Tiny Homeschool Groups: Do We Need to File Anything?

Tiny Homeschool Groups: Do We Need to File Anything?

Tiny homeschool groups have different challenges than large programs. They are limited on resources, volunteers, and activities. But they still have questions about legal status, money and taxes that the large homeschool organizations have.

In this 4-part podcast series, Carol Topp, CPA answers the common questions that tiny homeschool groups face. All podcasts are available at HomeschoolCPA.com/Podcast

  • Episode #175 Are We a Nonprofit?
  • Episode #176 Do We Need to File Anything?
  • Episode #177 Do We Need to Pay Taxes?
  • Episode #178 Do We Need a Bank Account?

In this episode of the HomeschoolCPA podcast, Carol Topp discusses:

  • Bylaws do not typically need to be filed anywhere. They are an internal document. Sample bylaws for a homeschool group
  • Articles of Association (if you remain an unincorporated association) or Articles of Incorporation (if you formed a nonprofit corporation in your state). Samples available here
  • Charitable solicitation registration if you solicit donations or hold fund raisers in your state. Get information on your state’s filing requirements from https://www.harborcompliance.com/information/nonprofit-compliance-guide
  • Business licenses for nonprofits (only 6 states require a business license)
  • Employer Identification Number. Helpful tips.

 

Join the Facebook group for homeschool leaders: I am a Homeschool Group Leader. 600+ homeschool leaders offer ideas, encouragement and respectful exchange of ideas. https://www.facebook.com/groups/72534255742/

 

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Homeschool leader stepping down: Who to notify?

Hi Carol,

I am stepping down from the leadership of my homeschool group and wonder what I need to do. What forms to file, contacts to make, etc. Can you direct me, please? We are a 501c3 in Pennsylvania.

Thanks in advance!

Jill

 

Jill,

Congratulations on your “retirement”! Well done, good and faithful servant. 🙂

There might be quite a few things to do to remove your name from state and IRS documents.

In my ebook Homeschool Organization Board Manual I explain what to do when a board members leaves or the board changes.

This Board Manual might be helpful to your remaining board members since it is a combination of a template for your board to create binders to keep important documents and a board training manual to explain the board’s duties and responsibilities.

 

 

 

It is common for nonprofits to change leaders and signers on the checking account quite frequently, maybe annually! Here’s what you need to do if your board members change.

Notify the Internal Revenue Service (IRS) when you file your annual information return, Form 990-N, 990-EZ or 990 that the board members have changed. You do not have to notify the IRS mid-year; only notify them when you file the 990.  The 990-N electronic postcard only asks for one officer’s name. The Forms 990-EZ and 990 have you list all board members.

Notify your State: Your state may require an annual report to the Secretary of State Office and/or the Attorney General. Often the states require an annual update and on that report you list the current board members. Each state is different, so you’ll have to research the details for your state. Research using this helpful website: https://www.harborcompliance.com/information/nonprofit-compliance-guide

Change Your Mailing Address: You can change your address with the IRS by simply providing the new address on your annual information return, Form 990-N, 990-EZ or 990.

Changing your address with your state may involve several agencies including the Secretary of State and Attorney General. Each state is different, so you’ll have to research the details for your state. You can research using this website: https://www.harborcompliance.com/information/nonprofit-compliance-guide

Change the Responsible Party on your EIN: You can change the responsible person on your organization’s Employer Identification Number (EIN) by filing an IRS Form 8822-B https://www.irs.gov/pub/irs-pdf/f8822b.pdf.

Change your Registered Agent: If you are a nonprofit corporation in your state (meaning you filed official Articles of Incorporation with your state), you assigned a Registered Agent. This is a personal who is a resident of your state and should always know how to reach your organization. Many states list the current Registered Agent on their websites. Do a search on “YOUR STATE Corporate search” then follow links to your state governments’ list of corporations (both for-profit and nonprofit). The list of corporations is usually maintained by the Secretary of State’s Office.

To change the registered agent for your organization, go to your Secretary of State’s website and look for a document called Change of Registered Agent.

Notify the bank: You will probably have to visit your bank in person with the new checkbook signers. They will need identification (like a Drivers License). At that time they can change the mailing address on file.

Make sure you remind the new treasurer to change the password for online access to the checking account as well.

 

I hope that helps!

Carol Topp, CPA
HomeschoolCPA.com
Helping homeschool leaders

How to wrap up your year as treasurer

It’s near the end of the year for many homeschool nonprofit organizations.

Here’s a list of tasks for a treasurer to do to finish the year:

  • Enter all transactions and check to ensure that your bank reconciliations are up-to-date for the entire year.
  • Fill out the IRS 990/990EZ or 990N if required. As the Treasurer, you are the most appropriate person to fill out this annual IRS form.
  • Give a year end summary to your board. My free webinar Financial Reports for Homeschool Nonprofits will show you good, bad and ugly financial reports.
  • Make a list of any items that you or the next treasurer needs to address that might be out of the norm like outstanding checks.
  • Change authorized banking signatures, if needed. Change names on state registrations and the IRS EIN too. How to change responsible party name on EIN.
  • Put together a list of important deadlines like insurance renewal, Form 990 dues date, state registration deadlines, etc. If you are the next year’s treasurer, put these dates on your calendar.
  • Review the next year’s budget with the incoming treasurer. Don’t have a budget? This should help How do I create a budget for my homeschool group?
  • Train the incoming treasurer. My Board Manual  can serve as a board training guide.

My book Money Management in a Homeschool Organization is a guide for treasurers of homeschool organizations. If you don’t have a copy, buy one today. Maybe you’ll say like Mara, a homeschool treasurer in Washington did, “I was also pleased to learn that we are doing many things right!”

 

Carol Topp, CPA

Do we need a new EIN for our new nonprofit corporation?

Our homeschool group already has an EIN (Employer Identification Number), but we recently decided to work toward 501c3 status. We are now incorporated.
Do we need a new EIN or can we just change the name on the one we have?

-Kellie

The IRS, who issues EINs, makes it clear that you need a new EIN when you form a new nonprofit corporation.

You will be required to obtain a new EIN if any of the following statements are true.

  • A corporation receives a new charter from the secretary of state.

Source:

You can get a new EIN online, but it’s helpful to look over the Form SS-4 so you know what questions will be asked.

Carol Topp, CPA

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How can we change the contact name on our EIN?

 

When your homeschool group applied for an Employer Identification Number with the IRS, you had to give a responsible party’s name and their Social Security Number. Now that person is stepping down from your homeschool board.

How do you change the responsible party’s name on your EIN? Carol Topp, CPA explains how in this short podcast (9.5 minutes).


In the podcast, I mentioned Money Management in a Homeschool Organization. It’s a guide for homeschool treasurers that you may find helpful.

Carol Topp, CPA

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How Do I Get a Tax Exempt Number?

How does a nonprofit get tax exempt number from the IRS? They don’t!

In this short podcast Carol Topp CPA explains tax ID numbers and the various state agencies that may assign tax numbers.

Listen to the podcast (9 1/2 minutes)

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How to close down an EIN for a tax exempt organization

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Closing an EIN for a tax exempt organization is described at the IRS website: https://www.irs.gov/businesses/small-businesses-self-employed/canceling-an-ein-closing-your-account 

Information for Exempt Organizations

If you applied for an EIN for an exempt organization that:

(1) never applied for formal exemption,

(2) is not covered in a group ruling, or

(3) never filed an information return (Form 990, 990-EZ or 990-N),

send a letter requesting the closing of your account to:

Internal Revenue Service
Attn: EO Entity
Mail Stop 6273
Ogden, UT 84201

or you may fax it to (855) 214-7520.

State the reason you wish to close your account. If you have a copy of the EIN Assignment Notice that was issued when your EIN was assigned, you should include that when you write. Otherwise, be sure to include the complete legal name of the entity, the EIN, and the mailing address.

 

Read the 3 criteria listed above carefully. If your organization fits all of the criteria, then write a letter to the IRS and give the reason you are closing your EIN. Usually it is because the organization dissolved or ceased its operations or activities.

If you fail one of the criteria, the IRS has different instructions. https://www.irs.gov/charities-non-profits/termination-of-an-exempt-organization.

You will have to file one more 990-N for the old organization and check “Yes” to the question “Has your organization terminated or gone out of business?” If you typically file the Form 990 or 990-EZ, than check the Terminated box in the header area on page 1.

Additionally, you will need to file a Schedule N, Liquidation, Termination, Dissolution, or Significant Disposition of Assets with your Form 990 or 990-EZ. If you file a 990-N, there is no Schedule N to file.

 

Carol Topp, CPA

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Can a homeschool group just get together without having to report to the IRS?

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Can a homeschool group just get together without having to report to the IRS?

Dorothy

 

Dorothy,

Yes, a group of homeschool families can just gather together, but the group will be limited in their size and to dealing in cash only.

Very small homeschool groups are more like a play group or group of friends pooling their money to pay group expenses, like a field trip.

I compare it to a group of friends all going out to dinner. They each pitch in to pay the bill. These tiny groups do not file reports with the IRS. Very tiny homeschool groups can operate like this.

In this case, a group may not need an EIN or to open a checking account for the group, but they would be limited in size and limited to cash only. It’s usually when a group needs a checking account that they have dealings with the IRS, because they need an EIN to open a checking account.

I hope that helps,

Carol Topp, CPA

Best of: Checking accounts for homeschool organizations

checkbook07Here’s a collections of my best blog posts on checking accounts for homeschool organizations.

Start with this article about getting a identification number from the IRS before you open a checking account:

Getting an EIN from the IRS

Then read through these blog posts:

Checking accounts and EINs for homeschool groups
Will getting an EIN put us on the IRS radar?
EIN before or after incorporation?
Fraud in a homeschool group
Banker wants IRS letter to open a checking account

Cover Money Mgmt HS OrgYou’ll find more information on managing money in a homeschool organization in my book, Money Management in a Homeschool Organization: A Guide for Treasurers.

Carol Topp, CPA

Incorporated in your state? Time for a new EIN!

IRS

I just updated my article on “Getting an EIN from the IRS”  (on my Articles page) because my original article neglected to mention that your organization needs a new EIN after you incorporate as a nonprofit corporation in your state.

Here’s what I added:

If your group became a nonprofit corporation in your state, then you need a new EIN from the IRS in the name of the new corporation. A corporation is a new legal entity and you need a new EIN to match it. Use the same name as you used when incorporating. Look on the certificate you received from your state for your official legal name.

Read the full, updated article here: Getting and EIN from the IRS 

 

Cover Money Mgmt HS OrgIf you have questions about applying for an EIN or the Form SS-4, read the chapter on “Checking Accounts Done Right” in my book Money Management in a Homeschool Organization

 

If you have questions about setting up or running your homeschool organization, visit HomeschoolCPA.com or consider a private phone consultation with me.