Discussion:Gross when acting as agent/Non-Profit Corporation
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Discussion Forum Index --> Advanced Tax Questions --> Gross when acting as agent/Non-Profit Corporation
Discussion Forum Index --> Tax Questions --> Gross when acting as agent/Non-Profit Corporation
| 22 August 2008 | |
| I'm the treasurer for a non-profit corporation. The organization was formed as a motorsport sanctioning body to set up uniform rules for the sport and promote the sport.
The only revenues are membership dues and sanctioning fees from towns that want to put on an event. The dues go to cover operating expenses, the sanctioning fees go to pay for liability insurance for the organization and the event. The organization never filed for exemption as their gross receipts were under $5,000 per year, and they've never filed a 990 because their recepts are under $25,000 per year. The towns are wanting us to start collecting the entry fees at the events and paying out the prize money. Currently, the towns putting on the events collect the entry fees and pay out the prize money themselves. Basically this change would shift the paperwork from them to us. They would simply give us one check covering all fees and prize money, and we would pay it out. This is how the big sanctioning groups do it. If we did this, the organizations gross receipts would go over the $5,000/$25000 limits, and we would have to apply for exemption and start filing 990's. However, I saw in the Form 990 instructions under "Gross receipts when acting as agent" that gross receipts collected by a 501(c)(8)fraternal organization that are remitted to the parent lodge are not included in the organization's gross receipts. Would this exception apply to my situation in any way? Are there any other traps in doing this that I should be aware of? I'm not a non-profit expert by any means. | |
