Finances & Funds
Yes it will, but it can be minimized by raising the price of item slightly to cover the tax that will be due. For example, Regions may choose to sell T-Shirts for $25 each instead of $20.
In general, this is true as the majority of our revenue comes from player registration fees that are almost universally considered exempt from sales tax. A number of Regions have other sources of revenue however such as fundraising activities. Fundraising activities include sales of merchandise such as T-shirts, and concession sales, which some states do consider to be taxable even though AYSO is considered a non-profit charitable organization. In addition, certain states consider a variety of purchases to be taxable, such as uniforms or equipment. In general uniforms are treated one of three ways, non-taxable, taxable upon the purchase of any kind of uniform or taxable for the sale of player uniforms. Equipment is treated either as taxable or non-taxable in certain states that we have an exemption specifically for consumable items (ie; purchases used to run the program).e comes from player registration fees that are almost universally considered exempt from sales tax. Many Regions have other sources of revenue however such as fundraising activities. Fundraising activities include sales of merchandise such as T-shirts, and concession sales, which some states do consider to be taxable even though AYSO is considered a non-profit charitable organization.
The Annual Audit is performed at the end of the fiscal year, which is June 30. The Auditor can arrange a convenient time with the Treasurer and/or Regional Commissioner. With NAP Online, an Auditor can conduct an audit at any time and oversee the financial transactions, records of the Region on a regular basis.
And audit is also recommended anytime there is an executive member (RC, AD, SD) or Treasurer change.
Revenue recorded in the following NAP accounts will be taxable in several states; codes 4010 (Merchandise revenue), 4012 (T-shirts revenue), 4024 (Concessions revenue), 4027 (Concessions – Packaged). The same is true for Expense codes that are noted in the memo section of each check. The expense codes that are noted in the memo section of each check are entered into AYSO’s financial system which is used to create reports to calculate the fees due and file each state’s sales tax return. The taxable expense codes are; 5105-5108 (Uniforms-NO TAX PAID), 5130 (Equipment) and 5135 (Equipment – NO TAX PAID). It is critical that expenses are being coded to the proper code to insure accurate tax filings and fees. To verify the taxable codes for your state, email salestax@ayso.
The Treasurer or his/her trained representative, must employ a process, using at least two trained volunteers, that will reconcile the number of forms taken in and the amount of monies collected at each registration event. Cash and checks for any event must be deposited the same day collected or on the next banking day. National Player Registration Fees must be paid to the National Office within 30 days of invoice. Note: All players must be registered prior to the Region’s first scheduled practice day.
The primary role of the Treasurer is to safeguard the Region’s monies and assets. Treasurers play a vital role in protecting AYSO’s non-profit status.
Treasurers are responsible for acting within the scope of AYSO’s financial policies, procedures and guidelines. They are responsible for:
- managing accounts receivable (revenue) and accounts payable (expenses).
- providing timely financial reports to the Regional Board and the national Finance department.
- coordinating the annual budget preparation.
- overseeing player registration fee handling, payments.
- abiding by good internal control procedures.
- maintaining financial records for seven years.
- coding deposits and expenses for accurate tax reporting.
- submitting 1099 reports to Finance by January 10 each year.
- Maintain a reserve of at least $5 per player but not more that $12 per players to ensure financial stability of the Region.
Treasurers are required to take:
- AYSO’s Safe Haven
- CDC’s Concussion Awareness training
- Treasurer job training
- NAP Online workshop
AYSO is a single nonprofit organization and certain financial standards must be followed to maintain this status. Extra care is taken because the assets and the liabilities of each Region belong to the entire organization. The Auditor cannot be a board voting member or a person related to the Regional Commissioner, Treasurer, Area Director or Section Director. If the Auditor worked previously as Treasurer, he/she cannot audit his/her own work.
The Auditor performs an annual “check-up” of the Region’s financial activities and reviews the National Accounting Program (NAP) report periodically. The Auditor must report to Section Director or National Office on any large unusual transactions. Auditors are responsible for:
- performing an annual review of a Region, Area or Section finances.
- Review Profit and Loss Statement and Balance Sheet periodically.
- Report “Red Flags” of possible financial mismanagement to the Section Director and the Finance Department.
- Verify internal control procedures.
- Review cancelled checks and bank deposits.
- Review reconciliation of accounts.
Auditor Training includes:
- AYSO’s Safe Haven
- CDC’s Concussion Awareness Training
- Auditor job training
- Treasurer job training.
Some states consider fundraising income to be taxable. Examples of taxable fundraisers are concessions and merchandise sales such as pins or t-shirts. There are also a number of states that consider player uniforms taxable because the player pays for the uniform either out right or within the registration fee. There are also a few states that consider all purchases to be taxable.
The Monthly Deposit Report Form (MDRF) is used to report the proper NAP code of all deposits made by Regions, etc. directly to their bank. This form should be used to record all deposits made and then submitted to the National Office at the end of the bank’s monthly statement period. The Treasurer should review the bank statement for the statement end date. All deposits should be made on the same day or by the next banking day after receiving the cash/checks. The MDRF should be submitted no later than the 10th day of the following month. The form can be mailed, faxed, or emailed directly to the National Office.
The MDRF has all of the known possible categories of revenue subject to sales tax as is required from all Regions, Areas, Sections for all bank accounts by the 5th of each month – unless NAP Online is used as required. The MDRF reports information needed to file accurate sales tax returns for the entire organization.
A deferred account is an account that is recognizing revenue in a future period. These accounts are used for registrations and other revenue that is collected prior to July 1 each year for use in a season subsequent to that date, a fall season. This can be used for sponsorship for a fall team that is also collected prior to July 1.
No, the Treasurer is responsible for assisting the RC with preparing the annual budget and providing reports on past expenditures and receipts, but is not solely responsible for its completion. The entire Regional Board should participate in the development of the annual budget.
The Auditor Manual includes an Auditor Checklist, compete with step by step instructions.
Don’t we need a special cash register to itemize and add-on any sales tax due for each concession or fundraising sale?
No. On receipts received from familiar merchants such as WalMart, the actual amount of sales tax due is added to the price of the merchandise resulting in a new grand total. For AYSO, the Finance Department will calculate sales tax due from sales of merchandise and concessions by simply multiplying the appropriate tax rate for the state times the amount of revenue received from the sale.
Yes! Generally, non-taxable fundraising activities fall into the category of sales of intangible items, such as car washes or often times sales through a third party. Revenue from non-taxable fundraisers should be coded to 4040 – Fundraising – Other which is a non-taxable account code.
No, the AYSO National Office will file all sales tax and other required state tax forms and returns on behalf of the Region as part of our normal support of your Region. Sales taxes apply to Section and Area accounts too. All Sections, Areas, and Regions need to submit their MDRF by the due date and verify that deposits and expenses are coded correctly, so that the National Office can file the tax returns on time.
Under no circumstances should Regions have any direct contact with sales tax agencies, state or local governments. Instead please email SalesTax@ayso.org for assistance.
As a single legal entity, AYSO operates as a single corporation with one tax identification number. Regions setting up their own separate sales tax reporting or communicating directly with a state or local government will cause confusion. As previously mentioned, the National Office will file all sales tax and other required state tax forms and returns.
The National Office will do the calculation, filing and payment for each state. Each Region will then be invoiced separately by the National Office for its portion of the total amount due and paid on its behalf.
Certain states consider all purchases to be taxable. If the vendor did not charge sales tax, a use tax may be owed. Email email@example.com to find out if purchases are considered taxable.