Can an officerbe held liable for back taxes and fines owed to the IRS by a PTO that has never filed for non-profit status or filed any returns?

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Can an officerbe held liable for back taxes and fines owed to the IRS by a PTO that has never filed for non-profit status or filed any returns?

I was voted president of the parent-teacher organization at my daughter’s school. Later I found out that the organization does not have non-profit status nor filed any tax returns. The organization has an EIN from the IRS and a checking account for the last 5 years but only has financial records since last year. What is the liability for board members if the taxes and fines cannot be paid by the organization and it dissolves?

Asked on October 21, 2011 under Bankruptcy Law, Ohio

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Good question. Potentially the members of the organization that did not receive tax exempt status from the Internal Revenue Service could be personally liable for unpaid taxes but that does not seem realistic in your circumstances in that no stock certificates or membership certificates were ever issued by the parent teacher organization for your school to any person. There were only members of the organization.

I suggest that you consult with a certified public accountant or some other tax preparer to assist you with the situation that you are faced with and are writing about. Potentially the parent teacher organization can be absorbed into the tax exempt status of the school that you daughter attends.

Good luck.


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