Are homeschool groups “schools”?

Some homeschool groups look a lot like schools. They offer a full curriculum, there are teachers teaching classes, they rent space to conduct the classes, etc.

So is a homeschool program a school?

I’m a CPA, so I tend to follow the IRS definition of “school.” This blog post is filled with lots of IRS-ese. Dig in and slog through the details if you wish or just scroll to the bottom for my answer.

 

IRS definition of “school” is found in the Internal Revenue Code Section 170 https://www.irs.gov/irm/part7/irm_07-026-002.html#d0e549

IRC 170 (b)(1)(A)(ii) Exclusion—Educational Organizations

  1. Educational organizations described in IRC 170(b)(1)(A)(ii) and Reg. 1.170A–9(b)(1), such as primary schools and universities, are excluded from private foundation status under IRC 509(a)(1).
  2. IRC 170(b)(1)(A)(ii) organizations are commonly known as “schools.”
  3. An IRC 170(b)(1)(A)(ii) organization must:
    1. present formal instruction as its primary function,
    2. normally maintain a regular faculty and curriculum, and
    3. normally have a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on

IRC Section 170 reference Reg, 1.170A-9(b)(1) which states:

An educational organization is described in section 170(b)(1)(A)(ii) if its primary function is the presentation of formal instruction and it normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on. The term includes institutions such as primary, secondary, preparatory, or high schools, and colleges and universities. It includes Federal, State, and other public-supported schools which otherwise come within the definition. It does not include organizations engaged in both educational and noneducational activities unless the latter are merely incidental to the educational activities. A recognized university which incidentally operates a museum or sponsors concerts is an educational organization within the meaning of section 170(b)(1)(A)(ii). However, the operation of a school by a museum does not necessarily qualify the museum as an educational organization within the meaning of this subparagraph. (emphasis added)

In the Instructions to Form 1023 Application for Recognition of Exemption Under Section 501(c)(3), the IRS gives a clearer definition of a school:

An organization is a school if it:

  • Presents formal instruction as its primary function.
  • Has a regularly scheduled curriculum.
  • Has a regular faculty of qualified teachers.
  • Has a regularly enrolled student body.
  • Has a place where educational activities are regularly carried on.

The term “school” includes primary, secondary, preparatory, high schools, colleges, and universities. It does not include organizations engaged in both educational and non-educational activities, unless the latter are merely incidental to the educational activities. Non-traditional schools such as an outdoor survival school or a yoga school may qualify.   The term “school” does not include home schools.

Answer “Yes” if you have a regularly scheduled curriculum, a regular faculty of qualified teachers, a regularly enrolled student body, and facilities where your educational activities are regularly carried on. Submit evidence establishing that you meet these factors, as described below:

  • Evidence that you have a regularly scheduled curriculum includes a list of required courses of study, dates and times courses are offered, and other information about how to complete required courses.
  • Evidence that you have a regular faculty of qualified teachers, includes certifications by the appropriate state authority or successful completion of required training.
  • Evidence of a regularly enrolled student body includes records of regular attendance by students at your facility.
  • Evidence of a place where your exclusively educational activities are regularly carried on includes a lease agreement or deed for your facility.

If you answer “No,” do not complete Schedule B. You do not meet the requirements of a school and you will need to go back to Part X, line 5, to reconsider your public charity status.


I highlighted a few portions to emphasis a crucial point. Most instructors at homeschool organizations do not fit the definition of “qualified” faculty because they are not certified teachers by the state and may not have training in the subject they are teaching. That doesn’t make them unqualified for your purposes; it just doesn’t fit the IRS’s definition of “qualified.”

I do not consider most homeschool programs to be schools.


If homeschool programs are not schools, what are they?

They are educational organizations.

 

Carol Topp, CPA

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