Financial Reminders - Jan 22
Hello PTCO/PTO Executive Boards & Principals, Congratulations on making it through the 1st half of our 2021-22 year. We certainly know this year has come with its’ own set of challenges and we wanted to thank you for your continued flexibility as we all strive to support the students of Cherry Creek during these unprecedented times. As we enter the 2nd half of the year, we wanted to send out a few financial reminders.
As a federally recognized 501c3 tax-exempt group, your PTO is required to comply with federal and state tax law to maintain tax-exempt status and avoid penalties. As such you are responsible for:
Reinvesting donated assets per your 501c3 recognition. As PTCO/PTO's your stated mission is for the educational support and enrichment of the students at your school. Therefore, the greatest portion (85-90%) of revenues must be invested into your school for educational resources and support. Nominal donations may be made to other 501c3 recognized organizations such as the CCSD Foundation or toward CCSD bond initiatives as they also support your mission on a larger scale. Donations to other 501c3’s are prohibited, and your PTCO/PTO bank accounts are prohibited from acting as a pass-through account.
Maintaining accurate and detailed records of all gross receipts and expenditures including funds granted to your recipient school or other 501c3. Work with your school’s Bookkeeper/Office Manager to review PTCO/PTO accounts held at the Dist. level to ensure grants are fulfilled in a timely manner and that any unallocated balances are returned to the PTCO/PTO prior to the fiscal year end.
Issuing 1099-NEC forms by January 31st to any unincorporated independent contractors/vendors paid $600 or more in a calendar year (Jan. 1st-Dec. 31st, 2021, not per our fiscal year).
Holding a State of Colorado Sales & Use license and filing sales tax returns if your PTCO/PTO will be selling personal property including food & beverages, this does not apply if you strictly receive donations or sponsorships. Colorado generally does not impose a state sales tax on services. Some Colorado home-rule cities (that collect their own local sales tax) charge a sales tax on certain services. Contact those cities directly for further information.
If you hold a license, you may request a Certificate of Exemption to be exempt from paying state, county, RTD and SCFD taxes but you must contact your home-city to determine if local sales tax would still apply.
If you hold a license, you must file sales tax returns or a Zero-return per your license file frequency:
$15 or less per month: Sales tax returns may be filed annually. Annual returns are due January 20. (Zero-Returns)
Under $300 per month: Sales tax returns may be filed quarterly.
$300 or more per month: sales tax returns must be filed monthly. Monthly returns are due the 20th day of month following reporting period.
Not required but best practice, provide written acknowledgement for contributions, especially for any single donation of $250 or more in the prior calendar year by January 31st. A donor cannot claim a tax deduction without a written acknowledgement containing:
The name of organization
The amount of cash contribution
A description (but not the value) of non-cash contribution
A statement that no goods or services were provided by the organization in return for the contribution, if that was the case
A description and good faith estimate of the value of goods or services, if any, that an organization provided in return for the contribution.
As always, if you have any questions or concerns, please contact your Parents’ Council liaison or the Parents’ Council Treasurer at firstname.lastname@example.org. We look forward to seeing you all at our upcoming meeting on February 9th. Thank you, Traci Tolbert - Webmaster, Parents' Council Michelle Austin & Breezy Caldwell - Co-Presidents, Parents' Council Cherry Creek Parents' Council Board