Typically homeschool groups collect fees from their members in the form of family registration payments. These are used to cover operations costs such as rent for the facility they’re using, group insurance, supply costs, and more.
But if you’re just starting from scratch, how do you pay for these things when your organization has not yet collected funds?
Unfortunately, the founding board members (in my case it was me as the president & founder), will have to spend some money out of their own pockets to get the organization started. However – this is temporary and you will get your money back! Be sure to save your receipts, and if you begin collecting fees from families during your first fiscal year, the treasurer of your organization will be able to reimburse you. So the money is not gone forever, but it is unavoidable, unless you’re able to find money elsewhere in the form of donations (provided you have already incorporated as a non-profit organization), you will need to endure some of the initial start up costs until you’re able to be reimbursed.
You will need to consider the following costs when starting your organization:
- Initial organization incorporation fees with your state. This is important – make sure you are recognized as an entity in your state and get yourself a TIN (Tax Identification Number). You will need this documentation in order to open a bank account in your organization’s name. DO NOT EVER COLLECT FEES AND DEPOSIT IN YOUR PERSONAL BANK ACCOUNT. Doing this will risk exposing your personal assets and would be a mess for you. It is not a good idea at all.
- Any IRS non-profit 501c3 tax exempt fees (although, I recommend you hold of on this until your organization has been around for at least one school year). Not all organizations choose to go this route, and it may be unnecessary for some.
- Liability insurance (you will need this if you plan to meet officially with potential or enrolled members, even for group sponsored events off-site)
- Supply costs – however I encourage you to hold off on purchasing many supplies, and ask your members to donate general supplies to the cause such as pencils, pens, markers, glue sticks, etc. This helped us tremendously when we first started in order to keep registration fees low.
- Printing costs – take advantage of free printing at the library unless you’re able to share your host facility’s copy machine…until you can get your own printer. The bulk of the printing should happen after you collect fees, so any printing done before then should be minimal.
- I offer consultation services to help people start their homeschool organizations. I will provide you with an invoice so you can keep for your records and for reimbursements later. I’m also happy to help existing organizations and provide support.
There may be more unexpected expenses not listed above, but as I mentioned before save your receipts!
While it is not fun to have to pay for startup costs out of pocket, you will get quickly reimbursed once you start enrolling members. It is short-lived and you will be on your way to being able to use the organization’s funds in no time!
