When were California PTA councils and districts treated as consumers of the property they sold?

Plain-English summary

The California PTA's legislative advocate supplied materials about the organization, purposes, and policies of the California PTA and its local units, councils, and districts. Those materials are not included in the published PDF.

From those materials, Tax Counsel Philip R. Dougherty concluded that a PTA council or district directly authorized by the governing authority to operate within one or more schools was consumer of the tangible personal property it sold under section 6370, like an authorized local PTA unit.

The authorization condition cut both ways. A council or district that had not obtained direct authority to operate within any school was not consumer of the tangible personal property it regularly sold.

The live annotation also conditions consumer status on using profits exclusively to further organizational purposes. The supporting opinion cites section 6370 but does not quote that profit-use condition.

Counsel said he would recommend adding the decision's substance to the Business Taxes Law Guide and circulating it to district offices. The source does not document whether either recommendation was carried out.

Source and live-annotation limits

The official PDF does not include a dated request, the supplied California PTA organization, purpose, or policy materials, local-unit or subdivision records, any council or district identity or governing document, direct school authorization, school or governing-authority records, property, sellers or buyers, invoices, regular sales, fundraising records, profit-use evidence, returns, exemption documentation, tax calculations or payments, Business Taxes Law Guide revision, district-office circulation, audit, assessment, claim, appeal, or later outcome. The advocate, councils, districts, local units, schools, governing authorities, property, transactions, quantities, prices, profits, and tax amounts are redacted, unidentified, or undocumented.

The live annotation uses specifically authorized while the supporting opinion uses directly authorized. It also adds the exclusive-profit-use condition. The live annotation preserves councils and districts, one-or-more-school authorization, school governing authority, consumer status, date, and property-sales scope. It omits the requester and counsel, supplied California PTA materials and local-unit comparison, express consequence for bodies without direct authorization, regular-sale wording, section 6370 citation, Business Taxes Law Guide and district-office recommendations, missing records, redaction, and absent implementation and outcome.

What this means for you

PTA councils, districts, schools, and tax professionals

Preserve organizational purpose and policy materials, council or district governing records, written direct authorization from each school's governing authority, local-unit relationships, every property sale, invoices, exclusive profit use, returns, exemption documents, tax calculations, and payments. A name or relationship within the PTA structure does not substitute for direct school authorization.

Common questions

Did every PTA council or district qualify?

No.

What was required?

Direct authorization to operate within at least one school from that school's governing authority.

How was an authorized organization treated?

As the consumer of the tangible personal property it sold under section 6370.

Did the opinion identify a particular qualifying council or district?

No.

What happened without direct school authorization?

The council or district was not regarded as consumer of property it regularly sold.

Where does the exclusive-profit-use condition appear?

On the current live annotation; the supporting opinion cites section 6370 but does not quote that condition.

Did the source confirm the planned Law Guide update or district circulation?

No.

Citations and references

• California Revenue and Taxation Code § 6370
• Requester-supplied California PTA organization, purpose, and policy materials; direct authorizations, council and district records, property sales, profit-use and tax records; and outcome — described or implicated but not documented

Verbatim support

From the official Tax Counsel opinion:

From those materials we are convinced that those PTA Councils and PTA Districts which in fact have been directly authorized to operate within one or more schools by the governing authority of the school(s) must also be consumers of the tangible personal property they sell, as are authorized PTA local units, pursuant to Revenue and Taxation Code Section 6370.

Please note that those PTA Councils and PTA Districts which have not obtained direct authorization to operate in any school will not be regarded as consumers of the tangible personal property they regularly sell.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/390-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/390-0100.pdf

Original ruling text

390.0100

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION
1020 N STREET, SACRAMENTO, CALIFORNIA
(P.O. BOX 942879, SACRAMENTO, CALIFORNIA 94279-0001)
916/ 445-2705

April 27, 1979
Mrs. E--- S--Legislative Advocate
California PTA
XXXX T-----, CA XXXXX

SR -- XX-XXXXXX

Dear Mrs. S---:
Thank you for the materials you have supplied on the organization, purposes, and policies of the California PTA and its subdivisions, the local PTA units, PTA Councils, and PTA Districts. From those materials we are convinced that those PTA Councils and PTA Districts which in fact have been directly authorized to operate within one or more schools by the governing authority of the school(s) must also be consumers of the tangible personal property they sell, as are authorized PTA local units, pursuant to Revenue and Taxation Code Section 6370. Please note that those PTA Councils and PTA Districts which have not obtained direct authorization to operate in any school will not be regarded as consumers of the tangible personal property they regularly sell. I will recommend that the substance of this decision be included in the material of the Business Taxes Law Guide and also be circulated to our district offices. Very truly yours,

Philip R. Dougherty
Tax Counsel

PRD:ba