• is the authorized custodian of the PTA's funds.
• receives and disburses all monies as prescribed in the local bylaws or as authorized by action of the PTA's board of directors.
• keeps a full account of receipts and expenditures.

Treasurer FAQs

Question: Can a PTA sponsor a donation drive and for every so many dollars donated put donors’ names into a drawing for a prize as an incentive to donate?
Answer: Yes, but this is legally considered a raffle and not a donation drive, and therefore all laws and rules regarding the raffle should be followed (see Texas PTA Treasurer’s Guide page 25).

Question: For raffles, is there a limit on the value of prizes?
Answer: Yes. For purchased prizes, the value of each prize may not exceed $50,000. For a purchased residential dwelling, the value may not exceed $250,000. There is no limit to the value of donated prizes. Cash prizes (coins, paper currency, or a negotiable instrument that represents and is readily convertible to coins or paper currency) are strictly prohibited. A certificate of deposit is a prohibited prize. A U.S. savings bond and a prepaid, or “stored-value” credit card is not prohibited. See Texas Attorney General Opinion No. GA-0341 (2005). The question of the prohibition of a gift certificate has not been directly addressed in an AG Opinion, but as long as it is not readily convertible to cash, it would likely not be prohibited.

Question:  When do I have to collect sales tax?
Answer:  The first criterion is to determine if the PTA is the seller or the vendor is the seller and the PTA is acting as their agent. For PTA to be the seller they must first purchase the merchandise and then determine the selling price. In instances where PTA is the seller, the general rule is: sales tax is collected on any tangible item sold other than at the two tax-free days. This would include, but is not limited to, T-shirts, school supplies, Holiday gift shop gift items and books at Book Fairs.  It does not include food items, admission fees (when all of the proceeds go to PTA), or any writings or publications such as cookbooks or student directories of the PTA.  (“Of the PTA” means the PTA must have been responsible for the publication of the works even if they had a commercial printer print and bind the publication.)

Question:  When is an audit required?
Answer:  An audit is required at the end of each fiscal year or any time authorized check signers change. Additionally, an audit can be conducted at any time the association feels one is needed.

Question:  When does the new treasurer take over the books?
Answer:  According to “Texas PTA Local PTA/PTSA Bylaws Template,” Article VIII: Officers and Their Election, *Section 2(d) states:  “Officers shall assume their official duties following the close of the school year and shall serve a term of one year.” Procedure books and materials must be given to newly elected officers no later than 15 days after they assume their duties. However, it is recommended that an outgoing treasurer complete the books upon the close of the fiscal year, secure the signature of the president, file the appropriate Form 990, and then turn the books over to the Audit Committee for review. Treasurers should receive books directly from the Audit Committee upon completion of the audit.  Upon turning the books over to the audit committee, incoming and outgoing officers should go to the bank and change the signature card. Once the books are in the Audit Committee’s possession, the outgoing officers should no longer sign checks or conduct any transactions.

Question:  Can I pay sales tax when we purchase our merchandise for sale so I don’t have to collect it when we sell it?
Answer:  No, sales tax must be collected from the end user (customer) on the retail price, not the wholesale price. 

Question:  Are cookbooks, directories or yearbooks taxable?
Answer:  No, not if produced by the PTA. It is considered “produced” by PTA if members decide the content, even if printed by a commercial printer,

Question:  When do I have to file a Form 990-EZ?
Answer:  If your gross receipts average more than $25,000 per year based upon a three-year average, you are required to file a Form 990-EZ within four and one-half months after the end of your fiscal year.

Question:  Can we have a fundraiser to raise money for a student who needs an operation?
Answer:  No. Funds cannot be raised through the PTA for an individual, no matter how worthy the cause.  The student’s family may be encouraged to apply to the Texas PTA Emergency Needs Relief Fund. PTA’s are encouraged to donate to this fund, but contributions may not be earmarked for a specific individual.

Question:  Do I have to pay sales tax on prizes purchased as giveaways at a carnival?
Answer:  No, items purchased for PTA use are exempt from sales tax. As these items are not sold, neither would sales tax be collected.

Question:  Can our gift-wrap fundraiser be a tax-free day since we sell over a period of one month?
Answer:  Yes, provided certain criteria are met. First, the PTA must purchase inventory AND determine the selling price. Then, if all merchandise purchased is based upon advance order sales and all merchandise is ordered at the same time and allmerchandise is delivered to the PTA on one day by the supplier the Texas Comptroller’s office has stated that you may consider this a one-day event even if delivered over a reasonable period of time.

Question:  If we make no profit on our school supplies, do we have to collect and pay sales tax?
Answer:  Yes, profit is not a factor in determining what items you must collect sales tax on.

Question:  How much money can we carry over to next year?
Answer:  There is no established minimum or maximum amount. It will vary from PTA to PTA based upon when each holds its fundraisers. If you have no fundraiser until spring, you will need to carry over more than if you’re major fundraisers is in the early fall. However, a PTA should not raise more funds than is necessary to carry out its tax-exempt function.

Question:  A local business wants to make a contribution to our PTA but needs proof of our tax-exempt status. What do I give them?
Answer:  Give them a copy of our IRS determination letter. Refer to the Treasurer’s Guide or the “Resources/Forms” section of the Texas PTA Handbook for a copy of the letter.

Question:  Can our PTA purchase gift cards?
Answer:  According to IRS non-profit organizations cannot purchase gift cards. The risk here is individual or member benefit, which is cause for the IRS to remove the non-profit status. Your members including teachers) or individuals should not benefit personally.  The other problem is that when using gift cards, it is truly the same as giving cash.  There is no itemized receipt for what was actually purchased with PTA funds. It is recommended to find other ways to show appreciation, For example, for teacher appreciation the PTA could provide providing volunteers to cover classrooms so that the teachers can “go out” to lunch and then ask a restaurant close by to give these teachers a 20 percent discount in support of the teachers.

Question:  Can our PTA give door prizes?
Answer:  Yes, as long as the item is nominal in value and money is not collected in order to be eligible.

Question:  Can our PTA be a paying member of our local Chamber of Commerce?
Answer:  Yes, as long as the PTA membership has approved the membership and its associated expenditure. This expenditure should be included in the budget.

Question: Can PTAs operate using electronic banking?
Answer: No. On Page 2 of the Texas PTA Treasurer’s Guide, it states that PTAs will not have debit/credit cards, nor bank electronically. Because of the risks involved, all disbursements should be paid by check with 2 signers, per the Local/Council PTA’s bylaws. Most vendors gladly accept checks, so while electronic banking may be more convenient, it is not necessary and places the funds of the PTA at a much greater risk.

Question: Are PTAs permitted to hold a raffle where multiple prizes are awarded by drawing from multiple containers, or does this constitute more than one raffle?
Answer: Per a written response from a representative with the Office of the Attorney General, as long as the prizes are awarded at one event/occasion, multiple containers to draw from can be used to constitute only one event/one raffle.