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Arkansas Extension Homemakers Council

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Section C
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Section D
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Section E
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Section F
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Section G
County/Club Officers

Section H
Financial Affairs

Section I
U of A,  Extension

Section J
Legal Matters

Section K
Affiliation With Others

Using ID Numbers on Club Savings Account

Extension Homemakers Clubs are members of County Councils of Arkansas Extension Homemakers Council, all of which have ID (identification) and are included in the Group Exemption Number (GEN) of the State Council.

The Arkansas Extension Homemakers Council and its subordinates, or County Councils, are classified by Internal Revenue Service (IRS) as 501(c)(3) tax-exempt organizations.

An Arkansas Extension Homemakers Council having monies to deposit in a savings account is required to furnish the bank or savings and loan association an ID number for the account the same as an individual would do. Savings institutions are required to report interest earning of $10 or more to the IRS, giving the ID of the account.

The State Council accountant, Barry B. Findley, CPA, advises that clubs use the County Council ID for their accounts. This does not mean that a club’s money goes into the Council accounts, but it does identify the club as a part of The Council. The separation of the money is in the name of the account. The account should be used as follows:

“Whatever Extension Homemakers Council of the whichever County Extension Homemakers Council – ID 00-0000000” Consult your bank about using simply “Whatever Extension Homemakers Council Club, ID 00-0000000” for deposit and withdrawals, and on the signature card where you specify who is authorized to make withdrawals and how many signatures are required.

The reason for this procedure, rather than securing their individual ID numbers, is that it would mean each club holding an ID number would be liable for IRS reports.

If a club has already obtained an ID number and is receiving and filing tax forms from IRS, continue to do so.

Mr. Findley recommends no more clubs file for ID numbers, using instead the County Council ID whenever one is required.

IRS Reports

There are usually inquires about the Internal Revenue Form 990 and 990A for your County Extension Homemakers Council.

First, the IRS forms should reach you before the end of your fiscal year. The return is due no later than the 15th day of the 5th month following the close of the fiscal year.

Secondly, some of you may not receive the form and later may receive a letter from the IRS requesting explanation of why your Extension Homemakers Council did not report. If your council is one of those, contact the State Extension Office when you receive your letter.

For those who receive the form, follow this procedure:

• Above the address box there is a space for the date of the fiscal year; insert “July 1, ___,” ending “June 30, ___.”
• The address label bear the name, address, and probably numbers. Peel this off and attach to the form as directed.
• On line D, to the right of the address box, insert your council ID number.
• On line G, to the right of the address box, insert your council ID number.
• On line G, check the square before 501(c), and insert 3.
• On line H (a), the lower line applies; check “yes” for group affiliate. Line 1, “if yes” give GEN number, insert 2140.
• On line J, check “cash.”
• On line K: Check the square indicating income is less than $25,000 – unless your council has more. (If your council has more than $25,000, contact the State Extension Office.)
• Immediately below line G you will read “501(c)(3) organizations must also complete Schedule A (Form 990) and attach to this form.” You will have to request that form from the IRS if not with the form package.
• Before going into Schedule A, complete the 990 by turning to page 6. At the bottom on the line “signature officers,” “date,” “title,” have your Council Treasurer sign, date, and write “Treasurer.”

Now to Schedule A:

• Fill in the council name and ID number in the top space.
• Part I –Write large “Not Applicable”
• Part II –Write large “Not Applicable”
• Part III, Line 1 – Check “No”
• Line 2 – Check “No” for all parts
• Line 3 – Check “No”
• Line 4a – Check “No”
• Part IV, Page 2
• Line 13 – Check square
• Line 13a – Arkansas Extension Homemakers Council
• Line 13b – 12

When you have the 990 and Schedule A completed, make a copy for your file on firm white paper or on a duplicate set of forms, write “file copy” in large letters, and file for future reference. Mail the 990 and Schedule A to Internal Revenue Service Center, Atlanta, Georgia 31101.

These instructions have been reviewed and approved by Barry B. Findley, CPA, Accountant for The Council.

Out-of-Pocket Un-reimbursed Expenses Incurred in Rendering Service to Tax-Exempt Organizations

From time to time there are questions about claiming deductions on income tax for expenses incurred in volunteer work for tax-exempt organizations, of which Extension Homemakers Council is one.

Certain out-of-pocket expenses are allowable by Internal Revenue Service, but not charges for personal time or services.

Below is a brief explanation of the rules regarding volunteer unreimbursed expenses. This applies to EHC, 4-H, church, and other tax-exempt organizations. This information may be helpful to Extension Homemakers Council members in preparing personal income tax returns.

The value of service rendered to a charitable organization, such as an Extension Homemakers Council, is not deductible as a contribution. But an out-of-pocket un-reimbursed expense, such as those for transportation, travel, telephone, etc., incurred in rendering such service is deductible as a contribution. This includes reasonable payments for necessary meals and lodging while away from home overnight donating services to a qualified charitable organization.

• Convention expenses that are out-of-pocket, if one is a delegate to that convention, may be deducted.
• Special uniforms that are distinctive with patches or logo, not otherwise suitable for everyday wear, are deductible.
• Contributions of time and services are not considered deductible items.
• Expenses for babysitters are not deductible.
• Instead of a deduction based on actual expenses incurred in using an automobile for transportation, a standard rate per mile may be used in computing the cost of operating an automobile where such transportation expense is deductible as a charitable contribution. (The standard rate per mile changes every year. Check your IRS form for the current rate.) Under the standard rate method, parking fees and tolls are deductible in addition to the standard rate per mile. Depreciation and insurance are not deductible as part of the contribution.
• Out-of-pocket un-reimbursed expenses involved in rendering service to a qualified charitable organization are reported on Form 1040, Schedule A, “Itemized Deductions,” along with other deductible contributions, taxes, interest, medical expenses, and miscellaneous deductions. Taxpayers may use a standard deduction in lieu of itemized deductions. Consult IRS Form 1040 instructions.

It is important that the volunteer keep accurate records and be able to validate claims. Volunteers may want to check with their local IRS office if there are questions or additional information is needed.

The IRS has a toll-free telephone number within the State of Arkansas to allow taxpayers to get immediate information and assistance. The number is 1-800-829-1040.