accounting 101 patrick scholl 2011 alumni leadership connections june 11, 2011

Accounting 101

Patrick Scholl2011 Alumni Leadership Connections

June 11, 2011

Course Objective

Provide answers to the list of most frequently-asked financial questions

and Test to see if you are

Smarter than a 5th Grader

List of Questions

1. What is an EIN and how do I obtain one?

2. How does my organization become recognized as a non-profit?

3. What are the benefits of 501(c)(3)?

4. What are the requirements of 501(c)(3)?

5. Is my organization exempt from paying sales tax?

List of Questions

6. Can my organization conduct games of chance to raise money?

7. How do I obtain a certificate of insurance for an upcoming event?

8. What insurance coverage is provided?

1. What is an EIN and how do I obtain one?

Employee Identification NumberNine-digit number assigned to entities for tax filing

and reporting purposesNecessary to open an account at a bankObtained by filing Form SS-4 with IRSDownload form at www.irs.gov/businesses.

Click on Employer ID Numbers

2. How does my organization become recognized as a non-profit?

Must have exempt purposeApply for exemption under 501(c)(3) of the Internal

Revenue CodeChapter and AIGs can sent written request to be

included under the group exemption of the Penn State Alumni Association.

Send written request includingEIN

Name and Address of Principal Officerto:

Patrick SchollDirector of Business and Finance

Penn State Alumni AssociationHintz Family Alumni CenterUniversity Park, PA 16802

pscholl@psu.edu814-863-2809

3. What are the benefits of 501(c)(3)?

Most revenue not subject to Federal Income TaxRevenue not subject to State Income TaxAble to offer tax deduction to donorsMay be eligible for special postage rates

4. What are the requirements of 501(c)(3)?

Must engage primarily in activities that accomplish exempt purpose

No earnings may inure to a private individualCertain revenue is taxable – first $1,000 is exemptFiscal year must end on June 30Requirements for donationsFiling requirements for tax forms

4a. Requirement for Charitable Contributions

Written disclosure required for donation of $250 or more Name Date If cash - Amount of contribution. If non-cash -

description of contribution. Description and estimated value of any goods or

services organization provided to donor must be included.

4b. Filing requirements for 501(c)(3)?

If Total Revenue is $50,000 or less – File Form 990-N

If Total Revenue is greater than $50,000 but less than $200,000; and Total Assets are less than $500,000 – File Form 990-EZ

Otherwise – File Form 990Due by November 15 following close of fiscal year

5. Is my organization exempt from paying sales tax?

Organizations based in Pennsylvania are NOT exempt from paying Pennsylvania sales tax

Some states do provide exemptions – check with your state’s department of revenue

6. Can my organization conduct games of chance to raise money?

Each state’s requirement differ – check with your own state’s department of revenue

Pennsylvania permits charitable organizations to conduct certain Small Games of Chance of games such as Daily Drawings; Weekly Drawings; and Raffles

6. Can my organization conduct games of chance to raise money?

(continued)

In Pennsylvania - Contact your County Treasurer for a license to conduct small games of chance

Persons under 18 years of age are not permitted to operate or play any games of chance

Individuals may not receive compensation for conducting any games of chance

Other restrictions – amount of prizes and total prizes awarded in a year

7. How do I obtain a certificate of insurance for an upcoming event?

Send request to your Regional Director or

Cris Boob

Office of Risk Management

cnb1@psu.edu

814-865-4029

8. What insurance coverage is provided?

$1 Million General Liability$1 Million Auto$1 Million excess for each occurrence$5 Million aggregateNot Directors and Officers

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Are You Smarter than a 5th Grader?

International Currency Symbols

¥

Are You Smarter than a 5th Grader?

What Currency symbol is

$¥

Are You Smarter than a 5th Grader?

What Currency symbol is

$

American Dollar

¥

Are You Smarter than a 5th Grader?

What Currency symbol is

€

Are You Smarter than a 5th Grader?

What Currency symbol is

€

Euro

Are You Smarter than a 5th Grader?

What Currency symbol is

¥

Are You Smarter than a 5th Grader?

What Currency symbol is

¥

Japan - Yen

Are You Smarter than a 5th Grader?

What Currency symbol is

CHF

Are You Smarter than a 5th Grader?

What Currency symbol is

CHF

Switzerland - Franc

Questions?

Patrick SchollDirector of Business and Finance

Penn State Alumni AssociationHintz Family Alumni Center

University Park, PA 16802

pscholl@psu.edu

814-863-2809