How to set up a bank account for your team?

[Maillemaker]

Hi all,

How do you go about setting up a bank account for your team?

When I was participating in another reeancting 501c3 non-profit group (SCA), each group's account was actually owned by the national organization - the chapter accounts were DBA (doing business as) only.

Presumably the N-SSA is the same way? Presumably I need the N-SSA's Taxpayer ID number to open a 501c3 bank account as a chapter organization of the N-SSA? I don't think I want to open it under my own Social Security number...

My bank is very accommodating with non-profit organizations and offers free checking accounts to them.

Steve

[MR. GADGET]

Our account has always been under the Unit using the unit as the name with signers on the account.
It was just a checking account and they changed a 1$ fee or something like that with no interest paid or real limits.
When I got on it the account was under someone else so me and him went in to add me.
All I needed was a DL.

Don't know if the first person set it up using a SSN years ago or not.
Maybe....

I don't think the NSSA should let you use the tax ID number to set up accounts. Just something does not sound correct with that. Ask people in your region how they do it. They would be local and maybe have contacts and info that would apply to your region or state.

One thing for sure have more than one person on the account. If they quit or die it locks up the money...

[Maillemaker]

I've spoken to our regional commander but he did not know any more than I already knew - go set up a free non-profit account with the bank (we even use the same bank). But, the bank wants the non-profit information for setting up a bank account.

Is everyone is setting up team accounts using personal financial information?

Steve

[Mike McDaniel]

You can get an Employer Identification Number (what you need for the account) from the IRS. It's an online application.

[Maillemaker]

You can get an Employer Identification Number (what you need for the account) from the IRS. It's an online application.

This is true, but if you want to open a bank account as a chapter of a 501c3 nonprofit then you need the taxpayer ID of the 501c3 nonprofit. Just got back from the bank.

I have just re-discovered the list of N-SSA officers on the Contact page of the N-SSA.org site; I will email the paymaster.

Steve

[MR. GADGET]

Why worry with having it a 501? What good will it do.

Most dont ever have a large account.

[Maillemaker]

Why worry with having it a 501? What good will it do.

Well, for starters, Regions offers free checking accounts to non-profit organizations.

But also, I'm puzzled that chapter members of a 501c3 are using personal checking accounts to manage group funds. In the last non-profit where I dealt with finances, all of the chapter organizations had DBA accounts all in the name of the parent organization. As I recall this was because otherwise the chapter organizations would need a separate non-profit set up in each state where they resided to keep their funds non-profit. But I'm not up on all the financial stuff so I'm not sure how it all works.

I just know when the SCA got sued in a multi-million-dollar lawsuit all chapter organizations had to donate 10% of their bank accounts to the national organization to pay the expenses, since they all belonged to the SCA, Inc.

I suspect all N-SSA chapter funds also probably are supposed to belong to the N-SSA, Inc. but again, I'm not sure how all this works.

I just know that according to Regions Bank if you want to set up a free non-profit checking account you need the taxpayer ID of the non-profit plus meeting notes from the local chapter designating the people to be listed on the account.

Steve

[MR. GADGET]

We are members of the 501c3 but that does not make a unit a 501c3 just a member of that group.

I see no benefit to setting up a local group that is member of a organization that has the charter.

What are you really after or wanting to do? What benefits will you get buy trying to use the 501c3 of the NSSA?
Do you have a big money person wanting to donate money to your group?
I have handled the money for our group.for several years and do not see what the gain is.

[Mike McDaniel]

Most teams have a team checking account. If you haven't tried to set up an organization account in the last fifteen years or so, it's more of a PITA than it used to be. These days, you need an EIN...and then the banks want to soak you for fees that will eat a small club's funds. We're running into that problem with my Karate Club. If you can avoid fees with 501c(3) status, you do it.

[Chris Sweeney]

OK, I have been through all of this so here is my take:

1. Your team is NOT a chapter of a 501c3 organization; it is a separate legal entity
2. A 501c3 is a tax exempt non-profit. There are other types of non-profit designations
3. In order to be classified a non-profit or not-for-profit (they aren't the same thing) in most states, you need to incorporate as such. In my state this involves registering with the Dept. of State, providing them with (besides a fee) a set of bylaws that meet the definition of a non-profit or not-for-profit organization.
4. If, in some misguided fit of madness, you wanted to pursue getting 501c3 status you have to register with the Federal Government ("we're here to help..."), pay more fees, fill out tons of paperwork send it in, get it sent back for corrections, fill in new info, run it by your lawyer or accountant . . . you get the idea!

My team is a 501c3. A previous commander went through the effort because he thought we could use donated money for stuff like gear for the members, powder, lead, entry fees, etc. Turns out - not so much! The rules re: use of donations are strictly enforced - you must comply with both the general tax code 501c3 rules and the stated purpose under which you were granted 501c3 status. I am now burdened with having to deal with annual reporting, maintaining separate accounts for 501c3 money and regular team money (thank God for my Paymaster!!!).

If you are not already a nonprofit in the eyes of your state, I'd just get a business account - Any fees are gonna be cheaper than what you'd spend to incorporate. Shop around for some place like Community Bank N.A.