Co-op Preschool Taxes HELP

1) Look into becoming a non-profit.

2) Consider turning your co-op into a homeschool co-op.

...This one is slightly more complex...because any "teachers" you hire, have to;
- be classified as an independent contractor (to avoid having to pay taxes through your nose)
- be free to teach their own curriculum. If you supplied them with the curriculum, and then they had to teach it, they're considered employees.

I'll update in a bit with some helpful links, if others don't beat me to it first!

Are you talking about payroll taxes? Social Security, Labor & Industries, etc. related to the employment of a teaher? If so, there is no way around it...you must pay. Are you registered as a non profit? If so then you should not be paying any non payroll taxes. Do you have a friend who is a bookkeeper or accountant? If so they could help explain what you should be paying and what you shouldn't.

Our granddaughter goes to a non profit co op and ran into problems with the IRS just by filing the 941 form (employee ss and income taxes) in error. We needed the help of an accountant to straighten it out.

When I was on the board for our co-op preschool, I remember we filed paper work every year stating we were a "not for profit" organization. I'm pretty sure this exempted us from taxes.
If you need more info on this, let me know... I can try to contact our old treasurer, as I'm sure she would have the specifics. :)

Hope this helps!
-C.

Hi, A. - I am president of a co-op preschool run through our local community college. If you are attached to a college, they should have someone there to provide you with assistance as far as taxes go. And yes, if you have not filed for non-profit status, you should do so asap - it will save you a bundle! We are definitely not a money-making school, but we have been fortunate to be able to provide scholarships to low-income families and still give our teacher a raise. We usually focus on one major fundraiser a year - this year we had a very successful garage sale that netted us over $1000.00. If you have a local Papa Murphy's pizza place, they also have fundraisers where you can sell pizza coupon cards for $5 - you keep $4, they get $1 for every card sold. We made $750 on this last fall and are doing it again in April. I always feel like fundraisers are a pain for the families to have to do,so we try to limit them, but it is definitely necessary to keep the school going. Best wishes on this - I'd love to hear how your situation turns out! We NEED more co-op preschools!

As Zoe suggested, look into becoming a non-profit organization. The simplest way to do that might be to look into getting your group under an umbrella organization like a community college, school or church that is already a non-profit. The community college co-op preschools in the Seattle area are pretty autonomous but they do have the support of the college.

In the short term if you are looking for a great fundraising product, please feel free to contact me!