California State PTA’s Treasurer, Melinda Kirkland, has been getting lots of financial questions from local leaders as they begin to navigate online meetings and event cancellations.
Today she is sharing with us information about what to do with items donated for cancelled events, and PTA policies on donating to other nonprofits and/or to families in need.
For more information on holding meetings during the COVID-19 restrictions, visit our website.
Events and Donated Items
Q: What do we do with donated items now that we can no longer have the event they were donated for (like our silent auction)? Do we need to vote to cancel the event even though we can’t hold it due to school closures and COVID-19 restrictions?
A: If the donations were solicited specifically for this event that you are now not able to have and not as “general” donation to the PTA, the PTA needs to contact the donors (all of them) and ask them what they would like you to do with the donated items. This is easiest via email, because then you will have written instructions from the donor, which is really what you need. If the donor wants the items returned, you have to give them back. If they give you permission to keep them/use them as needed, then you can vote as an association how to “repurpose” those donations at a future time.
You do not need a vote of the association to cancel a fundraiser/event that you are no longer able or allowed by law to hold. You would only need a vote on how to distribute/use any donations that were not returned to donors. FYI: only donations that you keep have to be reported on tax filings. Returned donations do not need to be reported.
Donations to Other Nonprofits or Families in Need
Q: Can our PTA donate to other community non-profits who are taking lead roles in supporting the many under-served families in our district? Can we offer some sort of direct support to members (individuals and families) of need in our school communities?
A: The IRS is very clear that a 501(c)3 public charity (which all PTAs are) may donate funds to another 501(c)3 public charity with a similar mission. That means that a PTA can donate money only to nonprofits who have similar purposes. For example, you could not donate to the Red Cross, but you could donate to a non-profit children’s library, provided it had 501(c)3 status.
Likewise, the IRS is very clear that a public charity may not gift funds to individuals or families unless that is what the charity was organized to do. PTAs are not organized for that purpose, so we may not give money (including gift cards) to individuals or families in our school communities, regardless of need.
So the PTA may donate to other community organizations if they meet the criteria above (and assuming the association voted to do so), but the PTA could not gift funds to an individual or family.
However, there are several other things that PTAs can do to help and we encourage units to consider the following:
- The PTA may advertise any and all benefits/fundraisers being held for individuals or families in need or local charities who are assisting those in need, regardless of who is organizing them. That includes letting everyone in your community know GoFundMe campaigns, etc.
- The PTA may also help with a fundraiser by advertising it and encouraging volunteers, but it cannot be an official PTA activity and all money collected must go to the organization holding the fundraiser Checks cannot be made out to PTA and no deposits may be made to the PTA account on behalf of another organization or family in need.
- The PTA may sponsor a food/diaper/necessities drive or solicit donations of those items to be given to a local food bank, etc. “Necessities” could include personal protective equipment (PPE) for local hospitals and medical facilities if that’s a need in your area.
Please visit the COVID-19 Resources for PTA Leaders page on our website. There you will find information about holding association meetings via telephone or video conferencing. We’re trying to help our local leaders and members be able to “meet” safely so that they can vote to make donations or redirect funds as needed for their school community, while still complying with legal requirements.