California homeschool leaders: A webinar just for you!

For California homeschool leaders: I have something special for you!
A free webinar
on

Money Tips and Traps for Homeschool Organizations

Monday December 3, 2018 at 6:30 pm California time

and
Carol Topp, CPA, the HomeschoolCPA

 

The webinar is for all homeschool leaders of co-ops, support groups, CC Communities, sports, music, clubs, etc! Whether your group is large or small, new or mature, you can learn something new or improve on what you are currently doing!
The webinar will cover:
  • Tips for managing the money in your homeschool group
  • Board duties (what leaders should be doing!) concerning money
  • What financial reports California requires
  • What reports you should be filing with the IRS
  • Money traps to avoid
  • Taxes and tax exempt status
  • Paying workers
  • Avoiding errors and embezzlement

There will also be time for your questions and answers!

The webinar will be held  Monday December 3, 2018 at 6:30 pm California time
You can join my phone, PC, Mac, iphone, iPad, etc. from wherever you are!

 

The webinar is free, but you must register to be emailed the link.

 

In addition the webinar will be recorded, so be sure to register so you get the recording link emailed to you!
If you can’t attend the live webinar, still register, so you will be sent the link to view the webinar later.

 

I hope you can join me on Monday December 3, 2018  at 6:30 pm PT
Thanks to CHEA for hosing and helping put on his webinar for homeschool leaders!

 

Register today even if you can’t join us live so you will get the link to the recording.

 

Carol Topp, CPA
HomeschoolCPA.com

How should a homeschool co-op set up their Quickbooks account?

Do you have something on your website or a resource on how a co-op should set up their QuickBooks accounts?

Michelle

 

Michelle,

I have a few posts about how to set up QuickBooks for a homeschool co-op:

Quickbooks Tips for Homeschool Groups on Sales
What financial reports do we need to generate monthly?

If you receive money in one year, but it’s really for next year (like early registration) then this is helpful:
Deferred Revenues in QuickBooks (opens a pdf file)

 

I actually don’t spend a lot of time talking about QuickBooks on this blog because there are so many good resources our there like this one (check out her QuickBooks tutorials):

5MinuteBookkeeping

A nonprofit called TechSoup has some great videos for using QuickBooks in a nonprofit:

https://www.youtube.com/playlist?list=PLRCtupIatuLkSlhtlXDyo7P7woeHORwgn

Finally, my book Money Management in a Homeschool Organization  has some tips for using QuickBooks like setting up a Chart of Accounts and a who are your “Customers” and what are your “Sales.”
I hope that helps,
Carol Topp, CPA

Should your homeschool group be collecting sales tax?

Sales tax. Ugh!! As if dealing with the IRS and income tax isn’t enough of a headache, your homeschool organization might need to be collecting and paying sales tax as well!

From the Church Law and Tax blog comes some helpful information about sales tax that applies to homeschool organizations.

Sales taxes are collected in 44 states. Each state has a different sales tax statute and exempts certain types of purchasers from the payment of sales tax.

Some states exempt any organization with 501(c)(3) status from paying sales tax on purchases. Other states offer limited sales tax exemptions.

Collecting Sales Tax

But I’m not talking about paying sales tax when you buy stuff like paper towels or microscopes.

I’m talking about when your homeschool group sells stuff (aka tangible personal property).

What kind of stuff? How about:

  • Text books (some states exempt textbooks form sales tax.)
  • Tickets to drama performances (yes, some states add sales tax to ticket sales!!)
  • Food sales (in some states food sales, especially snack foods and soft drinks are sales-taxable)
  • T shirts, even if they are a fundraiser!

The rules for when an organization is exempt from collecting sales tax are different form the rules about paying sales tax.

Most states do not exempt churches from collecting sales tax on taxable transactions. As a result, a church that conducts taxable transactions is required to have a sales tax permit.

Most states have a nuisance exception to the requirement of having a sales tax permit, which allows churches to have taxable sales a couple of days a year without the requirement of collecting sales tax. Since every state is different, you should check with your state revenue department. (Source: https://www.churchlawandtax.com/web/2008/september/exceptions-to-exemption.html)

 

For example: In Ohio a homeschool co-op with 501(c)(3) tax exempt status can buy things (like books, supplies, etc) without paying sales tax.

But Ohio only allows nonprofits 5 days a year to hold sales without collecting sales tax. It’s kind of like they are saying, “use those 5 days wisely…you only get 5 sales-tax free days to sell stuff each year!” So maybe the co-op wants to have a big fundraising event and sell items. That’s one of the 5 days they can sell items and not have to collect sales tax.

 

Sales Tax on Fundraiser Sales

You may be thinking your homeschool group can avoid collecting sales tax because you only sell things as part of a fundraiser. Sorry, bed news…

Virtually any form of fundraiser that involves the sale of a product will also require the collection of sales tax. (Source: https://www.churchlawandtax.com/web/2008/september/exceptions-to-exemption.html)

Sales Tax Laws vary by State

Each state has different rules about how and what they apply sales tax to and what organizations can be exempt from collecting sales tax.

It will take some detective work to figure out what your state’s rules are! It’s one of the headaches of living in a country with 50 states (and Washington DC!).

How to Get Help

  • Start with your state’s department of revenue website. Look for words like “sales tax” and then “exemptions” Then look for words like “nonprofit” and “exemption.” Happy reading. The states don’t make it easy to find the exceptions to taxes!
  • Google “Sales tax exemption nonprofit YOUR STATE” and start hunting.
  • I find TaxJar.com and Avalara.com are two helpful websites with information on sales tax.
  • Contact me, Carol Topp, CPA. I’ve done the detective work for several states (about 30) and can sometimes help you or at least point you in the right direction. I charge a fee for this research of $50.

Carol Topp, CPA

HomeschoolCPA.com

QuickBooks tip for homeschool groups: Sales

 

Here’s a  tip for all you homeschool groups using QuickBooks (or something similar like Apolos or Wave)

In the homeschooling world don’t usually think of our members as “customers” but that’s what QuickBooks calls them.

Members = Customers

We also don’t think of collecting registration dues or field trip fees as “sales” but that’s what QuickBooks calls it when you collect money and provide a service.

Registration Fees = Sales Income

Field Trip fees = Sales Income

Co-op Class fees = Sales Income

You should set up several categories on your Chart of Accounts for different types of Income. You may want to change the titles of Income accounts in QuickBooks to match your program. So instead of “Sales” Use “Program Income” or just plain “Income”

Make use of subaccounts under Income for things like

  • Membership dues
  • Co-op Tuition
  • Field Trips Income
My book Money Management in a Homeschool Organization  has some tips for using Quickbooks like setting up a Chart of Accounts and a who are your “Customers” and what are your “Sales.”

Carol Topp, CPA

HomeschooCPA.com

 

 

Hybrid Homeschool Programs: How to Use Them Successfully

 

The Old Schoolhouse magazine published an article I wrote on article I wrote on hybrid homeschool programs

Hybrid homeschool programs are a mix of education done at home and classes outsourced to:

  • online classes
  • a homeschool drop-off program
  • a homeschool tutorial or university-model program
  • classes at a local private or public school or college

In the article I discuss the popularity of hybrid programs and the challenges as well.

Then I conclude with some advice and warnings including:

  • delaying hybrid classes until age junior high or older
  • delaying hybrid programs until you’ve been homeschooling a year or two.
  • a reminder that you can successfully homeschool without using a hybrid program!

I thought long and hard before writing that advice.

I may get some push back on my recommendations, but having seen homeschooling grow and change over the years, I’m trying hard to encourage homeschooling parents to embrace the freedom and joy that comes from educating your children–especially the young ones–yourself!

Don’t let a hybrid program steal that freedom and the joy!

Read the article here: Hybrid Homeschool Programs article

Carol Topp, CPA

Top 5 risks to churches (and maybe your homeschool group as well)

From the Managing Your Church webpage, I learned the Top 5 Reasons Churches are Taken to Court.

Maybe they are a risk to your homeschool group as well.

In 2017, the top five reasons were

(1) sexual abuse of a child,

(2) property disputes,

(3) personal injuries,

(4) zoning disputes, and

(5) insurance disputes.

 

The article goes on to say:

Churches must be aggressive (in preventing child abuse). Any reasonable suspicion of child abuse must be reported immediately. It doesn’t matter if you or your colleagues are defined as a mandatory reporter in your state or not. Report it. Transfer the risk to the state in terms of what can be done about it.

I think that advice applies to homeschool groups, as well.

Please, please protect the children in your program and get training on how to spot and deal with child abuse.

The article lists the following resources (check with your church host; they may already have some of these resources):

Reducing the Risk, a comprehensive child abuse prevention training program (available in DVD format or online streaming)

50-State Child Abuse Reporting Laws Survey for Clergy and Church Leaders (available as a PDF download or for ChurchLawAndTax.com subscribers)

Church Board Guide to a Child Sexual Abuse Prevention Policy

Child Sexual Abuse Response Plan

Draw the Line: Relational Boundaries for Safe Youth Ministry

Let’s work hard to keep children safe.

Carol Topp, CPA

HomeschoolCPA.com

A homeschool group is using free Paypal. Is that legit?

Hi Carol!

Our small homeschool group set up our business account with PayPal to collect payments from our families.

A friend/homeschool leader said we should accept money through the “friends and family” option on PayPal and avoid the PayPal fees. I didn’t even realize this was an option for a business account, but it is. I’m not sure if that’s legit. 

What scenario would I ever accept money via friends and family?

Thanks so much for your service to us homeschooling mamas!

-V, a homeschool group leader

 

Dear V,

Since you are accepting payment for rendering a service, you cannot avoid the PayPal fee.

To use the “friends and family” option would be deceitful.That option is for true transfers of money among friends, but not if your group is getting paid for rendering a service.

No one likes paying fees, but PayPal is doing your organization a service (processing credit card or debit card payments) and you should expect to pay for that service. You may have to increase your fees to the families a bit to cover the extra expense, but paying the Paypal fees is the correct, proper and legal way to run your homeschool group.

Carol Topp, CPA

HomechoolCPA.com

 

Have more questions about managing the money in your homeschool group? My book Money Management in a Homeschool Organization may be just what you need!

Money Management for Homeschool Organizations

Does your homeschool group manage their money well? Do you have a budget and know where the money is spent? Do you know how to prevent fraud? This 115 page book will help you to open a checking account, establish a budget, prevent mistakes and fraud, use software to keep the books, prepare a financial statement and hire workers. Sample forms and examples of financial statements in clear English are provided.


Paperback $9.95

Ebook(pdf) $3.99

Kindle $3.99

 

 

Motivation to homeschool is changing. How does your group adapt?

Homeschool is changing! I know that you as a homeschool leader see those changes.

In her 2012 book Home Is Where the School Is, sociologist Jennifer Lois broadly divided homeschoolers into two groups: first-choice and second-choice homeschoolers.

A 2017 Pioneer Institute whitepaper characterized the groups this way: “The ‘first-choice’ family is in essence the traditional homeschooling family, viewing homeschooling as a lifestyle and an integral part of a student’s growth.

‘Second-choice’ homeschooling parents might be described as ‘pragmatic homeschoolers,’ perhaps even ‘reluctant homeschoolers.’ . . . this sub-set tends to view homeschooling as a stop-gap solution to a school-based problem as opposed to an overall family lifestyle.”

As more people start homeschooling for different motivations other than as a lifestyle, raising life-long learners, or faith, how does your group adapt?

Are you accommodating the parents who are just looking for a stop-gap solution?

Here is what some groups are trying:

  • Allowing more drop off students  and less parental involvement
  • Hiring more paid teachers
  • Offering more parent education on how to homeschool
  • Opening their formerly exclusive groups to allow public-school-at-home families to join

Share your ideas in the comments or join the I Am a Homeschool Group Leader group on Facebook and leave a comment.

 

Carol Topp, CPA

Helping Homeschool Leaders

Blurring Lines of What is Homeschooling

 

On the I Am a Homeschool Group Leader Facebook page, a lot of discussion happened around the topic of being an inclusive group (open at all) or exclusive group (limiting membership). Several homeschool leaders contributed the reasons for their group’s decision. Carol Topp shared those views in Episodes # 129 and #130 which you can find here:

Reasons to be an Inclusive Homeschool Group

Reasons to be an Exclusive Homeschool Group

In this episode of the HomeschoolCPA podcast, Carol Topp will share some of the reasons that some groups are exclusive (they do not allow public school students into their homeschool group) but it comes from a few people who are active in legislation or in their state homeschool groups. They have a different viewpoint that you may find insightful and interesting.

These state homeschool leaders mentioned:

  • The lines of what is homeschooling are blurring and state legislators may not understand the difference between traditional or independent homeschooling and public-school-at-home.
  • There are concerns about government control and oversight
  • There is a concern of being grouped with charter schools or public school funding and therefore be subject to more government oversight

 

 

In the podcast Carol mentioned the Facebook  group for homeschool leaders I am a Homeschool Group Leader. Join 400+ homescool leaders for ideas, encouragement and respective exchange of ideas. https://www.facebook.com/groups/72534255742/

 

Featured resource:

Phone Consultation with Carol Topp, CPA

You can learn a lot about running your homeschool group from the HomeschoolCPA podcast and website (and books) , but sometimes you just need to TALK to someone who understands homeschooling, running a group and the laws surrounding the finainces and operations of homeschool groups. Why not call Carol Topp, the Homeschool CPA, to set up a personal call?

Carol is happy to set up a conference call so several of your leaders can join in from their own homes. The call can be recorded or future reference or for those who are unavailable. This is Carol’s most popular service for homeschool leaders. It’s like having your own homeschool expert CPA on the phone!

Cost: $75/hour to nonprofit organizations.  $100/hour to for-profit businesses. $60 minimum.

Contact HomeschoolCPA, Carol Topp, CPA, to arrange a telephone consultation.

Click Here to request more information!

Carol Topp, CPA

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Is our homeschool group required to have a president?

I recently purchased your ebook The IRS and Your Homeschool Organization. It is so helpful! I do have one question that I hope you can help me with. Are we required to have a president for our organization in Ohio? I see lots of websites saying that we do but not a word about it on any of the actual Ohio documents.

Thank you for your time.

Ashley

 

Dear Ashley,

You asked, “Are we required to have a president for our organization in Ohio. I see lots of websites saying that we do but not a word about it on any of the actual Ohio documents.”

Well, not everything that is a good idea is a codified into a law or specifically spelled out in a document! Like brushing your teeth  for example! 🙂

This document from the Ohio attorney general’s office is helpful.
Guide for Charity Board Members

It explains that there are duties and responsibilities for board members such as the duty of care, duty of management and duty of compliance with stated laws.

If you can execute those duties without a president, then you do not have to have a president. But it is nearly impossible to properly run a nonprofit without someone in the role of chair/president calling meetings, setting an agenda, running the meetings, providing oversight, etc.

So why not have a president (or chair)?

Of course, all the board members are expected to help run the organization. The president should not do it alone. The best board presidents I have served under were good at delegating, listening, and leading, but not doing everything themselves. The worst presidents or board chairs are those who decide everything themselves and try to control too much. They burn out and sometimes damage the group and its activities for a very long time.

There may be some back story and history (or even a dispute) to your question, so if you’d like I would be happy to arrange a phone consultation with you.

If your homeschool program would like to arrange a phone consultation with Carol Topp, CPA contact her here. She is happy to arrange a conference call and each persona can call in form heir own home or location. The conversation can be recorded for those unable to attend.

 

Carol Topp, CPA
HomeschoolCPA.com