Paypal Account for Pack

[cubmaster.pack600]

Our Pack would like to setup a PayPal account to start collecting dues, and also to be able to accept credit cards at our popcorn Show and Sell. During the registration, it asks for a Federal Tax ID #. Can anyone tell me what Tax ID # they are looking for? Is there an overall Tax ID # for Scouts, or something at our Council level, or is it even something at our chartering organization (elementary school) level?

[Basementdweller]

The Fed ID # would be that of your Chartering organization. Ask permission first as it may impact their 503 status.

 

I used square last year to sell popcorn and did very well. Just be aware of the terms of the Paypal or square accounts....If you take more than $1,000 they will hold the money for 30 days. It does take a couple of days longer for the funds to get to your account than stated.

[King Ding Dong]

You need to check your council and state rules. DO NOT follow the advise of someone that does not know your local regulations. In my state each unit is required to have its own Fed ID and state tax exempt letter. We are not to use the Chartered Organizations information. In a state across the river you may use the Council Tax exempt letter. If your council does not supply this information on its web site call the service center.

[Basementdweller]

Local regs????? Really?????? Federal rules are not a local thing my friend.....

 

So who exactly has told you that each unit is required to have it's own Federal ID and state exempt letter???????

 

 

The Charter organization owns the unit.

 

We use our CO's information locally under guidance from the local BSA council

[King Ding Dong]

Local regs????? Really?????? Federal rules are not a local thing my friend.....

 

So who exactly has told you that each unit is required to have it's own Federal ID and state exempt letter???????

 

 

The Charter organization owns the unit.

 

We use our CO's information locally under guidance from the local BSA council

That is exactly my advise. Follow the guidance of YOUR local BSA council. Not BD's local BSA council.

 

You are truly a wise man BD by following the guidance of your local BSA council. I however would be cautious in giving legal and tax advise to others who may be in a different situation than yours.

 

Who has told me that each unit in MY council is required to have its own Federal ID and tax exempt letter ? My local BSA Council of course.

 

"The state of Missouri requires every Cub Scout pack, Boy Scout troop, Venturing Crew, and Explorer post to have its own sales tax “exemption letter†and “sales tax exemption number.†"

 

"Scouting units are also exempt from sales tax in Illinois; however, the state of Illinois does not require individual units to have their own sales tax “exemption letter†and “sales tax exemption number.†This number authorizes sellers to exempt the tax for items/supplies purchased for your unit, such as patrol food purchases, advancement/unit purchased materials at the Scout Shop, etc.) It is not for individual use, AND clothing is not exempt.

 

Scouting units may use the Greater St. Louis Area Council Illinois Tax Exemption Letter and number: To obtain a copy of this letter, contact the Development Department, Greater St. Louis Area Council–Boy Scouts of America, 4568 West Pine Blvd., St. Louis, MO 63108-2193, 800.392.0895. "

 

"Unit funds should be placed in a checking or savings account in a local bank. To open an account, the unit will need a copy of their charter and a Federal Employer Identification number. Units should apply for their own; more information can be found below under Does Your Unit Need A Federal Tax Identification Number."

 

"DOES YOUR UNIT NEED A FEDERAL TAX IDENTIFICATION NUMBER? THE ANSWER IS YES…"

 

http://www.stlbsa.org/volunteers/currentvolunteers/unit%20finances/pages/tax-information-for-unit-leadership.aspx

[Basementdweller]

Odd how that council does it.

 

Our CO is a church we use the tax exempt number and their EIN for everything.

 

I suppose things are different when your a PTA/PTO charter,

[King Ding Dong]

Odd how that council does it.

 

Our CO is a church we use the tax exempt number and their EIN for everything.

 

I suppose things are different when your a PTA/PTO charter,

PTO has nothing to do with it. This applies to all units. MO requires each unit to have its own tax exempt, IL doesn't seem to care.

 

States do have their own banking laws to some extent and that may have something to do with the EIN. I would imagine having finances as separate as possible provides some level of protection for the CO.

 

Maybe our council is odd or maybe your council is odd. We could start a thread and poll how other councils do things, but what's the point ? You do what your council says to do.

 

GSLAC is a fairly large council with 12 districts I doubt they are out doing crazy, rouge stuff.

[Scouter99]

Odd how that council does it.

 

Our CO is a church we use the tax exempt number and their EIN for everything.

 

I suppose things are different when your a PTA/PTO charter,

I'm going to start calling you two Archie and Edith. hehehehe

[Pack18Alex]

My Pack has a Banking EIN "for banking purposes only" linked to the EIN of our Charter Org, but that was because of some stupidity at the Charter Org level. If your Bank is under the EIN of your CO, then your Paypal Account that links into that Bank Account should be with the EIN of your CO. If you have an EIN for Banking purposes only, use that EIN.

 

If you use your CO's EIN (and your CO isn't a 501©3 Church), consider getting a separate Banking EIN for the Paypal Account anyway. That way, the 1099-K will be issued in your Pack's EIN. The financials ultimately flow up to the CO, but you'll create less confusion at the IRS with this 1099-K that will be for less than the amount connected to the Pack. Ultimately you'll include the 1099K in the report you give the CO each year, but you won't cause a Red Flag at the IRS's automated systems, nor confuse the accountant doing the tax returns.

[Pack18Alex]

Odd how that council does it.

 

Our CO is a church we use the tax exempt number and their EIN for everything.

 

I suppose things are different when your a PTA/PTO charter,

PTOs are 501©3's that file a 990 Tax Return. Churches are 501©3's that file no tax return.

 

Ultimately, the BSA Units financials flow up to the CO. However, since Churches don't file Tax Returns (First Amendment, Congress can't regulate them), whatever the Pack does disappears beyond whatever financials the Church Treasurer generates.

 

Let me give you an example. Cub Scout Pack collects $750 in dues via Paypal. Over the course of the year, spends $725. When the PTO adds the Pack Financials to the P&L, it adds a line, "Income from Cub Scout Pack, $25." When it does it's balance sheet, it adds a line, "Cub Scout Bank Account, $25". All done (ask an Accountant for the exact terms, I'm an MBA and can read an Income Statement and Balance Sheet, I don't generate them.

 

With the new regulations, electronic payments are reported on a 1099K. so now, the PTO gets a 1099K from Paypal for $750, and an income of $25. The Accountant needs to report this as:

 

1099K: Income, $750

Cub Scout Pack Expenses, $725

 

(the balance sheet is unchanged).

 

However, that requires the Accountant to real the P&L from the Cub Scout Pack, which is a disaster, and somehow report your expenses for that $725, of what is likely to make no sense. So if you're chartered to a non-church, you can simplify everyone's life by operating under a separate EIN. Because now the 1099K is linked to the Cub Scout Pack, which won't trigger an automatic flag. The CO can staple the 1099K and the Pack P&L to the return as a Statement, and no problem.

 

The problem is that if the CO doesn't report the 1099K (since the Pack Treasurer didn't give it to them), it can trigger an automatic audit, which will make the PTO not happy. While attached to the Pack statement, and the Accountant doing the return (likely a 990-N) won't be confused.

[King Ding Dong]

Odd how that council does it.

 

Our CO is a church we use the tax exempt number and their EIN for everything.

 

I suppose things are different when your a PTA/PTO charter,

By Royal Decree I hereby appoint Sir Pack18Alex our new Pack Treasurer.

 

I am confident you will serve your King well.

[ScoutNut]

Our Pack would like to setup a PayPal account to start collecting dues' date=' and also to be able to accept credit cards at our popcorn Show and Sell. During the registration, it asks for a Federal Tax ID #. Can anyone tell me what Tax ID # they are looking for? Is there an overall Tax ID # for Scouts, or something at our Council level, or is it even something at our chartering organization (elementary school) level?[/quote']

Check with your council re: credit cards for popcorn. My council is loaning out CC scanners this year for booth sales.All of the costs, and liability, is held by the council. The unit simply scans the card, and they are done.

[Pack18Alex]

Odd how that council does it.

 

Our CO is a church we use the tax exempt number and their EIN for everything.

 

I suppose things are different when your a PTA/PTO charter,

KDD,

 

My Pack Committee has two MBAs, 1 CPA, 2 JDs, and two small business owners. It's a running joke in our district, that if you are having trouble with budgets/spreadsheets, ask our Pack for help. However, if you need someone to actually do something with Scouts, my parents are useless.

 

That said, if the parents went rules lawyer on me like you have, I'd be frustrated, but at least I'd know that the parents cared. As it stands, few of my parents care.

 

But I'm one of the MBAs on the Committee, so I actually have a pretty solid handle on this side of the operation. That said, the "working with youth" part is a little tricky for me, but I'm growing as a person (and parent) via Scouting.

 

However, your advice of "Ask Your Council" is 100% correct. There are 50 States in the Union, plus the Federal District, plus overseas territories, military basis, etc. They are ALL governed under different laws. I think that SOME councils are inter-state, most are intrastate, and will guide you in the proper procedure for complying with YOUR state's laws.

 

However, there is zero consequence to having a "banking EIN" even if not required by your state, and I think it will keep your Unit Screw-ups from really impacting the Charter Organization. I highly recommend it. I'll be the first to admit I don't know how to tie a knot (beyond the ones I learned to teach the Wolf Scouts @ Day Camp), but I handle the paperwork well. I come here because experienced Scouters have advice on the Scouting side of things. I have some experience on the business/organizational side, so I share that with the people here.

[kari_cardi]

Our Pack would like to setup a PayPal account to start collecting dues' date=' and also to be able to accept credit cards at our popcorn Show and Sell. During the registration, it asks for a Federal Tax ID #. Can anyone tell me what Tax ID # they are looking for? Is there an overall Tax ID # for Scouts, or something at our Council level, or is it even something at our chartering organization (elementary school) level?[/quote']

Check with your council re: credit cards for popcorn. My council is loaning out CC scanners this year for booth sales.All of the costs, and liability, is held by the council. The unit simply scans the card, and they are done.

Our council is lending out CC scanners but the account to use the scanner is held by the unit, so all of the cost and liability is still with the unit. If our council would share ANY of the cost or liability of the popcorn sale I'd be a more enthusiastic supporter.