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Applying for a Federal ID number
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Friday, September 18, 2015 at 9:08 PM
We are now facing the issue of applying for a Federal ID number because of the need to set up a Paypal account. In prior years we didn't take credit cards, and just used the social security number of the Treasurer to set up the bank account. I know that the topic of not-for-profit status has come up before. Certainly those organizations that raise outside funds need to go through the process. But I am wondering how the average reunion organizations handle the issue of applying for your Federal ID number. Do you have the Treasurer apply for the PayPal account using a DBA as a sole practitioner? Looking for some guidance.
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Saturday, September 19, 2015 at 9:46 AM - Response #1
I'm not sure what we have for an account, I think someone else set up our class PayPal 5 years ago and I just took over this year as an administrator. If you have a classmate who is a CPA or an accountant who helps you with your personal taxes, could you call them to see what they suggest. Good luck and keep us posted. This is a common concern for anyone starting their PayPal account recently.
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Saturday, September 19, 2015 at 9:52 AM - Response #2
We used Paypal 4 year ago and will be needing again next year for our 50th. I think I just used my own account and ran it through there. I don't really use it for anything else. Are there issues with this? We probably only ran about $4000 through there. Janie
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Saturday, September 19, 2015 at 10:08 AM - Response #3
We just ran into this issue when setting up a business Paypal account. It really has to do with whatever SSN was used to set up your checking account that you are running this through. As long as there aren't any interest income issues (although check with an accountant), you shouldn't need a tax id. We only had about $1500 at any given time in the account and when we had a reunion the money went in and out.
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Sunday, September 20, 2015 at 2:58 PM - Response #4
Following up on my original question, do I understand correctly that many reunion organizations are using a personal social security number to set up their bank account and now are extending this to their "business" Paypal account by using that same social security number. Do you then apply for a Federal ID number by stating that the organization is a sole proprietorship?
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Sunday, September 20, 2015 at 3:25 PM - Response #5
My bank lets me have an extra checking account with no fees. I run everything through this checking account and I run everything through my own paypal. We only have events every 5 years. No federal ID.
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Sunday, September 20, 2015 at 8:01 PM - Response #6
Same as Janie. Although we don't use PayPal - all 7 Committee members have access to bank funds in case of emergency. 25 years ago we had a non profit Tax ID# which has expired. My CPA advised for our 50th renewing our Tax ID wasn't worth the hassle for a variety of reasons. All expenses are paid by Cashiers Check - no bank fees attached.
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