Set Up Homeschool Family as a Charity

Carol Topp, the Homeschool CPA is sometimes asked if a homeschool family can be a charity.  Sometimes a homeschool spouse wants to set up a business and hire their spouse to homeschool their children. Can this be done?Carol Topp, the Homeschool CPA is sometimes asked if a homeschool family can be a charity.  Sometimes a homeschool spouse wants to set up a business and hire their spouse to homeschool their children.

Can this be done?

Are there tax breaks for doing this?

R.A. writes, “I would like some preliminary information on setting up a 501(c)(7). I would like to set up my homeschool (my wife and 3 kids) up as a charitable organization. We have been homeschooling for 12 years.”

Here’s her reply to these situations on today’s episode of the Homeschool Leader podcast.

  • Can R.A. set up his family as a charitable organization?
  • What’s a 501c3?
  • What’s a 501c7?
  • What’s the difference between a 501c3 and a 501c7?
  • Why your family cannot be a nonprofit
  • Why you shouldn’t hire your spouse to homeschool your children.

In the podcast, Carol referenced a few sources from the IRS:

A nonprofit tax exempt organization must serve a public good, not the private interests of the founder or his family. The IRS is very clear on this point. https://www.irs.gov/charities-non-profits/charitable-organizations/exemption-requirements-section-501c3-organizations

501c7 Social clubs must be formed for exempt purposes. Serving only your family is not an exempt purpose. See: https://www.irs.gov/charities-non-profits/other-non-profits/social-clubs

Carol has a few blog posts on this idea:

Incorporate yourself and write off homeschool expenses

Can my family’s homeschool be a nonprofit?

Is my homeschool a nonprofit?

Featured Product

In the podcast I mentioned my book

The IRS and Your Homeschool Organization

Does your homeschool group need to pay taxes? Could they avoid paying taxes by being a 501c3 tax exempt organization? Do you know the pros and cons of 501c3 status? Do you know what 501c3 status could mean for your homeschool group?

I have the answers for you in my book The IRS and Your Homeschool Organization. The information I share in my book has been helpful to homeschool support groups, co-ops, music and sports groups and will help you understand:

  • The benefits of 501c3 status
  • The disadvantages too!
  • What it takes to make the IRS happy
  • What your state requires
  • Why your organization should consider becoming a nonprofit corporation
  • What is the difference between nonprofit incorporation and tax exemption
  • IRS requirements after you are tax exempt

The webinar Create a Nonprofit for Your Homeschool Community is also helpful.

Paying Volunteer Teachers

A homeschool leader asks if the way her group pays volunteer teacher is legal.A homeschool leader asks if the way her group pays volunteer teacher is legal.

Holly, a homeschool group leader emailed HomeschoolCPA Carol Topp this situation:

“I need guidance on the method with which our organization’s volunteers are paid teacher fees. We are collecting cash from all the members for their children’s class fees, and redistributing it to the teachers for their class payment.

Apparently this is being done to simply the process and so members do not have to write checks. I am concerned this is an illegal practice.”

Listen as Carol explains

  • Whether this is legal
  • Are these teachers really volunteers?
  • Should the teachers be employees or Independent Contractors?
  • What Holly’s organizations needs to do regarding paying teachers
  • A simpler option

Featured Product

In the podcast I mentioned my book

Paying Workers in a Homeschool Organization

Are you paying workers in your homeschool organization?

  • Can a volunteer be paid?
  • Should a worker be treated as an employee or independent contractor?
  • Do you know the difference?

Homeschool leader and CPA, Carol Topp, has the answers to your questions in her book Paying Workers in a Homeschool Organization.

This 130 page book covers paying workers as employees or independent contractors. There are also chapters on paying volunteers and board members. It includes sample forms, tips and advice to help you pay workers in accordance with the IRS laws to help your organization pay their workers correctly. Written specifically for homeschool organizations.

 

 

Q&A: Do I Give Classical Conversations a 1099-MISC?

Carol Topp starts a new feature: Q&A with HomeschoolCPA in her podcast for homeschool leaders.  In this first Q&A session, she is asked by a Classical Conversations® Director if she needs to give Classical Conversations® Corporation a 1099-MISC for the licensing fees she pays them.

It’s an excellent question and Carol Topp, CPA explains the purpose of the 1099-MISC, who needs to get one and why.

 

In the podcast Carol mentioned an online service she uses to prepare her 1099-MISC statements, Yearli.com.  If you use this referral link you save 15% and Carol makes a small commission.

 

In the podcast Carol mentioned her book Paying Workers in a Homeschool Organization. This 130 page book covers paying workers as employees or independent contractors. It includes sample forms, tips, and advice to help you pay workers in accordance with the IRS laws to help your organization pay their workers correctly. Written specifically for homeschool organizations and businesses.

 

Featured Product

 

CC Directors and tutors may find Carol’s latest book Taxes for Homeschool Business Owners to be useful this tax season.

 

And she’s giving it away for free, but only in January 2020!

The ebook is 60 pages long and contains information on:

  • Business Start Up
  • LLC status
  • Tax Deductions
  • Tax Forms
  • Sample Tax Returns
  • Self Employment Tax
  • Paying Yourself
  • Paying Others
  • Businesses Using Churches
  • Should My Homeschool Program Be a Nonprofit?

This ebook is a great resource for:

  • Tutors or teachers for a homeschool program paid as an Independent Contractor
  • Classical Conversations®Directors
  • CC tutors
  • Coaches, musicians, artists, etc. hired to teach at a homeschool co-op

 

Get your copy of the ebook Taxes for Homeschool Business Owners today Homeschoolcpa.com/TAXESHSBIZ

 

 

Free Ebook: Taxes for Homeschool Business Owners

Are you a tutor, teacher or CC director of a homeschool business? You might be very confused about your taxes.

Carol Topp, the HomeschoolCPA, has a book for you! And she’s giving it away for free, but only in January 2020!

The ebook is 60 pages long and contains information on:

  • Business Start Up
  • LLC status
  • Tax Deductions
  • Tax Forms
  • Sample Tax Returns
  • Self Employment Tax
  • Paying Yourself
  • Paying Others
  • Businesses Using Churches
  • Should My Homeschool Program Be a Nonprofit?

This ebook is a great resource for:

  • Tutors or teachers for a homeschool program paid as an Independent Contractor
  • Classical Conversations®Directors
  • CC tutors
  • Coaches, musicians, artists, etc. hired to teach at a homeschool co-op

 

Get your copy of the ebook Taxes for Homeschool Business Owners today (all it costs is your email)

Homeschoolcpa.com/TAXESHSBIZ

 

Featured Product

Carol Topp, CPA also offers a recorded webinar that explains the details of preparing a tax return called “Tax Prep for Homeschool Business Owners.”

It will be very helpful (in addition to the ebook).

The cost to view the 90 minute webinar is $10.  Purchase the Tax Prep Webinar for $10

The webinar recording covers:

  • IRS tax forms for a sole proprietorship: Schedule C and SE
  • Self-employment tax
  • How to pay yourself
  • Tax deductions common to homeschool business owners
  • New tax deduction for 2018! Look out for this one. It’s terrific!
  • Two sample tax returns. Yes, I walk you through two sample tax returns, so you can see how everything looks. 🙂
  • Common mistakes to avoid

Purchase the Tax Prep Webinar for $10

Do It Yourself Application for 501c3 Status

Do It Yourself Application for 501c3 Status – Carol Topp, the HomeschoolCPA enjoys sharing her knowledge via webinars including these three she mentions on the podcast:

  • Create a Nonprofit Organization for Your Homeschool Community: This first webinar explains the differences between running a business and a nonprofit. Carol explains boards, budgets and Bylaws and Nonprofit Incorporation for your homeschool group.
  • 501c3 Application: This second webinar explains what is needed to apply for 501c3 tax exempt stats and who is eligible to use the 1023-EZ. Then Carol takes you through the IRS Form 1023-EZ line-by-line and offers tips and advice from her experience.
  • IRS and State Filings: This third webinar addresses what comes after your 501c3 application including the IRS Annual Information Return Form 990 and common state filings.

Here’s a list to all of HomeschoolCPA webinars including a free one on Financial Reports for Homeschool Groups.

These webinars are great for:

  • Homeschoolers just starting a homeschool group
  • Homeschoolgroups that have been in existence for a while, but never applied for 501c3 tax exempt status
  • A group that learns its 501c3 status was revoked for failure to file the IRS for 990.

Why is Carol sharing her secrets?

  • She repeats herself a lot to clients!
  • Some homeschool leaders don’t have a lot of funds. They can DIY and save money.
  • Some people love visual learning with webinars

 Listen to more episodes of this podcast here!

Featured Product

Are you a Do-It-Yourself (DIY) person? Since you are a homeschool parent, you likely are!

So maybe you’re ready to apply for 501c3 tax exempt status for your homeschool group all by yourself (with a little help).

Carol Topp, the HomeschoolCPA has a three-webinar set to help you form a nonprofit, apply for 501c3 status and maintain it!

This 3-webinar set includes:

·      Create a Nonprofit Organization for Your Homeschool Community

·      501c3 Application for Homeschool Nonprofits

·      IRS and State Filings for Homeschool Nonprofits

(click each title for details)

The 3-video set plus resources, ebooks, checklists, etc. It sells for $50

Buy the 3 webinar set (and all the extras) today.

 

Do It Yourself Application for 501c3 Status for Homeschool Groups - Homeschool CPA Podcast

 

Top 10 Tips for Homeschool Leaders: Insurance & Record Keeping

In this episode Carol Topp, CPA discusses the various types of insurance a typical homeschool group might need.Homeschool leaders sometimes wonder when they need an insurance policy. And what type of policy do they need?

 

In this episode Carol Topp, CPA discusses the various types of insurance a typical homeschool group might need. Additionally, homeschool leaders get a few tips on record keeping and reimbursements for expenses.

 

This is the final part of a 5-part series on Top 10 Tips for Homeschool Leaders, a workshop given to homeschool leaders in Wichita, Kansas

 

Each episode can be found at HomeschoolCPA.com/Podcast. In the 5 part podcast series Carol will cover:

Episode # 180 Board duties

Episode # 181 Bylaws

Episode # 182 Preventing fraud

Episode # 183 Paying Workers

Episode # 184 Insurance and Record keeping

Find more Homeschool CPA episodes here!

 

Featured Product

Webinar on Financial Statements

In the webinar Carol mentioned record keeping, reimbursements, and financial statements. To help homeschool leaders, especially treasurers, Carol has a free webinar on Financial Reports for Homeschool Groups. She shows you good, bad and really ugly financial reports!

Watch the webinar (no cost) here.


Thank you to our Sponsor – A Beautiful Day in the Neighborhood Movie!

Tom Hanks portrays Mister Rogers in A BEAUTIFUL DAY IN THE NEIGHBORHOOD, a timely story of kindness triumphing over cynicism, based on the true story of a real-life friendship between Fred Rogers and journalist Tom Junod. After a jaded magazine writer (Emmy winner Matthew Rhys) is assigned a profile of Fred Rogers, he overcomes his skepticism, learning about kindness, love and forgiveness from America’s most beloved neighbor.

Top 10 Tips for Homeschool Leaders: Paying Workers

Homeschool leaders have a lot of questions about paying teachers and other workers. Join Carol Topp, CPA as she covers several topics regarding these questions.Lots of homeschool groups hire and pay teachers to conduct classes. Sometimes these teachers are homeschool parents, but sometimes they are professional instructors. Homeschool leaders have a lot of questions about paying teachers and other workers.

Topics in this episode include:

• Independent Contractor or employee
• The factors the IRS considers in classifying workers
• What if parents pay teachers directly?
• How paying teachers affects your church host
• Can Independent Contractors receive tuition discounts

This is the fourth part of a 5-part series on Top 10 Tips for Homeschool Leaders, a workshop given to homeschool leaders in Wichita, Kansas.

Each episode can be found at HomeschoolCPA.com/Podcast. In the 5-part podcast series Carol will cover:
Episode # 180 Board duties
Episode # 181 Bylaws
Episode # 182 Preventing fraud
Episode # 183 Paying Workers
Episode # 184 Insurance and Record keeping
 

Featured Resource:

Paying Workers in a Homeschool Organization
Are you paying workers in your homeschool organization?

• Can a volunteer be paid?
• Should a worker be treated as an employee or independent contractor?
• Do you know the difference?

Homeschool leader and CPA, Carol Topp, has the answers to your questions in her book Paying Workers in a Homeschool Organization.
This 130 page book covers paying workers as employees or independent contractors. There are also chapters on paying volunteers and board members. It includes sample forms, tips and advice to help you pay workers in accordance with the IRS laws to help your organization pay their workers correctly. Written specifically for homeschool organizations.

Top 10 Tips for Homeschool Leaders: Preventing Fraud

Let’s hope fraud or embezzlement never happens in your homeschool group! Carol Topp, CPA shares some tips to prevent fraud.Top 10 Tips for Homeschool Leaders: Preventing Fraud

 

Let’s hope fraud or embezzlement never happens in your homeschool group! Do you have safeguards to spot it and prevent it?

 

This is the third part of a 5-part series on Top 10 Tips for Running a Homeschool Group, Carol Topp, CPA shares some tips to prevent fraud. The recording is from workshop given to homeschool leaders in Wichita, Kansas. You will find the audience questions might be a question you would ask!

 

In the podcast Carol mentions her list of “Best Practices to Prevent Fraud.” Find it here.

 

Each episode can be found at HomeschoolCPA.com/Podcast. In the 5 part podcast series Carol will cover:

Episode # 180 Board duties

Episode # 181 Bylaws

Episode # 182 Preventing fraud

Episode # 183 Paying Workers

Episode # 184 Insurance and Record keeping

 

Featured Product

Carol Topp, CPA has written a book just for homeschool treasurers:

Money Management in a Homeschool Organization

  • Does your homeschool group manage their money well?
  • Do you have a budget and know where the money is spent?
  • Do you know how to prevent fraud?

This 115 page book will help you to open a checking account, establish a budget, prevent mistakes and fraud, use software to keep the books, prepare a financial statement and hire workers. Sample forms and examples of financial statements in clear English are provided.

Click here for more information

 

 

Top 10 Tips for Homeschool Leaders: Bylaws

Are bylaws and a board really necessary or is that only for homeschool groups that are 501c3 nonprofits? Carol Topp, CPA, will answer that question and discuss bylaws and boards. She even explains IRS 501c3 tax exempt status too!Top 10 Tips for Homeschool Leaders: Bylaws

 

“Are bylaws and a board really necessary or is that only for homeschool groups that are 501c3 nonprofits?” was a great question asked by a homeschool leader at a workshop given to homeschool leaders in Wichita, Kansas.

 

In this second part of a 5-part series on Top 10 Tips for Running a Homeschool Group, Carol Topp, CPA, will answer that question and discuss bylaws and boards. She even explains IRS 501c3 tax exempt status too!

 

Each episode can be found at HomeschoolCPA.com/Podcast. In the 5 part podcast series Carol will cover:

Episode # 180 Board duties

Episode # 181 Bylaws

Episode # 182 Preventing fraud

Episode # 183 Paying Workers

Episode # 184 Insurance and Record keeping

 

In the podcast Carol mentions how a tiny homeschool group should maintain its tax exempt status by filing and annual IRS Form 990-N. Here’s how to do that:

How to get added to the IRS database and file the Form 990N

 

You might find Carol’s podcast series for Tiny Homeschool groups helpful

Tiny Homeschool Groups: Are We a Nonprofit?

 

 

Featured Resource

Start a Nonprofit and Get Tax Exempt 3-webinar set

 

Webinars are a great way to learn!

This 3-webinar set will help your homeschool group get established as a nonprofit, apply for IRS 501c3 tax exempt status and maintain it with IRS and state annual reports!

Everything you need to know in an easy-to-understand video format. This set includes the 3 videos (90 minutes each), an ebook The IRS and Your Homeschool Organization by Carol Topp, CPA, the slide handouts, IRS forms, and templates to help you apply for 501c3 status on your own!

Learn more.

Top 10 Tips for Homeschool Leaders: Board Duties

Carol Topp, the Homeschool CPA explains the 4 duties of nonprofit board members: Duty of Care, Loyalty, Compliance and Management.Top 10 Tips for Homeschool Leaders: Board duties

What does it take to be a board member of a homeschool group? Is it just attending meetings? Carol Topp, the Homeschool CPA explains the 4 duties of nonprofit board members:

Duty of Care, Loyalty, Compliance and Management.

 

This is the first part of a 5-part series on Top 10 Tips for Running a Homeschool Group, a workshop given to homeschool leaders in Wichita, Kansas. You will probably find many of the audience questions would be a question you might ask as well!

 

Each episode can be found at HomeschoolCPA.com/Podcast. In the 5 part podcast series Carol will cover:

Episode # 180 Board duties

Episode # 181 Bylaws

Episode # 182 Preventing fraud

Episode # 183 Paying Workers

I Episode # 184 Insurance and Record keeping

 

Featured Product

The  Board Manual for homeschool organizations will be very helpful to organize your board and run your homeschool organization successfully!

Author and homeschool advisor, Carol Topp, CPA, has created a Homeschool Organization Board Manual. It is a template to create a board member binder. It has:

  • A list of important documents to keep in your binder
  • Section dividers so you can organize the important papers
  • Tools to help you run your meetings smoothly including
  • A sample agenda that you can use over and over again
  • A calendar of board meetings

But this is more than just a few cover sheets for your binder. It is also a 55-page board training manual with helpful articles on:

  • Suggested Board Meeting Topic List
  • Board Duties
  • Job Descriptions for Board of Directors
  • What Belongs in the Bylaws?
  • Compensation and Benefits for Board Members
  • Best Financial Practices Checklist
  • How to Read and Understand Financial Statements
  • Developing a Child Protection Policy

Read more about the Homeschool Organization Board Manual