Standards of Affiliation & Finance Basics

All PTAs in Virginia are organized and chartered by Virginia PTA and covered under the umbrella of the Virginia PTA's 501(c)(3) non-profit status granted by the Internal Revenue Service. This group exemption exempts your local unit from paying federal income tax on money earned, allows donations to be claimed as tax exempt and enables your local PTA unit to apply for a Virginia Sales Tax Exemption. ALL BOARD MEMBERS, not just the Treasurer, have fiduciary responsibility for the financial position of the PTA. 

STANDARDS OF AFFILIATION (Good Standing)

Standards of Affiliation are defined in Virginia PTA's Local Unit Uniform bylaws and ensure local and council PTAs maintain 501(c)3 best practices and comply with applicable federal and state laws. Standards of Affiliation are sometimes referred to as Good Standing which generically refers to a selection of Standards of Affiliation that must be met to qualify your PTA to participate in PTA grant and awards programs.

We recommend you keep a copy of the pdf Standards of Affiliation checklist (134 KB)  and copies of all pertinent documentation in your legal documents or treasurer binder. 

Standards of Affiliation includes

  1. Contact Information for your Executive Board (June 15th)
  2. Annual Financial Review (Aug 1st)
  3. Annual Tax filing for the fiscal year ending June 30th (Aug 1st) 
  4. Membership List; (1st of each month)
  5. Membership Dues; (1st of each month) 
  6. Proof of Insurance; (Oct 1, 2022 and thereafter June 15th)
  7. Bylaws Organizational Structure Form (re-submitted if modified)

FISCAL YEAR

PTA's in Virginia have a fiscal year of July 1st - June 30th. 

ANNUAL FINANCIAL REVIEW/AUDIT 

The purpose of the annual Financial Review or Audit is to ensure that PTAs are following proper financial procedures, practicing financial responsibility and providing transparency for their General Membership. If they have been challenges over the past year, the Financial Review will help your PTA identify gaps and opportunities to improve financial practices and get back on track with best practices.

Timeline & Submission

Your financial review should be complete and submitted to Virginia PTA via MemberHub by August 1st. This allows the incoming Treasurer to fully transition into their new role at the start of August and allows the incoming Executive Board to use the valuable summer months to budget and prepare for the coming year. Completed Financial Reviews should be presented to your General Membership at your September PTA meeting for approval. If there are edits as a result of General Membership Review, then please re-submit your audit to Virginia PTA via MemberHub. Please remember that if your Treasurer leaves office for any reason in the middle of the year, a Financial Review should be completed before the new Treasurer takes office. 

Conducting your Financial Review
  1. Your Executive Board appoints a Financial Review Committee of three PTA members who were NOT authorized signers on your unit's bank account.
  2. Your outgoing Treasuer prepares their books and records for review and completes the first half of the Financial Review (Audit) report.
  3. The Financial Review Committee conducts a materials provided by the Treasuer and completes their section of the Financial Review (Audit) Report.
  4. Exective Board accepts the Financial Review
  5. General Membership votes to adopts the Financial Review 
  6. The president and treasurer that are in office at the time sign page 1 and scan your entire financial review (including all pages of the financial review report and any additional information from the financial review committee or auditor)
  7. Submit your financial review by uploading a copy to MemberHub. (Click 'Compliance' in the left menu and then the 'Submissions' box)

​ANNUAL TAX FILING

All local PTA units that have gross receipts of less than $50,000 must file an IRS Form 990N (e-postcard). If the PTA's gross receipts are $50,001 or more, but less than $250,000, the unit may file a Form 990EZ. If a PTA's gross receipts are over $250,000 they must file a full Form 990.  If you fail to file taxes for 3 years in a row you risk losing your federal tax-exempt status. 

You should have your tax filing complete and submitted to Virginia PTA via MemberHub by August 1st to facilitate transition to a new Treasurer.

INSURANCE

PTA activities can create liability and put you at risk for loss due to theft, injury, property damage and many other issues. To protect yourself and your PTA, and in accordance with your bylaws, your PTA must purchase annual insurance. Many PTAs use RV Nuccio or AIM Insurance. You should ensure your incoming board is covered to start operations. Please submit proof of insurance to Virginia PTA by Oct 1st in 2022 and by June 15th thereafter.
  • All PTAs must provide proof of insurance coverage by uploading your insurance certificate to MemberHub. (Click 'Compliance' in the left menu and then the 'Submissions' box)
  • If your insurance renews in the fall/winter; please upload your current insurance certificate after July 1 to show coverage at the start of the new fiscal year Later, when your insurance is renewed, you should upload the new insurance coverage certificate.

501(c)3 DETERMINATION LETTER

Virginia PTA generally distributes your annual 501(c)(3) Verification letter in November, when all Good Standing Requirements have been met. You can give a copy of this 501(c)(3) letter to any sponsors, businesses or individuals making donations to your local unit so that they can claim their donation as tax exempt. Abiding by federal guidelines is extremely important to maintain tax-exempt status and ensuring your PTA is financially sound. You can use this form to request a copy of the 501c(3) letter if you do not have your on file. 

PREPARING A BUDGET 

Preparing your annual budget is an excellent opportunity for your board to talk through goals for the coming year. Remember, our mission is to advocate for the heath and welfare of children and to create a supportive inclusive school climate. You should only raise enough money to cover your needs for the year. Please be mindful of whether or not the items that you discuss raising money are items that should be paid for by the school division or create inequitibale learning across your county or region. If so, you may like to consider advocating for improved resourcecs for your entire community.

Your Executive Board should approve the proposed budget to be presented to the general membership for adoption. Per uniform bylaws, you should obtain general membership approval for any changes to the adopted budget over five hundred dollars ($500.00) per fiscal year.

Visit Treasuer Tools for sample budgets, treasurer request forms, monthly reports and a sample organization structure for your Treasurer binder.

SAMPLE SUMMER PLANNING CALENDAR

Last Membership Meeting of the School Year Adopt a summer spending budget to support operations until the Fall Membership meeting where the full fiscal year budget is adopted
 Last Day of School Target deadline to submit all Treasurer Reimbursement Requests
 June 30th Fiscal year ends and so does spending under the 202X-202Y budget. 
 July 1st - 9th Treasurer reconciles checking account to June 30.  Fills out their portion of the financial review report and prepares all materials for the Financial Review Committee.
 July 10th - 20th Financial Review Committee conducts their review and provides a full completed report to Executive Board
 July 20th - 30th

File 202X taxes for 202X-202Y fiscal year and submit verification form to Virginia PTA via MemberHub by Aug. 1st.
Visit the bank to update authorized signers. (Three signers is best practice. Typically the President, Treasurer and Secretary are authorized signers). 
August 1st
  • 990 Verification due to Virginia PTA via MemberHub
  • Fiscal Year Financial Review due to Virginia PTA via MemberHub
  • Treasurer transition complete! 
  • New Treasurer starts work on the 20X2-20X23 Budget in collaboration with a Budget Committee or the Executive Board. The new fiscal year budget should include any income/expenses approved by General Membership in your Summer Spending Budget.
Month of August
  • Finalize your 202Y-202Z Calendar.
  • Prepare for Back to School events.  
  • Verify your MemberHub account it linked to your Bank account to facilitate Membership sales (and on-line store sales) and 1-click dues payments to Virginia PTA
  • Conduct a practice run for processing payments and collecting membership dues!
First General Membership Mtg of 202Y-202Z  General Membership votes to adopt the 202X-202Y financial review report and a 202Y-202Z budget.