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How to Start a Parent-Teacher Organization

There are plenty of difficult parts to running a parent-teacher group, but setting up the organization is very straightforward.

Let’s walk through each step together so you understand what you need to do.

There is a slight difference between a PTA and a PTO or PTG. If you want to start a PTA, then your next step should be to sign up at https://www.pta.org/. Being a member of this nationwide organization is a bit like owning a local franchise: you have to pay some entry fees, but they will guide you along the process.

The rest of this guide assumes that you’ve opted to be a PTO or a PTG.

Step 1: Connect with the School

Most schools are underfunded and overwhelmed, so there’s a good chance your principal will be overjoyed that you want to start a parent-teacher organization. Nevertheless, head into the office and share your plans with the principal. Everything you do in the future will rely on having strong, open lines of communication between the school and your organization.

Make sure there’s a need for a PTO, and ask the principal if there are any particular areas of need (e.g., after-school programs).

Step 2: Assemble a (Provisional) Board

This team is typically an informal group, often referred to as a board. Here’s how to start:

Gather Interested Parents: Identify parents who are passionate about improving the school experience. Reach out at school events, or ask the school if they’re willing to share an announcement about your group.
Define Roles: Even at this early stage, it’s helpful to assign informal roles, such as president, treasurer, and secretary. This structure helps you organize tasks effectively and prepares you for creating a formal board later.

With your group of interested parents and support from school administration, you’re ready to take the next steps.

Step 3: Incorporate Your Organization

Formally incorporating your parent-teacher organization provides it with a legal structure, helping to establish credibility and protect its members from liability. Incorporation also often makes it easier to apply for tax-exempt status and manage finances more formally.

Here’s what you need to do:

Choose a Business Structure: Most PTGs incorporate as a nonprofit, often as a 501(c)(3), which provides tax-exempt benefits and the ability to accept tax-deductible donations.
File Articles of Incorporation: Contact your state’s Secretary of State office or similar governing agency to file Articles of Incorporation. The process varies by state, so check local requirements. Be prepared to submit information about your organization’s purpose, initial board members, and address.
Adopt Bylaws: Once incorporated, create a set of bylaws that outline how your organization will operate. Bylaws typically cover topics such as board meetings, elections, and member roles. (See this handy post about creating bylaws: https://big-nest.com/blog/how-to-build-strong-bylaws/).

Incorporating your PTG adds an essential layer of legitimacy and legal protection, making it a valuable step toward establishing a successful and sustainable organization.

Step 4: File for an Employer Identification Number (EIN)

Before you can open a bank account or apply for tax-exempt status, you’ll need to obtain an Employer Identification Number (EIN) from the IRS. Here’s what you need to know:

What is an EIN? This nine-digit number is essentially the organization’s Social Security number, allowing it to conduct financial transactions.
Who Should Apply? Typically, the organization’s president or another officer will apply for the EIN.
How to Apply: You can apply for an EIN online through the IRS website or by mailing Form SS-4. Once approved, you’ll receive an EIN confirmation notice.

Obtaining your EIN is a vital first step in formalizing your PTG or PTO. With an EIN, you can open a bank account to manage funds, track expenses, and ensure transparency.

Apply for an EIN here.

Step 5: Apply for Tax-Exempt Status (501(c)(3))

Now that you’ve got your EIN, it’s time to apply for tax-exempt status.

The 501(c)(3) status designates your PTG or PTO as a charitable organization, making donations tax-deductible for donors and often allowing for tax-free purchases.

Here’s how to go about it:

Choose the Right Form:
- Form 1023-EZ: If you expect your organization’s gross receipts to be less than $50,000 annually and assets to be below $250,000, you can apply with Form 1023-EZ. It’s simpler and has a quicker turnaround.
- Form 1023: If your organization anticipates higher earnings, use the full Form 1023. This application is more detailed but necessary for larger organizations.
Submit Your Application: Complete the chosen form and submit it to the IRS. You may need additional information, such as your group’s mission and planned activities.
Wait for IRS Approval: The IRS will review your application and, if approved, issue a determination letter. This document confirms that your organization is officially recognized as a 501(c)(3) nonprofit. With this status, your PTG or PTO can offer tax-deductible donations and apply for tax exemptions.

Step 6: Open a Bank Account for the Organization

With your EIN and (hopefully) 501(c)(3) approval, you’re ready to open a bank account. Some banks offer perks like lower fees for charitable organizations, so it’s worth your time to ask other local parent-teacher groups what bank they use.

What You’ll Need: Bring your EIN, a copy of the 501(c)(3) determination letter, and your organization’s bylaws or mission statement. Banks want to make sure that you’re a legitimate entity.
Set Up Transparency and Controls: If your bank enforces dual-signature requirements for checks or withdrawals, opt into it. This is an important control that requires two signatures from your exec board members any time you write a check or make a withdrawal. Having this requirement creates a system where it’s difficult for one board member to misuse funds.

Step 7: Acquire Insurance for the PTG

Obtaining insurance is an essential step for protecting your PTG and its members. With insurance, you can safeguard the group’s funds and protect members from liability issues that may arise from activities or events. Types of insurance PTGs commonly consider include:

General Liability Insurance: Covers incidents that might happen during events, such as accidental injuries.
Directors and Officers Insurance (D&O): Protects board members in case of lawsuits related to PTG decisions.
Crime Insurance: Covers potential losses from theft or embezzlement, which can be particularly relevant for organizations that handle funds.

Talk to an insurance provider about your group’s specific needs, and make sure you’re covered for any activities or events that could pose a risk.

Final Thoughts: Building a Lasting Legacy

If you’re even considering creating a PTG, PTO, or PTA, then just go for it. Yes, it involves effort and dedication, but it also brings immense benefits to your school community. Those benefits will be shared by your kids and hundreds of other kids at your school. It’s a tremendous gift to the community and helps support your school’s goals for years to come.