How to Start Them, Run Them and Not Burn Out and start your own co-op!

Carol Topp

5 Ways a Homeschool Co-op Can Benefit Your Child

One of my workshops for the Ultimate Homeschool Expo 2011  is titled

5 Ways a Homeschool Co-op Can Benefit Your Child

Here’s the handout so you can follow along!

5 Ways Co-ops Benefit Handout

Want to learn more about the Ultimate Homeschool Expo, an on-line homeschool convention with 30 speakers and over 100 workshops?

Learn more here.

The UHSE will be live the week of May 2-6, 2011, but until then every Thursday there are live workshops you can join for free.

If you can’t join us live, the workshops are recorded and you can listen on your computer or download to your mp3 player and listen at your leisure. I like to listen as I take my morning walk!

Tickets are $39.95, but on special for only $24.97 for a limited time.

Buy your ticket here

Carol Topp, CPA

Compare 501(c)(3) Charity to 501(c)(7) Social Club

The IRS offers more than a dozen different classifications of tax exempt status.  The most popular by far with 80% of the total is the 501(c)(3) “Qualified charity status.”

Many homeschool organizations may qualify to be 501(c)(3) qualified charities with an educational purpose or 501(c)(7) Social Clubs.

Here’s a comparison of 501(c)(3) “qualified charity” status and 501(c)(7) Social Club.

In general, homeschool co-ops fall under 501(c)(3) “qualified charity” because they have an educational purpose, while homeschool support groups fall under 501(c)(7) Social Club.

	501(c)(3) Qualified Charity	501(c)(7) Social Club
Purpose	Religious, Educational, Charitable, Scientific, Literary,	Pleasure, recreation, social activities
Examples	churches, charities, private schools, homeschool co-ops with an educational purpose	Fraternities, sororities, country clubs, hobby clubs, homeschool support groups
Requirements	No private inurement allowed. Upon dissolution all assets must be distributed to another 501(c)(3) organization.	Personal contact, fellowship and co-mingling of members. No private inurement allowed.
Activities	Can hold programs, sell services and products as part of their exempt purpose.	Can provide meals or services only to members in connection with club activities
Tax deductible donations allowed	Yes	No
Tax exempt (no taxes on profits)	Exempt from Federal income tax unless the organization has unrelated business income	Exempt from Federal income tax on income derived from members; other income taxed
Source of Income	Membership fees, fees for services, donations, fund raisers, program fees	Primarily (65% or more) from membership fees.
Membership	Open to public	Limited membership and consistent with the purpose of the club.
IRS Application Required?	Yes, if gross revenues over $5,000/year. File Form 1023	No. The IRS does not require 501(c)(7) organizations to file an application. They can “self-proclaim” tax exempt status.
Annual IRS Reporting	Form 990N, Form 99EZ or Form 990	Not required
Legislative Lobbying permitted?	Insubstantial lobbying allowed (less than 20% of total expenses). No endorsement of a candidate.	No limit on legislative activity as long as it furthers the exempt purpose

I hope that helps!

Carol Topp, CPA

Are Homeschool Support Groups Automatically Tax Exempt?

I help homeschool groups file for tax exempt status with the IRS.

Most of them want 501(c)(3) status as a “qualified charity” because they have an educational purpose and desire tax deductible donations, tax -free profits and sometimes other perks that come with 501(c)(3) status.

But their is another type of tax exempt status that may apply to some homeschool organizations: 501(3)(7) Social Club.

This status allows an organization to be tax exempt (no taxes to pay on their profit), but they cannot offer a tax deduction for donations.

Here’s what it takes to be classified as a 501(c)(7) Social Club:

1. Purpose is for pleasure, social or recreation. A nonprofit motive and no part of the net earnings may inure to the benefit of any person having a personal and private interest in the activities of the organization

There must be an established membership of individuals, personal contacts and fellowship. A commingling of the members must play a  major role in the life of the organization.

Common examples include  college fraternities or sororities, country clubs, garden clubs, hobby clubs, etc.

2. Limited membership: membership is limited and consistent with the character of the club

3. Supported by membership fees. In general, your club should be supported solely by membership fees, dues, and assessments. A section 501(c)(7) organization can receive up to 35% of its gross receipts from sources outside of its membership without losing its tax-exempt status. For example, up to 35% of your total revenues can come from fund raising.

4. Business activities. If your club will engage in business, such as selling products or services, it generally will be denied exemption. However, your organization can provide meals, refreshments, or services related to its exempt purposes only to its own members or their dependents or guests.

5. Tax treatment of donations. Donations to exempt social and recreation clubs are not deductible as charitable contributions on the donor’s federal income tax return.

Sources:
http://www.irs.gov/pub/irs-tege/rr58-589.pdf
http://www.irs.gov/publications/p557/ch04.html#en_US_2010_publink1000200325
http://www.irs.gov/irm/part7/irm_07-025-007.html

These criteria might fit a homeschool support group. The members are limited to homeschool parents (or interested in homeschooling), meet for social reasons, are supported by membership fees (and maybe a little bit of fund raisers), do not sell products or services and do not collect tax deductible donations.

So most homeschool support groups can be considered 501(c)(7) Social Clubs.

Most homeschool co-ops do not fit this description because they sell services (classes) and have an educational purpose, not a social or recreational purpose. They may qualify for 501(c)(3) tax exempt status as an educational organization.

Confused about whether your organization is a 501(c)(3) “qualified charity” or 501(c)(7) Social Club?

This chart may help:  Compare 501c3 to_501c7

Here’s the good news: If your organization fits the bill to be a 501(c)(7) Social Club, you do not have to do any of the IRS application filings like 501(c)(3) organizations must do. You are allowed to “self-proclaim” tax exempt status.

Carol Topp, CPA

Meet Carol Topp at a homeschool convention near you!

I’ll be speaking at the following homeschool conventions in 2011:

• Mid South Homeschool Convention March 3-5, 2011 in Memphis, TN

Topics:

Homeschool Leader: Are You Burnt Out?

Micro Business for Teens

• Midwest Homeschool Convention March 31-April 2, 2011 in Cincinnati, OH

Topics:

Homeschool Leader: Are You Burnt Out?

Micro Business for Teens

• Ultimate Homeschool Expo (online) May 2-6, 2011

Topics:

How a Homeschool Co-op Can Bless Your Child

What Your Child Can Learn from Starting a Micro Business

Career Exploration for Homeschool High School Students

• Schoolhouse Expo (online) May 16-20, 2011.

Topic: Micro Business for Teens

• Home Educators of Virginia, June 9-11, 2011 in Richmond, VA

Topics:

Micro Business for Teens: Starting and Running a Micro Business (2 parts)

Budget is a Dirty Word

Help! My Homeschool Group is Growing

How to Teach Your Kids About Managing Money (When You’re Not Doing So Great Yourself)

Paying co-op leaders

Hello,
I am the leader of a support group with around 65 families.  Our group has a board of elders and by-laws.  We also have a co-op of about half the members of the larger group.  The co-op requires members to be a member of the larger group.  The co-op has separate leadership and it’s own checking account. The by-laws don’t address the co-op specifically.

The co-op pays the leadership and teachers from their account.  Tuition and fees are charged for participating families.  Teachers are written checks from the co-ops account monthly. “Teacher Gift” is always written in the memo in the checks. For the most part, curriculum for the classes are decided upon by the leadership of the co-op. Those in the leadership of the co-op serve no other volunteer function in the main group (their leadership on the co-op has been counted as their volunteer service for all the 7 years the co-op has existed ). Another member of the group has complained that their paid leadership service is not volunteer service and should not be counted toward the main group.  I do agree with this.  But it seems that we need to address this and some other issues that aren’t quite right.

Should our groups separate?  The larger group has not reviewed the co-op’s financial records. The co-op only gave out 1099′s last year for the first time.  I know that whatever is done, there will be hurt feelings and I am at a loss to know where and how to tackle these issues.  Where and what should I start with?

Thanks in advance.

Tina

Tina,

Here’s my advice:
Read my ebook Paying Workers in a Homeschool Organizations. Available as a pdf for immediate download for $7.00 at
http://homeschoolcpa.com/bookstore/paying-workers-ebook/

Good for your group for finally giving 1099MISC to the teachers!  But you should stop writing “Teacher Gift” in the memo. These are not gifts. They are payments for services.

In my experience, it is untypical for homeschool co-op leaders to be paid. That is because most co-ops cannot afford to pay leaders. Instead, many leaders receive discounted tuition (or free classes) in appreciation for their volunteer efforts.

Since you are paying these leaders, they are employees, not independent contractors as your teachers apparently are (although this statement concerns me: “curriculum for the classes are decided upon by the leadership of the co-op.” It sounds as if they are employees and not independent contractors). Employees require quite a bit more paperwork and may involve paying unemployment tax and workers compensation taxes. I discuss the difference between independent contractors and employees in the Paying Workers ebook.

You asked: “Should our groups separate? The larger group has not reviewed the co-op’s financial records.” Obviously the larger support group has neglected some of their responsibilities. See my blog post on leader responsibilities here:
http://homeschoolcpa.com/what-are-the-legal-responsibilities-of-homeschool-leaders/ Perhaps it is time to weigh the pros and cons of being separate. A lot goes into that decision.

You also said: “Another member of the group has complained that their paid leadership service is not volunteer service and should not be counted toward the main group. I do agree with this. But it seems that we need to address this and some other issues that aren’t quite right.”
You are correct that you cannot pay a volunteer, so perhaps the volunteer service is not fulfilled because they are paid.

If you wish to discuss your group’s issues and concerns, I do offer private phone consultation with homeschool leaders. It’s one of my most popular services. Read more about it here: http://homeschoolcpa.com/services/consultation/

I hope that helps.

Carol Topp, CPA
HomeschoolCPA.com Helping homeschool leaders
————

Hi,

I wanted to thank you so much for writing back and give a little update.  The officers met and decided to work at correcting any errors we may be making.  We have a meeting scheduled with the co-op directors in the next couple of weeks.  I think it is so important to set a good example in everything you do.

I do want to add that I was incorrect in that the co-op leaders receive tuition waivers instead of being paid.  Once we get all the information on the finances, then we can make the necessary decisions about our groups.  I am praying for a smooth road.

Your website is very helpful and I have shared it with all the officers of our group.   We are so very appreciative.

Tina

Homeschool Co-ops featured on Homeschool Channel TV

I was interviewed by Mary Jo Tate of Homeschool Channel TV talking about homeschool co-ops!

We discussed the pros and cons of co-ops, how to evaluate if a co-op is right for your family, how to avoid burn out and how to start your own co-op.

Read a sample chapter from Homeschool Co-ops: How to Start Them Run Them and Not Burn Out
Sample Chapter

Order a copy of Homeschool Co-ops in print or ebook.

Print Retail price: $12.50

Ebook price $10.00

Order here

What business structure and tax forms are needed for a new homeschool co-op?

Hi,

I am a 15 year homeschooling veteran who started a co-op last fall.  I am now being asked by my church for ‘official’ documents to include:  business status, liability insurance, tax information.  I have a checking account for our co-op.

We offer 30 classes, one day a week, for 5 hours.  Six of the 30 classes are paid classes.  The student gives the co-op ~$2.00 each class.  I write a check to the teacher for $20.00 each time they teach.  The teacher always makes $20.00.  The student pays a varying rate dependant upon how many students are in the class.

What business status do I need?

What tax forms am I required to file?

What type of liability insurance do I need if the parents are always on site and never drop off students?

Thank you greatly for the information.

Sincerely,

Lauren T

Are you burned out? Know the symptoms

As a guest blogger at The Homeschool Classroom, I wrote a blog entry about leader burnout.

Here’s an excerpt:

It is important to distinguish between temporary “busy-ness” or fatigue and full fledged burn out, which is accumulated strain and stress that affects other areas of your life. After nearly every co-op day, I feel exhausted. One fellow board member takes a nap after co-op, but she is only temporarily fatigued. We joke that we love when co-op starts, but we also love when it ends!

A symptom of burn out would be the loss of the initial enjoyment and anticipation that co-op day should bring. I know that I am tired at the end of a long co-op day because I have invested so much into my students. I really enjoy teaching and I experience a “good” type of fatigue.

To read the entire post, go here: Leader Burnout

Need help avoiding burnout? Read Homeschool Co-ops: How to Start Them , Run Them and Not Burn Out.

Available as an ebook or in print here.

Carol Topp

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