Individual Scout Accounts Part Trois

[Stosh]

Right now, as I look out the window, Scouts should be making enough money shoveling out driveways to last them the entire year of Scouting

What a scout does on his own time, putting money in his own personal account is none of BSA's business and the rules don't apply. This is a transaction between the boy shoveling and the homeowner.

 

Stosh

[boomerscout]

With the individual incentive removed, will units set stricter rules for member fundraiser participation, make do with a projected decrease in funds raised, use pay as you go, allow families to "opt-out" of fundraising?

 

There can be so-called private benefits if the fundraiser is used to further the stated goals of the organization such as camping fees, dues, uniforms, handbook, workshop fees

[fred johnson]

With the individual incentive removed, will units set stricter rules for member fundraiser participation, make do with a projected decrease in funds raised, use pay as you go, allow families to "opt-out" of fundraising?

 

boomerscouter ... as long as the reduced fees, dues, etc are not tied to raising money and the raised funds can't be targetted to those who ran the fundraiser or the ran the organization. The funds of a non-profit are to be used for the purpose of the non-profit for the public good. Individuals raising money targetted to reducing their own costs is not being used for the public purpose of the non-profit.

 

Requiring participation in a fundraiser is viewed as equivalent as dues because the public can't benefit from the non-profit without raising funds.

 

I'm not an IRS or legal expert, but the trouble is not that this is hard to interpret. The problem is people want to continue as is and ignore the new IRS emphasis.

[Pack18Alex]

When I did the Pack budget, I put subsidies in the events out of the Pack Budget. Our fundraising goes towards capital needs, and $150-$200 per event, so essentially we undercharge for food/registration and eat it from the Pack Budget. The Pack Budget comes 50%-50% from dues and fundraising (up from 100% dues two years ago).

 

One of the leaders asked me about this, didn't understand why we were subsidizing the campouts from the fundraising. I told him that the people working the fundraisers, serving as leaders, and attending the campouts is largely the same people. The boys that go camping are gung-ho for the program. The boys that show up for a weekly meeting are having fun, but it's not a core focus of their week.

 

When I keep the costs down, we have better attendance. More attendance means more Scouts retain. Are there families that camp and don't fundraise... I guess, one or two. Are there families that fundraise and don't camp? Yeah, one or two. But in general, it's the same group.

 

We have some families that can't pay dues, we ask that they participate in fundraisers and we'll take care of them via campership. We don't use Scout Accounts, we tried, it was a tracking nightmare and didn't seem to serve much purpose.

 

But I have a weird demographic. 80% of my kids are upper-middle class, a good chunk are in private religious schooling. Our food costs have to be managed VERY carefully (kosher food gets expensive REAL fast if you don't economize). It's easier to carry the families that can't pay than to do complicated Scout Accounts.

 

Also, the boys seem gung ho for prizes. They aren't gung ho to save their parents $50 on dues or summer camp.

Again, I have a weird dynamic. Most of my youth will go to local "Jewish" summer camp programs. Those camps run from $160-$240/week.

 

Cub Scout Day camp costs $115/week if registered early.

 

So it's the few broke parents that would benefit. I just don't have the energy for a third fundraiser. It a good idea from the "a Scout is Thrifty" point of view, it's a non-started from the Pack18Alex spends plenty of time on Scouting and doesn't want to spend more.

 

But I'll consider it, it's worth looking into. The boys in need of Campership are also the ones traveling 30-45 minutes to be with our Pack, so the fundraiser isn't terribly convenient.

[boomerscout]

With the individual incentive removed, will units set stricter rules for member fundraiser participation, make do with a projected decrease in funds raised, use pay as you go, allow families to "opt-out" of fundraising?

 

yeah, Fred, and one of the purposes of non-profit Scouting is to go camping -- with all that that implies. You can fundraise for camping fees, troop equipment, etc. I have this letter from the IRS:

One of the purposes of the Scouting program is to instill

self-reliance ixxxxxxxxxx. You indicate that one way of doing this is to allow the xxxxxx

to earn their own way as opposed to depending on others, including their parents, to

fund their individual scouting participation.

 

To further this self-reliance, you are proposing to allow the xxxxxx in your Pack to raise

monies through fundraising activities and to designate the use of some of these funds to

pay for personal expenses. These expenses would include 1) Scouting fees such as

organization dues and camp registration fees; 2) items used exclusively for Scouting

such as uniforms and Scouting books; and 3) items used primarily for Scouting such as

camping equipment.

 

Using the money raised in various fundraising activities to further the Scouting program

for all of the xxxxxx in your Pack is in accordance with your exempt purposes

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx. In this regard, the Pack could use the funds (all or a

percentage) it raises to reduce or eliminate dues and various registration fees, purchase

uniforms and Scouting books and purchase camping equipment. The Pack could also

use its funds to provide assistance to individual Scouts in cases of financial hardship.

 

The distribution method you are proposing - the creation of a reserve fund within the

Pack where a portion of the money that an individual Scout raises during a fundraising 2

 

 

event is reserved for xxx use alone, is a troublesome one. Earmarked accounts may

not be compatible with continued tax exemption. "

So, no ISAs, no individual reserve accounts; you can earn camp fees & Scout stuff, but any extra money you bring in goes to the troop as a whole

[boomerscout]

Right now, as I look out the window, Scouts should be making enough money shoveling out driveways to last them the entire year of Scouting

Yeah, jblake, this is one reason we promote Rent-a-Scout over most of the typical fundraisers. The troop doesn't get involved except for the cachet of "yes, he is a Scout, and is trying to earn money to have his own Jet-Ski at summer camp (Ha-ha). Legally, each Scout is a self-employed businessperson. Each chips in about 10% of earnings to a disabled, homestay parent who is willing to act as dispatcher

The troop's main involvement is to urge, strongly urge, merit badges in first-aid, personal management (hooray!), and all the home repair ones. We also urge taking the baby-sitting course at the Y when offered. Most work in pairs until the client is determined safe. Each rarely earns more than the individual tax exemption

[Pack18Alex]

What I find frustrating is that IRS issues vague letters, with words like substantially in there. It would be nice if the BSA would draft a CAREFUL letter to the IRS governing what is substantial. Often the IRS picks thresholds like 50%.

 

It's possible that a request that would permit 40% of the money in the Scout Account, to be used towards that individual's participation in Scouting, and 60% in the Scout Unit general fund for the mission, would fly.

 

Substantially, the money goes to the unit. The 40% isn't an excess benefit, because it's limited to Scouting.

 

Somewhere in 8 figures of salary, someone can think to call a tax lawyer, instead of depending on volunteers at their local Church/Synagogue to do the heavy lifting.

[koolaidman]

What I find frustrating is that IRS issues vague letters, with words like substantially in there. It would be nice if the BSA would draft a CAREFUL letter to the IRS governing what is substantial. Often the IRS picks thresholds like 50%.

 

It's possible that a request that would permit 40% of the money in the Scout Account, to be used towards that individual's participation in Scouting, and 60% in the Scout Unit general fund for the mission, would fly.

 

Substantially, the money goes to the unit. The 40% isn't an excess benefit, because it's limited to Scouting.

 

Somewhere in 8 figures of salary, someone can think to call a tax lawyer, instead of depending on volunteers at their local Church/Synagogue to do the heavy lifting.

I think folks are scared of the answer they may get.

[Stosh]

What I find frustrating is that IRS issues vague letters, with words like substantially in there. It would be nice if the BSA would draft a CAREFUL letter to the IRS governing what is substantial. Often the IRS picks thresholds like 50%.

 

It's possible that a request that would permit 40% of the money in the Scout Account, to be used towards that individual's participation in Scouting, and 60% in the Scout Unit general fund for the mission, would fly.

 

Substantially, the money goes to the unit. The 40% isn't an excess benefit, because it's limited to Scouting.

 

Somewhere in 8 figures of salary, someone can think to call a tax lawyer, instead of depending on volunteers at their local Church/Synagogue to do the heavy lifting.

If 5 people were to call the IRS for a ruling, they would get 5 different answers. The way things are going right now, they probably won't get any answer in that they aren't answering the phones.

 

Stosh

[skeptic]

Why can't we simply continue with our program as it works and quit "looking" for problems. It unlikely this is really an issue with most units. It gets tiresome to see the continual bantering about what "might" be done wrong, or "might" go wrong, or "what" someone else is doing that someone thinks is wrong. Just run your program honestly and the best you can. If something unusual comes up, worry about it "then"!

[Stosh]

Why can't we simply continue with our program as it works and quit "looking" for problems. It unlikely this is really an issue with most units. It gets tiresome to see the continual bantering about what "might" be done wrong, or "might" go wrong, or "what" someone else is doing that someone thinks is wrong. Just run your program honestly and the best you can. If something unusual comes up, worry about it "then"!

Be Prepared...

 

Stosh

[Pack18Alex]

What I find frustrating is that IRS issues vague letters, with words like substantially in there. It would be nice if the BSA would draft a CAREFUL letter to the IRS governing what is substantial. Often the IRS picks thresholds like 50%.

 

It's possible that a request that would permit 40% of the money in the Scout Account, to be used towards that individual's participation in Scouting, and 60% in the Scout Unit general fund for the mission, would fly.

 

Substantially, the money goes to the unit. The 40% isn't an excess benefit, because it's limited to Scouting.

 

Somewhere in 8 figures of salary, someone can think to call a tax lawyer, instead of depending on volunteers at their local Church/Synagogue to do the heavy lifting.

An IRS phone rep just gives you an answer, not always a right answer, and they take no responsibility for it.

 

An IRS letter ruling is a different beast, and has some degree of validity.

 

You don't want 5 people calling the IRS, you want a Tax Lawyer drafting a careful and specific letter that gets them the answer they want, that people can rely on.

[fred johnson]

Why can't we simply continue with our program as it works and quit "looking" for problems. It unlikely this is really an issue with most units. It gets tiresome to see the continual bantering about what "might" be done wrong, or "might" go wrong, or "what" someone else is doing that someone thinks is wrong. Just run your program honestly and the best you can. If something unusual comes up, worry about it "then"!

... do my duty to God and my country

[fred johnson]

What I find frustrating is that IRS issues vague letters, with words like substantially in there. It would be nice if the BSA would draft a CAREFUL letter to the IRS governing what is substantial. Often the IRS picks thresholds like 50%.

 

It's possible that a request that would permit 40% of the money in the Scout Account, to be used towards that individual's participation in Scouting, and 60% in the Scout Unit general fund for the mission, would fly.

 

Substantially, the money goes to the unit. The 40% isn't an excess benefit, because it's limited to Scouting.

 

Somewhere in 8 figures of salary, someone can think to call a tax lawyer, instead of depending on volunteers at their local Church/Synagogue to do the heavy lifting.

"somewhere in 8 figures of salary, someone can think to call a tax lawyer ..." ... I think BSA did that and thus the no scout account statements.

[fred johnson]

Right now, as I look out the window, Scouts should be making enough money shoveling out driveways to last them the entire year of Scouting

Rent-a-scout ... Interesting idea. I like it. I'd want to keep the troop out of handling the money, but otherwise a very good idea.

 

My only fear is the scout who does plenty of work, but keeps the cash for other things.

 

Still like the idea though.