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Scout Accounts with leftover money

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  • #16
    There is a difference between a district volunteer and a unit volunteer and even more so when something is printed and distrubted to multiple units.

    That difference is that district volunteers work under the direction of a paid executive who is constantly trained about the policies and guidelines of Boy Scouts.

    Unit volunteers work under the direction of a unit committee and, possibly (although for most it seems not likely), the direction of a chartered organization head.

    I doubt that there are very many who understand all of the laws that govern the IRS, tax collection, and the use of charitable money donations.


    • #17

      There''s not quite a problem with what your district has written, just with the way you''re reading it.

      There''s nuthin'' wrong with a unit using fundraised dollars to buy a backpack for a scout to use. But the troop owns the backpack, eh? That way it can be used for other boys who might need a backpack on the next trip, or the next year. There''s certainly nothing wrong with fundraised monies being used for provisions or other trip costs, or other items that are directly related to the organization''s charitable purpose for fundraising.

      But now let''s say a lad and his family does a great job selling popcorn, top of his council. Earns enough to buy a used SUV. The SUV would be used for transportation to scout events and for his parents to drive kids on outings sometimes.

      Do yeh think it would be OK to use fundraised dollars to buy the scout his own car?

      Nah. Now if not a car, how about a bike? Plenty of biking activities in Scouting. Or how ''bout his own boat?

      Givin'' tax law and other such advice in a specific way just isn''t possible with people livin'' in different states, and with CO''s that run the gamut from charitable organizations to fraternal organizations to loose collections of parents. You should not consider anything I or anybody else says here to be legal advice, it ain''t. But in general the principle is that fundraised dollars have to be used for the charitable purpose for which they were collected, i.e., for the organization, not for an individual to build up a bank account or a gear closet. If a portion of the proceeds is given to workers at the fundraiser in dollars or merchandise, then that portion should reflect a reasonable wage for the work - and that''s income that must be reported by the CO (or recipient) to the IRS.

      Yeh can check out IRS Publication 1828 or its equivalent for different exempt organizations. Don''t even need to call, plenty of stuff available on-line. Just understand that the specifics of individual cases can be complimicated, and yeh really want to talk to someone local who knows what''s up if yeh want a real legal opinion. Even da IRS will tell you that yeh can''t rely on what someone on their helpline says.

      Now of course, a lot of this stuff flies under the radar and generally isn''t big enough dollar-wise for anybody to do more than slap someone''s wrist over. That''s your CO''s call as to how "informal" to be.

      For me, though, I''d say it was an issue of substance and ethics. When a boy puts on a uniform and sells something to a member of the community "for Scouting" the proceeds shouldn''t end up in his pocket or in his closet.



      • #18
        Like most troops, we allow scouts to use their account for uniforms or equipment. If they quit or age-out, their money is put into the general fund, or more precisely, the hardship fund we maintain for needy scouts. This fund is sizable just from years of forfeitures. (We don't often need to use it, thankfully.)

        We would never give cash to these scouts because the fundraising was in the context of benefiting scouting, not to mention the tax implications.


        • #19
          I have a situation where there is a scout transferring into my troop from another because his parents moved to a different state. The scout amassed over $800.00. and his original troop refuses, stating that they would, but it is the property of their charter org. It isn't like the scout has a choice, what with the parents moving 1500 miles away.
          Do you think the parents should contact the charter org?


          • #20
            That sounds like an issue between the previous Scout Troop and the family.

            Some units will transfer balances to a different unit, others wont.

            I'd stay out of it other than to say that your troop will maintain Scout accounts for boys in the troop, if indeed you do.


            • #21
              Our troop has looked into this, and we have found a tax determination, with the assistance of a US senator.

              In short, scout accounts are a big no. I will find the letter in my in box and post it.
              Beaver hit it on the head.

              Is there a way to post files or PDF's here?


              • #22
                OGO, I think it's pretty clear that you have no say in how some other troop allocates its own money. By leaving the boy is essentially relinquishing his stewardship over those funds. No harm in the parents contacting the charter org rep to find how set in stone things really are. But make it clear that there's no reason for them to expect things to be any different than what they were told.

                If a transfer is impossible, I would encourage the boy to ask his old troop if he could have some say on how the money would be spent. Maybe he would rather it go to camperships, or a batch of uniform shirts, or eagle project materials. Maybe it could go into paying the fuel for his old patrol to drive over and camp with his new troop some weekend!

                Our troop generally encourages boys to use the money in their accounts as quickly as they earn it. Doing so usually translates into equipment and uniforms being handed down fairly quickly.


                • #23
                  with my sons first troop we had to really work hard to get them to transfer his account money to his new troop. their belief was that most who switched troops dropped shortly after and then the money would end up with that troop rather than them. Our final agreement was that once the boys (a few of his friends switched too) paid first summer camp payment they would transfer over the money.

                  with my sons troop now (only the 1 troop change) we will transfer to another troop. the only time someone can get money out of account is when the family has paid for say philmont trip and there is over payment and a refund is given - treasurer puts it into their accounts and lets them know to come see them for refund check.

                  Our fundraisers are 60% family account (we use family so it's easier with siblings and parents who are active) 40% troop account. When we have money left in a scout account we do it backwards - 60% goes in troop account and 40% goes in support family account (basically a scout account that we use to support those who need it)

                  we have some uniforms to pass along and we've never been asked by anyone if they can use their money for buying uniform or equipment - though I think if someone did we would gather a committee meeting and decide on that.


                  • #24
                    Our troop policy is that it generally goes to the troop general fund. That said, we have had a committee vote to allow a scout to transfer his funds to a friend. This was the case of an aged-out scout that had done a lot of fund raising despite knowing he wasn't going to be able to use the money for his own use.


                    • #25

                      That's a very good point.

                      I'm thinking about inviting those transferring to a troop to continue to submit receipts to the pack for Scout Account expenses and having the pack pay them. Any funds left after a year would be retained by the pack.


                      • #26
                        #1 We will NOT transfer funds if the scout switches units. It's a situation we have not faced yet, but we documented the policy in advance. We believe that the troop program supported the scout raising the funds to participate in the troop's program. If he wants to participate in a different program, that's between him and his new troop. The existing funds were to support his participating in our troop.


                        #2 On the flip side, we may let a scout cash out a scout account IF it can be considered a "reimbursement" of personal payments. The family MUST have personally paid in more then being asked to cash out. Specifically, we did not want to penalize a few parents who wrote $500 checks at the start of the year for deposit into the scout's account.

                        We view all money coming in as a deposit into the scout's account. We view all camp fees, dues, etc. as withdrawls from the same account. So we let scouts cash out to the extent that the family personally deposited. Otherwise, we'd be penalizing scouts and families who in good faith paid early and later earned funds to pay for their event. We be benefiting families who did not pay on time or fell into the red and later earned fundraiser dollars to make it up.


                        #3 We don't do mandatory or "group" fundraisers. Scouts only earn into their scout accounts based on sales they personally did. We don't want to be apportioning funds to individuals. We want to avoid anything close to the following. You worked 3 hours and there was a total of 100 scout hours worked. So you earn 3% of the funds raised.


                        #4 SeattlePioneer wrote: ... Great suggestion. I could see this addressing many concerns. It would be a pain, but worth it. "I'm thinking about inviting those transferring to a troop to continue to submit receipts to the pack for Scout Account expenses and having the pack pay them. Any funds left after a year would be retained by the pack."

                        (This message has been edited by fred8033)


                        • #27
                          Gotta Ask ..If your Not allowed to compensate for assisting in sales...Does Trail's End have to Stop giving away prizes also..

                          What About prices from Councils?
                          Our Council is giving away a Free IPad2 to the Top Salesman over $3000.00 and Each District Top Saleman get 4 Tickets to Medevil Times In Dallas


                          • #28
                            I've wondered about the prize thing as well.

                            Nevertheless, the IRS documentation is quite clear that you cannot earn money for yourself as part of a charitable fund-raising effort, and our troop has therefore quit allocating any money to Scout accounts from fund-raisers. There are substantial past threads on this topic in this forum.

                            Here's one link: a booster club confers a benefit on a participant in return for their fundraising activities, such as by crediting amounts raised by a participant toward that participants dues requirement, or by crediting amounts raised against the cost of a trip, the booster club is providing a private benefit to that participant. Consequently, such practices could result in the organization failing to be described in 501(c)(3).A quick search didn't reveal anything directly on the point of prizes. I would guess that they may be allowed because they are non-monetary and their value is 'incidental' - but I might question the incidental part for some of the larger prizes.


                            • #29
                              This is EXACTLY why a unit needs by-laws.

                              Our cub unit went to individual "cub bucks" accounts (against my objection) while I was the CM for the unit. I insisted that the unit by-laws be ammended to clearly state WHAT was to be done with "cub bucks" when a scout departs the unit.

                              Age out of cubs, cross over to Boy Scouts, or just up and quit or transfer to another unit... all "cub bucks" were reverted back to the general unit fund to be used by the unit as the unit sees fit. Period.

                              A scout had 30 days from transfer to another unit or cross-over to Boy Scouts, to redeem his scout bucks for scouting related gear. Uniforms, books, camping gear, etc... was all allowed, but he (or parents in this case) had to provide proof of purchase with a copy of the receipt to get reimbursed.

                              I know of one time when a cubbie used some of his left over "cub bucks" for a down payment to his new troop on troop summer camp. That is the closest we ever had to a "transfer" of funds from our unit to another.

                              had one set of parents in 3 years ask for a "cash out" when they were moving out of state. Sorry, nope - by-laws do not allow for it. Scout spent up about 80% of his funds in the month before moving on new gear... thats fine by me.

                              The point is: have the policy well defined BEFORE the issue comes up and apply the standard equally. My own son had a few bucks left in his account (about $35) when we graduated into Boy Scouts. We used $8 to buy his handbook and left the rest to the pack.

                              My 2 cents...