Fundraising for

School Clubs and Organizations

Anna ISD Learns

Purpose of Fundraising

• Anna ISD allows fundraising activities to benefit the educational process.
• Activities may be whole campuses raising money to supplement their operating budgets or individual student groups raising money to fund their activities, such as prom, cheer camp, travel, etc.
• Fundraising must have a specific purpose and support an approved district program.
• Funds must be spent in a timely manner and should not result in large account balances that are rolling unspent from year to year.

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Texas Education Agency

Financial Accountability System Resource Guide, Update 18 Appendices Appendix H

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Types of Activity Funds

• Campus Activity Funds
• Generated by the student body or a campus as a whole
• Promote the general welfare of the school and the educational development and morale of students.
• Considered “public” funds, fund expenditures are subject to all the same procedures as operating funds. These funds are accounted for in Fund 461.

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• Student Activity Funds
• Monies accumulated by student clubs, under the supervision of a school sponsor.
• Expended in accordance with the wishes of the student group generating the funds. The members and sponsors of the student club must approve these expenditures. These funds are accounted for in Fund 865.

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Texas Comptroller’s Office

School Fundraisers

Sales Tax Information

• Sales and Use Tax Exemption Certificate
• Exempts a qualified organization from PAYING sales tax on purchases
• Sales and Use Tax Resale Certificate
• Allows an organization to PURCHASE taxable items tax-free for resale purposes.
• Sales Tax Permit
• Allows an organization to SELL taxable items in Texas and collect sales tax.
• Sales and Use Tax Return
• Used to report sales tax to the state.

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Types of Fundraisers

• Taxable Sales
• Items for resale can be purchased tax-free using a Texas Sales and Use Tax Resale certificate.
• Determine how sales tax will be calculated:
• Calculated on price (price X 8.25%)
• Included in price (price less price X .9238)
• Once completed, file a Sales and Use Tax Return with Texas Comptroller to remit sales tax
• Due either monthly, quarterly, semi-annually, or annually by the 20th day of month following the end of the reporting period.
• $50 Penalty plus interest on the sales tax due for late filing.
• Texas' criminal penalties for failure to pay sales tax collections range from a Class C misdemeanor to a 2nd Degree Felony.

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Types of Fundraisers

• One-Day Tax-Free Sales
• Allows an exempt organization to sell taxable items free of sales tax.
• Orders and money collection can take place up to two weeks prior to distribution
• “Sale” takes place when the purchaser takes possession of the ordered item. All items sold must be distributed to the purchasers within the same 24-hour day.
• Surplus items sold after the 24-hour period are taxable.
• Who Qualifies and How Often?
• District - 2 per calendar year (Spring and Fall)
• Each Campus - 2 per calendar year (Spring and Fall)
• Student Organizations (Fund 865) - 2 per calendar year (Spring and Fall)

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Types of Fundraisers

• Catalogue or Commissioned Sales
• Enter into an agreement with a fundraising company to sell items though would be taxed.
• Fundraising company should provide instructions on how to collect sales tax correctly.
• Catalogue Sale - market the items, collect the money and send the fundraising company their share of the profits and the sales tax collected.
• Commissioned Sale - items are purchased directly from the fundraising company who sends us our share of the profits. Online stores are examples of this type of sale.
• Fundraising company will collect, report and remit the sales tax to the state.
• Does not count as a one of the two one-day tax-free sales

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Types of Fundraisers

• Non-Taxable Sale Examples:
• Magazine subscriptions for at least six months
• Gift Certificates and Discount Cards
• Admission to a school carnival, dance, athletic event, or performance
• Meals and food products, including candy and soft drinks, sold in an elementary or secondary school during the regular school day.
• Food, prepared food, soft drinks, snack items, or candy sold by booster clubs or other school support organizations at a concession stand during a school’s or school district's sponsored or sanctioned event

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Types of Fundraisers

• Non-Sale Fundraisers Examples:
• School Nights at Local Restaurants
• Pledge-a-Thon
• Calendar Fundraiser
• Donations of Money

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Types of Fundraisers

• Raffles
• The Texas Attorney General’s Opinion JM-1176 ruled that independent school districts are not qualified charitable organizations based on the terms of the Charitable Raffle Enabling Act and are not authorized to conduct raffles.
• An unauthorized raffle is considered gambling under the Texas Penal Code - Class A Misdemeanor. Participating in an unauthorized raffle is a Class C misdemeanor.

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Fundraiser Decision Tree

Fundraiser Approval

• All fundraisers must be approved in advance by the campus principal using the Request for Fundraiser form available on the Business Services Support Page.
• Do not advertise the fundraiser or contract with a fundraising company prior to obtaining approval.
• Fundraising companies must be an approved vendor.
• Tracked on the Activity Fund Fundraiser Spreadsheet
• Form becomes backup for any payments made for the fundraiser.

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Profit or Loss Statement

• The success of a fundraiser can be determined using the Fundraiser Profit Loss Statement form available on the Business Services Support Page.
• Actual Sales (less any applicable Sales Tax) - Actual Expenses = Net Profit or Loss
• Examples of Expenses:
• Cost of items purchased for resale
• Cost of materials and supplies used to create sale items
• Vendor portion of sales
• Losses must be covered by the approving campus.

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Questions?