Q & A

FREQUENTLY ASKED QUESTIONS (UPDATED 9/2020)

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 (Much of the information below can be found in other sections of this Website.)

WHAT IS THE SPECIAL PROJECTS FUND (SPF)?

The Special Projects Fund is a tax-exempt [501(c)(3)] non-profit corporation.  As such, it offers tax-deductibility to all donations made to support AAUW projects and scholarships through the AAUW CA Special Projects Fund.  SPF is registered with both the Us Internal Revenue Service and the California State Franchise Tax Board as a charitable trust.

SPF was established in 2001 for a 5-year provisional period and received final determination as a 503(c)(3) non-profit corporation in March of 2006.

WHY IS THERE A SPECIAL PROJECTS FUND?
The AAUW CA SPF was established as a “pass through” fund to receive and distribute tax deductible corporate and individual donations for approved AAUW CA state, branch, and inter-branch projects and scholarships that further education and equity for women and girls in AAUW California communities.

DOES SPF HAVE A STAFF?
SPF contracts with a bookkeeping service and a CPA firm for tax preparation and review.

HOW IS SPF GOVERNED?
SPF is governed by a Board of Directors representing a broad spectrum of both AAUW and professional expertise and geographical distribution.  Directors are appointed independent of the AAUW CA Board of Directors, as AAUW CA SPF is a separate corporation.  All directors are volunteers.  As a working board, directors log approximately 1,700 hours annually in volunteer hours.

WHO USES SPF?
Any AAUW CA project or scholarship that supports the AAUW mission and is administered by a branch, inter-branch council, or the state and wants to offer tax-deductibility to the donors may apply to use SPF as its pass through fiduciary agent.  SPF will accept donations only for approved projects and scholarships.  Currently, SPF serves 2 state projects and multiple branch projects and local scholarships.

HOW IS THE BOOKKEEPING HANDLED BY SPF FOR THE PROGRAMS AND PROJECTS USING SPF AS THEIR NON-PROFIT FIDUCIARY AGENT?
SPF does bookkeeping at the overall project level. Per all Agreements with ALL programs/projects/scholarships using SPF as their non-profit fiduciary agent, each project/program/scholarship is required to do their own day to day detailed bookkeeping.

For projects that have subsidiary entities, such as Tech Trek and the associated camps, the overall project entity is required to do the detailed bookkeeping for each subsidiary of the project (e.g. for Tech Trek this means each camp and branch associated with each camp).

HOW ARE THE FUNDS ACCOUNTED FOR BY SPF FOR EACH PROJECT/PROGRAM/SCHOLARSHIP USING THE SPF?

SPF provides a monthly financial report to all projects/programs/scholarships with revenues on deposit of $10K or greater.  Projects/programs/scholarships with revenues less than $10K receive a quarterly financial report.  It is the responsibility of the treasurer of each project/program/scholarship to reconcile the report on a monthly/quarterly basis and if there are any discrepancies work with the SPF Treasurer to resolve the issues. 

SPF is the steward of the funds held for the projects/programs/scholarships.  The funds are held in multiple accounts to include checking, savings, and moderate risk investment accounts.  The SPF Finance and Investment Committee regularly reviews the accounts for best business and banking/investmentpractices. 

SPF contracts with an independent bookkeeping service for professional bookkeeping services.  All SPF finances are reviewed annually by an independent CPS firm, which also does SPF’s annual tax filings.  Our most recent review, 2019, found SPF’s books to be in good order.

HOW ARE THE INTEREST AND DIVIDENDS EARNED AND ALLOCATED ON FUNDS HELD BY SPF?

Interest/dividends realized on any funds within SPF are distributed to the program/project/scholarship based upon the performance of the SPF investment accounts and SPF’s policies for interest/dividends realized.  Many of the funds handled by SPF are in and out of the SPF fund within a 12 month period. Those funds on deposit for a current year are not with SPF long enough to qualify for interest/dividends.  Reserves held by SPF for programs/projects/scholarships are held in the investment account and will realize interest/dividend earnings at the overall project level based upon SPF policies. 

THE 2020 AAUW CA TECH TREK CAMPS WERE CANCELLED DUE TO THE COVID 19 PANDEMIC, HOW ARE THE FUNDS RAISED FOR THOSE CAMPS BEING HANDLED BY SPF?

The SPF Board of Directors passed a motion early in 2020 with regard to the 2020 camp funds to allow those funds to be held in an isolated investment account until such time as they will be used by TT.  The interest accrued on those funds will be distributed to TT based upon SPF’s policies, which state that 80% goes to the program/project/scholarship and 20% is retained by SPF.  That interest due to TT will be distributed to the TT AAUW CA Project at the overall project level and it will then be the responsibility of the TT Coordinator and Financial Liaison to work with AAUW CA to determine how that interest realized will be distributed to the camp accounts.

CAN MONIES ON DEPOSIT FOR PROGRAMS/PROJECTS/SCHOLARSHIPS BE USED FOR OTHER PURPOSES?

SPF has addressed this question on multiple occasions.  Per IRS regulations, funds raised with a specific intent are restricted funds for the specific use they were raised for and cannot be re-directed for other uses.  The donors’ intents were to support the project/program/scholarship and a program/project/scholarship cannot arbitrarily make the decision to re-direct such funds for other purposes. 

HOW DOES SPF HELP WITH FUND RAISING?
Most major donors, both individuals and corporations, require tax-deductibility.  Using SPF provides that tax-deductibility.  Most corporations require the necessary documentation which SPF provides before they will consider funding a request.  SPF acknowledges all donations of $250 or more.  It is the responsibility of projects and scholarships to acknowledge donations of less than $250.

HOW DOES A PROJECT OR SCHOLARSHIP APPLY?
Projects and scholarships wishing to use SPF must submit a detailed application to the AAUW CA SPF Board of Directors for review and acceptance.  Applications are evaluated based upon the relevancy of the project or scholarship to the support of AAUW’s mission and the financial viability of the applicant.  All projects and scholarships must have a minimum annual budget of $1,000 and the applicant must exhibit the ability to sustain the project/scholarship.

WHAT SERVICES DOES SPF PROVIDE TO ITS USERS?
SPF is responsible for:

  • Depositing and tracking all tax-deductible donations.
  • Paying all voucher expenses of the project and scholarships.
  • Professional bookkeeping services.
  • Audit and tax preparation services.
  • Issuing tax letters to donors of $250 or more.
  • 1099 miscellaneous income tax reporting

HOW ARE THE SERVICES FUNDED?
SPF charges an administrative fee, currently 5%, on all deposits made by the project or scholarship with the fee taken at the time of deposit.  This fee is minimal compared to other non-profits, which charge an average of 18-22% assessed annually.

  • 30% of the SPF Fees are used for professional ausdit and tax preparation services.
  • 39% is used for professional bookkeeping services.
  • 26% is used for administrative expenses.
  • 6% is used for miscellaneous operating expenses such as postage, phone, post office box rental, and software upgrades.

WHY IS THE SPF FISCAL YEAR DIFFERENT FROM THAT OF AAUW CALIFORNIA?
The SPF fiscal year runs from January 2 to December 31, while the AAUW CA fiscal year, like that of AAUW runs from July 1 to June 30.  A calendar fiscal year allows for improved facilitation of our accounting process during peak activity periods related to projects that occur from March through August.

HOW IS A 501(c)(3) DIFFERENT FROM A 501(c)(4)?
A 501(c)(3) corporation is exempt from federal income tax if its activities have the following purposes:  charitable, religious, educational, scientific, literary, testing for public safety, fostering amateur sports competition, or preventing cruelty to children or animals.  All contributions to a 501(c)(3) are tax-deductible.

A 501(c)(4) is a nonprofit membership association, and contributions are not tax-deductible.

AAUW CA Special Projects Fund is a 501(c)(3) tax deductible corporation recognized by appropriate agencies of the federal and state governments.  Most branches fall within the  501(c)(4) category.

WHAT IS THE VOUCHER PAYMENT PROCESS?
The process for payment of vouchers for SPF projects other than Tech Trek is as follows:

  • Voucher is approved by committee chair and sent to second signer.
  • Second signer emails or mails voucher to SPF Finance.
  • The bookkeeper produces the check for payment and mails to SPF treasurer.
  • The treasurer signs the check and mails to payee.
  • Note: If a check is $5000 or more, the check is signed by the treasurer and mailed to either the SPF chair or assistant treasurer for a second signature.
  • The signer of the check then mails it to the payee.

This process may take up to 3 weeks.

The process for payment of Tech Trek vouchers is as follows:

  • The voucher is submitted to the camp treasurer for approval.
  • The voucher is sent to Tech Trek Project coordinator for second signature.
  • Project coordinator emails voucher to SPF Finance.
  • Bookkeeper produces check for payment and mails to SPF treasurer.
  • The treasurer signs the check and mails to payee.
  • Note: If a check is $5000 or more, the check is signed by the treasurer and mailed to either the SPF chair or assistant treasurer for a second signature.
  • The signer of the check then mails it to the payee.

This process may take up to 3 weeks.

HOW DO I MAKE A RMD DONATION?

AAUW members and others who are planning to make a RMD (Required Minimum Distribution) from their non-Roth IRA to SPF as a 501(c)3 entity should plan on having their distribution checks mailed to AAUW CA SPF no later than December 1, 2019.  The IRS requires that RMD checks be cashed within the fiscal year they are issued.  Receipt by SPF of these checks by the first week of December will enable SPF to make the deposit before the end of the year.

To facilitate the proper credit of RMD checks to SPF we recommend that members have their financial institution issue the check(s) in the name of AAUW CA SPF, but have them sent to the member for forwarding to SPF.  The AAUW member should then enclose a note designating the project to which the monies are to be credited.  If you are designating the monies to Tech Trek, it is also imperative that you indicate the camp and branch to be credited for the donation.