When developing a PTA budget, consider including the following line items:
Carry-over Funds: Carry-over funds represent the amount which is set aside to begin operations at the beginning of the next PTA fiscal year, prior to the onset of fundraising activities. To calculate the amount of this reserve, review the prior year’s Annual Financial Report to determine which operation or program expenses require funding during transition, and estimate costs for these items in the new fiscal year.
Convention: The annual California State PTA convention is usually held at the end of April or the first part of May. The unit should budget enough money to cover the cost of registration, hotel room, transportation and food for the allowed number of delegates based on the unit’s membership (Attending Conventions and Conferences).
Donations: PTAs may ask community supporters to donate funds to the PTA for general use or for a specific program.
Fundraisers: Fundraising income is the gross income from fundraisers. List each fundraiser individually. The expenses for conducting each fundraiser should be listed under Expenses individually by fundraiser.
Gross Income: This includes the total amount of income for the year, excluding council, district, State, and National PTA portions of per capita dues and freewill offerings.
Insurance: Participation in the California State PTA insurance program is required of all PTAs in California. Budget an amount that is similar to the actual expense from the previous year’s premium plus 10%. Units are notified of the premium amounts by October 1. The premium must be submitted to AIM by December 20, or a late fee of $25 will be assessed by California State PTA.
Membership Dues: Each association determines its own membership dues, but a portion of each membership must be forwarded through channels. The forwarded funds are listed as “Funds Not Belonging to the Unit.” This line of the budget should only reflect the amount of dues the unit retains as income.
Membership Envelopes: The purchase or printing of membership envelopes is listed as an expense.
Reimbursable Expenses: PTA should reimburse executive board members for any approved out-of-pocket expenses. PTA funds may not be used for personal expenses, gifts, personal acknowledgments, or personal use items. Appropriate out-of pocket expenses include photocopies, office supplies, etc. Unit, council and district PTAs should budget for out-of-pocket expenses and ensure the budget is shared equitably among officers/chairmen in accordance with job responsibilities. Members should be reimbursed upon submission of a signed Payment Authorization/Request for Reimbursement form. Receipts must be submitted for all reimbursable expenses. Unit, council and district PTAs may not budget an officer’s allowance. The IRS considers an allowance as miscellaneous income that must be declared by the recipient as such and will be taxed accordingly.
Staff/Volunteer Appreciation: PTA resources may be used for hospitality for staff/volunteer appreciation as long as it does not represent a significant amount. “Not of a significant amount” was previously defined by the IRS as an amount that does not exceed 5 percent of the nonprofit organization’s annual budget (see Staff Appreciation). PTA funds cannot be used to purchase personal gifts for staff or volunteers, including gift cards.
Training/Workshops: Budget funds to send executive board members to council, PTA district, and California State PTA workshops/meetings.
Unallocated Reserve: Unallocated reserve funds represent the amount remaining after making allocations for budgeted programs and activities and may be used to cover any unexpected or unplanned expenses in the current fiscal year with approval of the association. The budget should be amended to reflect funds transferred from Unallocated Reserves to other expense categories.
Restricted Reserve: In planning the budget, it is permissible for PTAs to have a savings account to hold funds for more than one year for the following reasons:
- Efficient management of restricted funds;
- A PTA program requires large donation to the school and the school district requires advance notice if the PTA cannot continue to fund the activity; i.e., computer equipment or teacher aide salary; and
- Monies to finance long-term or unexpected but approved projects or programs, i.e., playground project.
As a guide, the savings account reserve should not exceed one-half of the association’s budget for an average year.
