Unit Financial Guidelines
Read the following FAQs for help setting up and running the finances of your unit. It is important to follow all of the guidelines so we are always being tax compliant.
- Follow this link to read all you need to know about taking care of the finances of your unit. Including answering questions like: How much money do we need? How are we going to get money? Where do we put our money once we’ve earned it?
Getting an EIN (Employer Identification Number) for your Unit
- Charter Organization Units: Contact your charter organization for permission to use their EIN and direction on who to use as the responsible party. In the alternative, our council allows units to deposit funds in custodial accounts at the Fickett Center.
- Council Registered Units: Contact us for permission to use our EIN and direction on who to use as the responsible party. Council Registered Units previously using separate bank accounts through a Charter Organization should close those accounts and follow the local council policies for a new account. Council registered units should not use custodial accounts.
- More Instructions for getting an EIN
Getting a Checking Account for your Unit
- We encourage you to contact the A+ Federal Credit Union branch near you if your unit needs to open a new unit account or would like to move its existing unit account. (Our partnership with A+ Federal Credit Union gives credit union membership to all Scouts, Scouters, their families, and units.) To open a unit checking account at A+FCU, you’ll need:
- EIN (Tax ID) certificate from the IRS
- Minutes from a unit committee meeting stating the officers of your unit and which ones are authorized to sign on the account
- Valid Social Security Number for each authorized signer
- Valid ID for each authorized signer
- Should our unit have a checking account?
Yes, unit funds should be deposited in a checking account that requires two signatures. Typically the Treasurer and a member of the Unit Committee. The unit leader could be one of the signees but it is recommended it be a committee person. It could be that the unit leaders have a petty cash fund (the limit set by the committee), which is accounted for with receipts each month.
- Does a unit need its own tax identification number? If so, where do we get it?
All units need a tax ID number (also referred to as an “EIN” – Employer Identification Number). Units should NOT use the Social Security number of an adult leader. If they do, the IRS will attribute all banking transactions, unit purchases, etc. to that leader as an individual. Units may use the tax ID number of their chartering organization, if given permission.
So the answer depends how the unit is chartered. Most charter registered units obtain their own tax ID number by completing IRS Form SS-4, which now requires the designation of a responsible party. (www.irs.gov) Contact your chartered organization for permission and direction on who to use as the responsible party. For most Scouting units, the Committee Chair is an appropriate responsible party. For council registered units, contact your council for instructions.
- Who is responsible for the finances of the unit?
The unit committee is responsible, but the assets belong to either the chartered organization or to the council depending on how the unit is chartered.
- Should our unit consider insuring our unit equipment?
Yes, the chartered organization or the council owns the assets. It is recommended that annually an inventory be given to the chartered partner of the unit’s equipment.
- Can our unit deposit funds with the local council?
Yes, most councils allow units to deposit funds to their credit in the council service center.
- What happens to the unit funds and equipment should the unit dissolve?
The unit committee shall apply unit funds and property to the payment of unit obligations and shall turn over the surplus, if any, to the chartered organization or to the council.
- When should our unit submit a BSA Unit Money-Earning Application?
For all unit fund raising. Approval must be given by the chartered organization and the council.
- Is our unit considered tax-exempt by the IRS?
Chartered organizations vary widely, but the tax status of your unit is usually the same as that of your chartered organization if the chartered organization includes the unit in its tax-status. For council registered units, contact your council for more information.
- Can our unit be covered under the BSA’s group exemption?
No. The IRS only allows local councils (and council trust funds) to be included under the BSA.
- Can our unit be exempt from state sales taxes?
Check with your own state as this varies widely across the country.
- A volunteer suggested that our unit apply for its own tax-exempt status. Can we?
No, units should not incorporate or apply for their own tax-exempt status. Units are not legal entities.
- We can’t solicit gifts for our unit?
No, units are not permitted to solicit any gifts.
- Does that mean people can’t make gifts to our unit?
Anyone can contribute, but the donor would not receive a charitable deduction.
- Can my unit credit amounts from fundraising to an individual toward their expenses?
Expenses must be reasonable and related to Scouting for youth to “earn their own way.”
Revised: May 2021 BSA Legal Department – This is not tax or legal advice.