Washington State 4-H Staff Resources DRAFT DOCUMENT This is a draft document for instructional purposes only. Items in this handbook may change in the final review. 1
Table of Contents Financial Checklist Staff...3 Obtaining an EIN...4 EIN Issues... 17 Authorization to add to group exemption... 19 Donation Communication... 20 Sample W-9... 21 Closing A Club Checklist... 22 How to file a 990-N... 25 Instructions for submitting EIN Report... 35
Washington State 4-H Financial Checklist Staff Obtain an EIN for new club/group after they have been issued a charter. Send EIN letter, 4-H Club Constitution and Bylaws, and Authorization to Include 4-H Club in Group Exemption of Washington State 4-H Youth Development. Manage large donor and W-9 requests. Facilitate closing 4-H clubs. Complete filing 990-Ns, 990s, or 990-EZs for all clubs/groups. Submit County EIN list to the State 4-H Office by January 15th of each program year. Submit closed club documentation by January 15th of each program year. 2
Obtaining an EIN for a Club/Group/Program Faculty and staff working with 4-H are the only individuals authorized to apply for Employer Identification Numbers (EINs). Prior to beginning the process, each group must be chartered and prepared to operate as a 4-H entity. Once you have gathered the name of the club and the address of the club leader, begin the application process. There are two options for applying for your EIN. First, and what seems to be the most fail-proof method, you can submit a paper Form SS-4. Complete your SS-4 using the template that follows this page. Use your name as the Care of name in Box number 3. Sign, date, and fax the application into the IRS. You should receive an EIN letter through snail mail within 2-3 weeks. Fax the SS-4 form to this number: 855-641-6935 The following page describes the online process for obtaining your EIN. This method seldom works due to the uniqueness of our group exemption. 3
Online EIN Application Below is a series of screen shots with step-by-step directions. Keep in mind that as a state agency, we may only apply for one EIN per day. While this may be inconvenient, we are certain we will not exceed our calendar-year limit. If you attempt to file and get an error message, please try again the next day. First, navigate to this website: https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employeridentification-number-ein-online You will be directed to the following page: Click on Apply Online Now > You will be directed to the following statement: 4
Click OK The next page provides important information about EINs and the process of applying. Click Begin Application >> 5
On this page, select View Additional Types. Click Continue >> Select Other Non-Profits/Tax-Exempt Organizations. Click Continue >> 6
The next page: Click Continue >> On the next page, select Started a new business. Click Continue >> 7
Select Existing Business. WSU is our sponsoring agency. Click Continue >> Enter Washington State University for the business name, 91 6001108 for the EIN and select I am a responsible and duly authorized Click Continue >> 8
On this page, enter the address for the club leader. Enter the name of 4-H faculty or staff that will maintain oversight of EINs in your club and select Yes on the question about where to have mail sent. Click Continue >> Next page, enter the mailing address for the County Extension 4-H Office. Click Continue >> 9
Enter Washington State University 4-H Youth Development for the legal name. Enter the name of the club/group/program in this format: Clover 4-H Club, Snohomish County 4-H Horse Program, or Darrington 4-H Program, in the Trade name/doing business as field. Enter the county. Enter the state. Enter the start date of the organization (do not go further back than October 1st of the current program year). Click Continue >> 10
On this page, you should be able to answer No to each question. If you cannot, contact the State 4-H Office immediately. Click Continue >> 11
On this page, select Other. Click Continue >> 12
On the next page, enter Youth Development. Click Continue >> On the next page, select Receive letter online. Click Continue >> 13
This is the review page. Please read through all information carefully. If mistakes are made at this point in the application for the EIN, it will be very difficult to change things later. Ensure address and names are correct. Once you are certain all information is correct, Click Continue >> 14
On the next page, you will receive one of the following: A.pdf copy of your letter from the IRS that includes your EIN. o If you get this, congratulations! You did it! An error message that states too many applications have been processed for the university. o If you get this, return to the website and try again the next business day (HINT: try first thing when you get to the office). An error message that states something else went wrong. o If you get this, take a screen shot of the error message (Hold down CTL- ALT-PRINTSCREEN, open a word document, CTL-V). Send the State 4-H Office an email with the error message document attached and wait for further instructions. 15
EIN Issues There are many situations where you may need to speak directly with the IRS. The phone number for the exempt division of the IRS is 877-829-5500. Be prepared to explain the club, what the relationship is with WSU, and affirm that you have legal authority to discuss the club. Please remember that we are unique in the many exempt organizations that they work with and assisting them in understanding our relationships is key. First, each 4-H club is a subordinate to the Washington State 4-H Youth Development Program, Group Exemption Number 5967. You will be asked who is the responsible party? Washington State University, EIN 91-6001108. You will be asked what is your relationship to the club? You are the administrator of the organization. Be sure to explain your problem to the agent and always ask them what do I need to do to resolve this? If your club s EIN has been revoked, you may apply for reinstatement. This option costs $275 and can be completed using IRS Form 1023-EZ. The main reason EINs are revoked is that the club failed to file their 990-N. The club will receive a letter that it has been revoked; if you have documentation that shows the club tried to file, or did file in the years referenced, respond to the IRS and send copies of the documentation. HINT: You will get a quicker response if you fax the documents to the phone number above rather than mail them. This problem should not occur after this year as the 4-H office is now required to file those reports. Change of Name of Club To change the name of a club, write a letter to the IRS requesting the name change. A sample letter can be found on the Staff Resources page of the Washington State 4-H website. Closing a Club (with an active EIN) If you are able to file a 990-N for that club, answer Yes to the question Has your organization terminated or gone out of business? Change of address for a club Use IRS Form 8822B to change the address. However, the only address that should be changed is Box 7, New business location (on the SS-4, Application for an EIN, this is the physical address). The mailing address of the club stays as the 4-H Extension Office address. A sample IRS Form 8822B can be found on the Staff Resources page of the Washington State 4-H website. 16
Leader applies for EIN and uses their own Social Security Number As of October 1, 2016, club leaders are not allowed to apply for EINs. However, sometimes it does happen. If the club leader used their SSN as the responsible party (this usually happens when the call in to get the EIN!), complete the IRS Form 8822B and change the responsible party to Washington State University, EIN 91-6001108. A sample IRS Form 8822B can be found on the Staff Resources page of the Washington State 4-H website. Letter regarding failure to file 990-N If you receive a letter from the IRS that indicates a club hasn t filed their 990-N, don t panic. First, try to file the 990-N for that club; if you are successful, print a confirmation. Follow the directions on the letter, answer the questions, and mail the response and proof of successful filing to the address indicated on the letter. If you are unable to file the 990-N, call the IRS. See beginning of this section for guidance. 17
Washington State 4-H Youth Development Program Authorization to Add 4-H Club or Affiliate in Washington State 4-H Youth Development Group Exemption ( Club ), by its duly authorized officer, authorizes Washington State University through ( Club Leader ) to add the Club as a subordinate to its group exemption number. The undersigned affirms, on behalf of the Club, that the Club will engage in only such activities that qualify it for exemption as a non-profit, charitable educational organization under Section 501(c)(3) of the Internal Revenue Code, and that it will abide by its Articles of Association and The Washington State University 4-H Youth Development Policies and Procedures, as they now exist or may hereafter be amended. Club EIN Club Leader Club Leader Signature Date 18
Donation Communication Of course we want to thank our donors for their contributions, but what are our duties for providing our donor with a receipt? Some donors may ask for our EIN in advance of donating to ensure we are recognized as a 501(c)(3) organization. What if we show up as not being recognized as a 501(c)(3) organization? More than likely this is due to a time lag between when the club/program/group received their EIN, when they were included in the annual statement to the IRS (March 31 of each year), and when the IRS processed the annual report and placed the EIN on the approved list. Sometimes this can take up to one year to process. For example, if the club receives their EIN in May, they are included in the annual report on March 31, and the IRS doesn t add them until the following May. If this should happen, contact your county Extension 4-H Office for guidance on accepting donations. What if the donor asks for our EIN prior to giving the donation? Send the donor a letter providing the EIN, but clearly indicate in the letter that you have not yet received the donation (see Donor Letter Sample 1). How do we send receipts for donations? Once the donation is received, send a letter to the donor acknowledging exactly what they donated. If they give money, receipt money; if they give goods, receipt the goods they gave, etc. (see Donor Letter Sample 2, 3, or 4.) Our donor has asked for a W-9, what do we do? A W-9 form can be obtained from the IRS website (irs.gov). A sample completed W-9 letter is provided for your reference. 19
Form W-9 (Rev. December 2014) Department of the Treasury Internal Revenue Service Print or type See Specific Instructions on page 2. Request for Taxpayer Identification Number and Certification Give Form to the requester. Do not send to the IRS. 1 Name (as shown on your income tax return). Name is required on this line; do not leave this line blank. Washington State University 2 Business name/disregarded entity name, if different from above Clover 4-H Club (use your own club/group/program name) 3 Check appropriate box for federal tax classification; check only one of the following seven boxes: 4 Exemptions (codes apply only to certain entities, not individuals; see Individual/sole proprietor or C Corporation S Corporation Partnership Trust/estate instructions on page 3): single-member LLC Exempt payee code (if any) 1 Limited liability company. Enter the tax classification (C=C corporation, S=S corporation, P=partnership) Exemption from FATCA reporting Note. For a single-member LLC that is disregarded, do not check LLC; check the appropriate box in the line above for the tax classification of the single-member owner. code (if any) 1 Other (see instructions) State owned educational institutional (Applies to accounts maintained outside the U.S.) 5 Address (number, street, and apt. or suite no.) Requester s name and address (optional) Street address of County Extension 4-H Office ABC Merchandise Store 6 City, state, and ZIP code 1902 Clover Avenue City, State, Zip of County Extension 4-H Office Anytown, WA 41902 7 List account number(s) here (optional) Part I Taxpayer Identification Number (TIN) Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid backup withholding. For individuals, this is generally your social security number (SSN). However, for a resident alien, sole proprietor, or disregarded entity, see the Part I instructions on page 3. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN on page 3. Note. If the account is in more than one name, see the instructions for line 1 and the chart on page 4 for guidelines on whose number to enter. Social security number or Employer identification number x x x x x x x x x Part II Certification Under penalties of perjury, I certify that: 1. The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me); and 2. I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding; and 3. I am a U.S. citizen or other U.S. person (defined below); and 4. The FATCA code(s) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct. Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions on page 3. Sign Here Signature of U.S. person General Instructions Section references are to the Internal Revenue Code unless otherwise noted. Future developments. Information about developments affecting Form W-9 (such as legislation enacted after we release it) is at www.irs.gov/fw9. Purpose of Form An individual or entity (Form W-9 requester) who is required to file an information return with the IRS must obtain your correct taxpayer identification number (TIN) which may be your social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN), to report on an information return the amount paid to you, or other amount reportable on an information return. Examples of information returns include, but are not limited to, the following: Form 1099-INT (interest earned or paid) Form 1099-DIV (dividends, including those from stocks or mutual funds) Form 1099-MISC (various types of income, prizes, awards, or gross proceeds) Form 1099-B (stock or mutual fund sales and certain other transactions by brokers) Form 1099-S (proceeds from real estate transactions) Form 1099-K (merchant card and third party network transactions) Date Form 1098 (home mortgage interest), 1098-E (student loan interest), 1098-T (tuition) Form 1099-C (canceled debt) Form 1099-A (acquisition or abandonment of secured property) Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN. If you do not return Form W-9 to the requester with a TIN, you might be subject to backup withholding. See What is backup withholding? on page 2. By signing the filled-out form, you: 1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued), 2. Certify that you are not subject to backup withholding, or 3. Claim exemption from backup withholding if you are a U.S. exempt payee. If applicable, you are also certifying that as a U.S. person, your allocable share of any partnership income from a U.S. trade or business is not subject to the withholding tax on foreign partners' share of effectively connected income, and 4. Certify that FATCA code(s) entered on this form (if any) indicating that you are exempt from the FATCA reporting, is correct. See What is FATCA reporting? on page 2 for further information. Cat. No. 10231X Form W-9 (Rev. 12-2014) 20
Closing a Club Checklist Final business meeting Motion to disburse funds Motion to distribute physical assets Motion to close the club Copy of minutes, signed by officer Statement of termination, signed by officer Officer list with phone numbers Submit to Extension 4-H Office 21
Closing a 4-H Club A 4-H club is a legal entity and has been given tax-exempt status by the IRS. As a result, closing a club must follow a specific process. At times, a club may have their EIN revoked for a variety of reasons. If your number has been revoked, you must legally close your club and transfer your assets to another entity that possesses tax- exempt status. To close your club, the club needs to make a series of decisions during the final business meeting: First, the club needs to determine how to distribute existing funds through a motion. This motion should include the name and EIN of the entity receiving the funds. Options for disbursement include 4-H Council, 4-H Foundation, WSU Foundation/County 4-H Excellence Fund or other 501(c)(3) organization. EACH COUNTY WILL DECIDE HOW ASSETS WILL BE DISBURSED. The motion should also include the final vote. Example: A motion was made by Susie 4-Her to distribute $1,258.32 to the WSU Foundation/Snohomish County 4-H Excellence Fund (EIN xxxxxxxxx). The motion was seconded by Joe 4-Her; the motion passed by a vote of 5-2. Next, the club needs to determine how to distribute existing assets. All remaining physical assets are to be distributed to any of the organizations listed above. Examples of physical assets include stall decorations, tack boxes, curtains, clippers, stands and any other supplies or equipment the club owns. This motion should include the name and EIN of the entity receiving the assets. The motion should also include the final vote. Example: A motion was made by Clover 4-Her to distribute all stall decorations to the Mighty Four Leaf 4-H Club (EIN: xx-xxxxxxx) and all livestock grooming equipment to the Big Cow 4-H Club (EIN: xx-xxxxxxx). The motion was seconded by Lucky 4-Her; the motion passed by a vote of 7-0. Finally, the club needs to make a motion to close the club. The minutes should reflect the motion and indicate the final vote. Example: A motion was made by Joe 4-Her to close the club for further operations. The motion was seconded by Clover 4-Her; the motion passed by a vote of 7-0. Additionally, the club must complete and submit paperwork indicating the club has closed to the IRS. The club will complete the items below and submit to the Extension 4-H Office: 22
A copy of the minutes of the final meeting, signed by an officer of the club (preferably the secretary.) A statement of termination written and signed by an officer, indicating the assets will be disbursed and the club will be closed. Example: The Best 4-H Club has terminated its operation as of September 30, 2016. Please find enclosed organizational minutes documenting the termination and a list of current officers with daytime phone numbers. Signed: Date: A list of the final officers and their daytime phone numbers. Example: OFFICER PHONE Mainly 4-Her, President 222-222-2222 Clover 4-Her, Vice-President 333-333-3333 Joe 4-Her, Secretary 444-444-4444 Susie 4-Her, Treasurer 555-555-5555 23
How to File a 990-N Go to irs.gov, search for Efile 990-N, Click Form 990-N (epostcard). Set up your profile as follows: After you click Send Code, you will receive a code from the IRS in your email Inbox. Click SEND CODE > Click CONTINUE > 24
The next page will require you to choose a username and password. Also, you need to choose 4 security questions. Write these down so that you don t forget them. 25
Click CONTINUE > If you complete the above appropriately, you will receive the following message: Click CONTINUE > 26
This is simply a notification for what you will see when you log on each time. Click CONTINUE > Your history could look like this. Click CONTINUE > 27
Once you log on and review your log on history, you will receive this page. Let s work with Managing your E-Postcard Profile first. Click MANAGE E-POSTCARD PROFILE PPPROFIL PROPROFIPROFILE On this page, select Preparer > Click CONTINUE > 28
Gather your list of EINs for your county. Enter an EIN where indicated and CLICK ADD EIN. Once you have completed adding all your EINs, you will only need to add an EIN when your county adds a new one. Once you ve added all your EINs, your screen will look similar to this. Click CREATE NEW FILING > 29
Highlight the EIN for which you are filing. Your screen will change to this. Click CONTINUE > 30
The date should pop up automatically for the EIN. Answer No to Has your organization terminated or gone out of business? and answer yes to Are your gross receipts normally $50,000 or less? If your gross receipts (this means all money deposited into your bank account) are over $50,000, you are required to file a Form 990-EZ; if your gross receipts are over $200,000, you are required to file a Form 990. You may not file a 990-N if receipts are over $50,000. The next fields Organization s legal name Line 1, Organization s legal name Line 2 and Employer Identification Number (EIN) should be populated (or filled in) for you. Click CONTINUE > 31
This page includes demographic information for the club. Complete the fields below Enter Additional DBA Names. Both addresses should be the office address for your county. If this doesn t work, use the address for the club leader associated with the club. If you have the club leader s name associated with the club, enter their name as Principal Officer. **Many counties have changed the contact name to the 4-H Faculty/Staff for that county. Click SUBMIT FILING > 32
This next page will show the documentation of your filing. Click < MANAGE FORM 990-SUBMISSIONS You will be sent back to the main page. Navigate to the last page of your numbers and you will find that your status is pending. 33
Check back frequently to see if the status has been updated. After about 7 minutes you should see the message change to "Get Updated Status". Click on "Get Updated Status" The status will change to either "Accepted" or "Rejected". If it has been accept, you are done. If it has been rejected, you will need to forward that rejection to the State 4-H Office. Navigate back to home and logout. 34
Instructions for Submitting Annual EIN Report Step 1: Step 2: Step 3: Step 4: Step 5: Step 6: Review the attached list against your list. If you have numbers that are not on this list (and have not been obtained in the past year), please look at instructions at the bottom of this page. Do not change names of Chapter Name or In Care Of unless you have already submitted an 8822B or sent a letter to the IRS. These have to be changed through either Form 8822B (for change in chapter name ) or a letter to the IRS (for In Care Of changes). If you have added any EINs during the past year, please insert their information below the area labeled Add If you have deleted any EINs due to club closing, or other reasons, please insert their information below the area labeled Delete Send your file (should be labeled county name EIN 2017 FINAL to Jana (ferrisj@wsu.edu) Relax, it s over for another year! Numbers not on your list: Step 1: Download the Master Business File from the IRS (go to irs.gov and search master business file in the upper right corner). You will be directed to the webpage that begins Exempt Organizations Business Master File. Step 2: Step 3: Step 4: Step 5: Scroll down the page until you see the map of the United States, click on Washington and a download will begin of the master file for Washington State. Open the excel file and use the search feature to look for the EIN that isn t on your page. Omit the hyphen in the number, use the name of the in care of to search, and the name of the club or group. If you find your number, please email that to Jana (ferrisj@wsu.edu) separately. If you cannot find your number, it means it has been revoked or dumped. It s time to apply for a new number. The instructions for obtaining a new number are attached. 3/14/17 35