I’m curious to know how other packs are handling finances this year. We had to cancel basically half of the years events that the scouts paid for through dues and fundraising. Are packs giving refunds? Holding onto funds til we see what the fall brings for fundraising? Giving credits towards dues for the next year? How will your pack be handling all this?
I am not a tax consultant. Here is some information from the BSA that I found online, What you can do may vary locally and may depend on the tax status of your chartered organization.
Who is responsible for the finances of the unit?
The unit committee is responsible, but the assets belong to the chartered organization.
- FISCAL POLICIES AND PROCEDURES FOR BSA UNITS FAQ, BSA National Council, Revised: November 2019 BSA Legal Department – This is not tax or legal advice.
Funds raised in the name of Scouting should benefit the entire unit. The tax laws do not permit private benefit, with the exception of an “insubstantial” benefit.
Private benefit may result in the loss of tax-exempt status for the chartering organization, or the local council. Allocating funds raised in the name of Scouting directly to a youth member could
result in self-employment tax liability.
Questions? Please contact your local council.
- INDIVIDUAL SCOUT ACCOUNTS AND FUNDRAISING BY BSA UNITS FAQ, As of 02/11/2014
Well, you need to keep fundraising income separate from dues, first of all… Any fundraising income belongs to the unit as a whole, not individual Scouts. Nobody should be getting a cash payout for fundraising work — that can get you and your chartered organization in trouble with the IRS.
With that said, for our Troop, there are no refunds. Troop dues cover the routine recurring costs of running the unit (registration and insurance for the trailer, advancement stuff, consumable supplies, and things like that).
Fundraising is used for replacing and repairing equipment, providing camperships, and other big ticket items that we cannot afford otherwise.
Most of our activities are pay-as-you-go, too.
Thanks for the feedback. I guess now I’m confused by the two seemingly opposing ideas of ‘Funds raised in the name of Scouting should benefit the entire unit’ and ‘earn their own way’.
This is from the FAQ sheet for Individual Scout Accounts and Fundraising…
"Can my unit credit amounts from fundraising to an individual toward their expenses?
Expenses must be reasonable and related to Scouting for youth to “earn their own way.”
It’s really quite clear. Scouts should pay their own way except they shouldn’t…
The problem is that the IRS and the BSA have different rules. The part about private benefit and allowable expenses is summarized from IRS guidance, while the part about earning their own way is the BSA guidance.
You can manage both of them, but it’s a pain – for years, we recognized Scouts that participated more in fundraisers by allocating more “Scoutbucks” to them, and we’re trying to move away from that model. The one bright spot with the Trails End fundraiser this year is their rewards program, which lets us stop giving Scoutbucks, while still letting the Scouts that work hard at the fundraiser earn a little extra.
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