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#778566 - 07/19/07 04:09 PM Little League Acct
Curious Banker Offline
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Joined: May 2004
Posts: 184
Midwest
How does your bank handle the temp accounts for summer activities? Such as, the coach of a Little League team wants an account to deposit the dues and the checks are payable to the Little League team. He is depositing the funds and will be withdrawing them as well. It is only for the summer. Does the Little League need an EIN? Or, can the account be set up under the coach's SS#? If so, is it a DBA?

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#778591 - 07/19/07 04:22 PM Re: Little League Acct Curious Banker
Al Miller Offline
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Al Miller
Joined: Oct 2000
Posts: 2,416
Pleasanton CA USA
Sounds like a not-for-profit association, not a business (hence no "B" in the DBA question). Unless they want interest on the account, I would not force them to get an EIN.

I would not open such an account for other than a known customer. Are you willing to guarantee to the makers of the checks that the league got the intended benefit? If so, open the account under your customer's name and SSN and title it For Benefit Of (FBO) YourTown Little League. I would expect nominal balances unless the team is heading for the National or World Series. If that happens, the sports editor of the local newspaper will help "police" your customer.

Al
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Opinions expressed are my own and not necessarily shared by my employer.

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#778625 - 07/19/07 04:40 PM Re: Little League Acct Al Miller
Skittles Offline
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Skittles
Joined: Sep 2002
Posts: 13,965
TN
Not that this is the correct way to do it, but we open accounts like Al suggested - as individual accounts (or joint) in the account holder's name with the Little League's name on the 2nd line.
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#778856 - 07/19/07 07:02 PM Re: Little League Acct Skittles
Curious Banker Offline
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Joined: May 2004
Posts: 184
Midwest
Do you also use a FBO on the second line? Or, just the name of the League? Thanks.

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#779305 - 07/20/07 01:58 PM Re: Little League Acct Curious Banker
gcg Offline
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Joined: Mar 2007
Posts: 126
If you open the account in the name of the individual, fbo, how will you document that the individual is authorized to endorse checks made payable to the fbo entity? How do you know the entity has knowledge of the account or approves of the account? Could be an embezzlement situtation.

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#779894 - 07/20/07 06:13 PM Re: Little League Acct Curious Banker
AnnL Offline
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AnnL
Joined: Jan 2003
Posts: 334
Western PA
What happens to the kids money if a levy is issued in the coaches SSN? It very likely will go to the IRS!
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#780260 - 07/20/07 08:44 PM Re: Little League Acct AnnL
Al Miller Offline
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Al Miller
Joined: Oct 2000
Posts: 2,416
Pleasanton CA USA
As I said, this is for known customers only. That things will be done right is solely based on trust (and there probably won't be a lot of $ involved).

As to a levy, it may be technically subject, but the levying officer can release the funds. I have even had them do so on the child's birthday money account. They don't want any bad press for a couple hundred dollars.

Al
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Al Miller, CRCM
Opinions expressed are my own and not necessarily shared by my employer.

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#780330 - 07/20/07 09:11 PM Re: Little League Acct Al Miller
girlsrope2 Offline
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girlsrope2
Joined: Sep 2006
Posts: 114
Land of Capitalism
You may want to refer to a change in the IRS law that takes effect this year. As I understand it, beginning in 2008, small tax-exempt organizations that previously were not required to file returns may be required to file an annual electronic notice, Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations not Required To File Form 990 or 990-EZ. This filing requirement applies to tax periods beginning after December 31, 2006.

Small tax-exempt organizations, whose gross receipts are normally $25,000 or less, are not required to file Form 990, Return of Organization Exempt From Income Tax, or Form 990-EZ, Short Form Return of Organization Exempt from Income Tax. With the enactment of the Pension Protection Act of 2006 (PPA), these small tax-exempt organizations will now be required to file electronically Form 990-N, also known as the e-Postcard, with the IRS annually. Exceptions to this requirement include organizations that are included in a group return, private foundations required to file Form 990-PF, and section 509(a)(3) supporting organizations required to file Form 990 or Form 990-EZ.

Therefore, in attempt to prepare our organizational accounts for this new required filing, we now require they provide a separate EIN number assigned to the association or organization.
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