Finances play a major role in the life of a student organization. Therefore it is crucial for organizations to know the basics about finances in a student organization. The following sections will cover student organization banking, tax exempt status, funding resources, organization budgeting, and fundraising.
Each organization has the opportunity to receive a university budget number in order to charge university expenses to their account. For example, if an organization orders food from catering services, it can be billed to the organization account. In order to receive a budget number, the organization advisor must contact the Accounts Receivable Office at 417-836–5635.
Employer Identification Number
An Employer Identification Number (EIN) is a nine-digit number that the Internal Revenue Service uses to identify those required to file various business tax returns. EINs are used by a wide variety of employers, sole proprietors and corporations, as well as non-profit organizations, as most organizations at Missouri State University are considered. The EIN application process is detailed on the IRS website http://www.irs. gov/business under Search Forms and Publications: SS–4. You may apply online at this site under Business: Employer ID Numbers or follow the below steps:
Complete the SS–4 EIN form, Application for Employer Identification Number. This form is available in the Office of Student Engagement or you can fill the form out online on the IRS website (be sure to print out the form for the organization records).
Call the IRS at 1–800–829–4933 weekdays from 7:00 am to 9:00 pm. A customer service agent will ask for information from the SS–4 form and issue an EIN to you over the phone.
Write this EIN in the upper right corner of the SS–4 (below the perforation) and keep it for the organization’s records. The IRS will then process your number which is required to open a checking account for your organization.
Tax exempt status
Since the clubs of Missouri State University operate with a social, recreational, charitable or educational purpose, your organization may be eligible for tax-exempt status as a 501 (c) organization with the government. There are various exemption requirements based on your category of organization. You need to determine the appropriate requirements for exemption based on your own organization. For more information about the process for receiving exemption from federal tax, please see their website at http://www.irs.ustreas.gov/prod/bus_info/eo/index.html. All tax-exempt/nonprofit status processes are carried out through the state and federal government. Missouri State University and the Office of Student Engagement are not involved with this process.
Organization checking account
The Plaster Student Union houses a Commerce Bank branch to serve the campus community. This may be a convenient bank for many student organizations to use. Feel free to stop by or contact Amy Steele, Missouri State University banking center manager, to set up your organization’s account.
Student organizations are STRONGLY discouraged to open a checking account using an individual’s social security number. The financial burden of that account then rests with that individual and they become responsible for claiming any interest on the account on their own taxes. They also become responsible if there is a problem with the account, such as extra fees or unpaid bills. With such consequences in mind, the following process is a viable alternative without the personal financial burden.
Opening a checking account for your organization requires a two-step process:
First, you will need to obtain an EIN number for your organization. You may do this by following the steps listed under “Employer Identification Number” listed above.
Second, fill out the Articles of Incorporation of a Nonprofit Corporation form and send it to the State. This form is available in the Office of Student Engagement or online at http://www.sos.mo.gov/forms/corp/corp52.pdf. Note that there is a one-time $25 filing fee for this form. Although the form is titled “nonprofit,” this does not establish your organization as a nonprofit organization. To become a recognized nonprofit organization by the state, follow the process listed under “Tax Exempt State” above.
Upon obtaining your EIN number and filing the Articles of Incorporation form, take these two things to the bank of your choice to open a checking account. For further questions, please contact the Office of Student Engagement at 417-836-4386.