How to start a booster club: a step-by-step guide

Last updated 2026-07-24

what is a booster club, exactly?

A booster club is a group of parents, alumni, or community members who raise money and provide support for a school program, usually athletics, band, choir, or robotics. It's not part of the school district legally, even though everyone treats it like it is. The school can't (and shouldn't) hold your money or sign your contracts. Most booster clubs are separate nonprofit corporations with their own EIN, their own bank account, and their own board. That separation matters. If your booster club isn't its own legal entity, the people running it are personally on the hook for its debts and liabilities. A parent who signs a hotel contract for a team trip as "just the booster club" with no legal entity behind it can end up personally liable if things go sideways. School districts almost universally require booster clubs to be independent, incorporated, and (usually) tax-exempt before they'll let the club fundraise on campus, sell concessions, or use the school's name. Check with your district's business office early; some have a specific booster club policy or MOU template you're expected to sign.

what does a treasurer do in a booster club?

The treasurer is the person who keeps the books, controls the bank account, and makes sure the club doesn't accidentally break IRS or state law. In a small club this is the single most important volunteer job, more important than president, because bad money management is what actually gets clubs shut down or investigated. Day to day, a booster club treasurer does roughly this: deposits fundraiser proceeds within a day or two (never sits on cash), reconciles the bank statement every month against a ledger, tracks income and expenses by program or team, prepares a budget-to-actual report for board meetings, and files the annual IRS return (Form 990-N, 990-EZ, or 990 depending on revenue). They also keep receipts, W-9s for anyone paid over $600, and documentation for any raffle or gaming license. What does a treasurer do that a president doesn't? The president runs meetings and represents the club publicly. The treasurer is the one who can tell you, on demand, exactly how much money the club has, where it came from, and whether it's legally allowed to be spent that way. If your club can't answer "how much cash do we have right now and can you prove it" within five minutes, the treasurer role isn't being done, whoever holds the title. A good habit: two signers required on every check or transfer over a set dollar amount (many clubs use $250 or $500 as the line), and the treasurer is never the sole person with bank login access. One person with total, unsupervised control of the account is how embezzlement happens in small nonprofits, and it happens more often than people think. The Association of Certified Fraud Examiners' 2024 Report to the Nations found that organizations with fewer than 100 employees suffer a median fraud loss disproportionate to their size, and that lack of separation of duties is one of the most common internal control weaknesses behind those cases ^[1].

step 1: decide on a legal structure

Most booster clubs incorporate as a nonprofit corporation in their state before doing anything else. This is a state-law filing, separate from federal tax-exempt status, and it's what gives your board members liability protection. You'll typically file Articles of Incorporation with your Secretary of State, pick a registered agent, and pay a filing fee that's usually somewhere between $25 and $125 depending on the state. Check your specific state's fee; it changes and varies a lot (some states charge under $50, others more). A few clubs skip incorporation and run as an unincorporated association instead. It's cheaper and faster, but the board members personally carry more legal exposure, and many school districts and banks won't work with an unincorporated group at all. If your club will handle real money (most do), incorporate.

step 2: get an EIN from the IRS

Every booster club needs its own Employer Identification Number (EIN), even with zero employees. You cannot open a bank account, apply for tax-exempt status, or file a 990 without one. Apply directly on IRS.gov using the online EIN application; it's free and the IRS issues the number immediately if you apply online during business hours ^[2]. Never pay a third-party site to "get you an EIN," some charge $50-$200 for something the IRS gives away for free. Do not use a founder's or a school employee's Social Security Number as the club's tax ID, even temporarily. It muddies who legally owns the money and creates a mess later when leadership turns over.

step 3: apply for 501(c)(3) tax-exempt status (if you want it)

501(c)(3) status is what lets donors deduct their gifts and often what lets you skip sales tax on purchases in your state. Most booster clubs pursue it, but it's not automatically required to exist or fundraise. Small organizations, generally those expecting $50,000 or less in annual gross receipts, can often use Form 1023-EZ, a streamlined online application. As of the IRS's current fee schedule, the user fee is $275 for Form 1023-EZ ^[3]. Larger or more complex organizations use the full Form 1023, which has a $600 user fee ^[3]. Processing time varies widely, sometimes a few months, sometimes closer to a year depending on IRS backlog, and there's no guarantee of approval; confirm current fees and timelines directly with the IRS before you file. Until your exemption is approved, technically the organization is not tax-exempt yet, though the IRS generally treats it as exempt retroactive to the incorporation date if you apply within 27 months of formation ^[4]. Confirm this timing rule with the IRS or a qualified preparer, since exceptions and deadlines get technical fast. Some booster clubs choose to operate under a school's or district's own tax-exempt umbrella instead of getting their own 501(c)(3). This can work, but it means the district's finance office controls the money, which most independent booster clubs don't want. Ask your district which model they require before you file anything.

step 4: open a dedicated bank account with real controls

Once you have your EIN (and ideally your state incorporation paperwork), open a checking account in the organization's legal name, not a personal account, not a coach's account, not "cash in a shoebox in the equipment room." Require two signers on the account and on any check or electronic transfer above a threshold your board sets. Never let one person both approve and execute a payment alone; that single change closes off the most common fraud path in small nonprofits, per the ACFE's finding that lack of separation of duties is one of the top control weaknesses in fraud cases at small organizations ^[1]. Get a debit card only if you can also enforce a receipt-and-approval rule for every swipe. A card with no receipt trail is how "team snacks" quietly becomes personal groceries. Open a separate savings sub-account or use accounting categories to track restricted funds (say, money raised specifically for a senior trip) separately from general operating funds. Commingling restricted and unrestricted money is a common mess that a new treasurer inherits and has to untangle.

step 5: write bylaws and a conflict-of-interest policy

Bylaws are the rulebook: how the board is elected, how often you meet, what a quorum is, how money gets approved, and how the club dissolves if it ever shuts down. The IRS asks about a conflict-of-interest policy directly on Form 1023, so most clubs adopt one even if they use the EZ version. Keep bylaws short and specific. A ten-page legal document nobody reads is worse than a two-page document the whole board actually follows. Cover: board size and terms, officer duties (this is where you spell out what the treasurer of a club does day to day), how funds get approved, and what happens to remaining assets if the club dissolves. IRS rules require 501(c)(3) organizations to dedicate remaining assets to another exempt purpose on dissolution, not distribute them to members ^[4].

what is form 990, and does our new club have to file it?

$50,000 or less	Form 990-N (e-Postcard)
Less than $200,000, and assets under $500,000	Form 990-EZ (or full 990)
$200,000 or more, or assets $500,000+	Form 990 (full)	These thresholds come from the IRS's own guidance on annual filing requirements [6]; confirm current figures directly on IRS.gov since thresholds have been adjusted before and could change again. Most small booster clubs, especially in their first few years, land comfortably under $50,000 and file the 990-N, sometimes called the form 990-n e-Postcard. It's an 8-question online form, no financial detail required, and it takes about ten minutes.

Form 990 is the annual information return the IRS requires from most tax-exempt organizations. It's not an income tax return in the traditional sense (exempt organizations generally don't owe federal income tax on mission-related revenue), but it's how the IRS and the public see your revenue, expenses, and governance. What is the 990 tax form used for practically? Donors, grantmakers, and district administrators check it (or its simpler version) to confirm a booster club is legit and in good standing. GuideStar/Candid and the IRS's own Tax Exempt Organization Search both publish 990 data publicly ^[5]. Which version you file depends on gross receipts: | Annual gross receipts | Form required |

what happens if we forget to file the 990-N?

This is the single most common way booster clubs lose their tax-exempt status, and it's almost always an accident, not fraud. The IRS automatically revokes exempt status for any organization that fails to file its required ^[990](/articles/treasurer-basics/990), 990-EZ, or 990-N for three consecutive years ^[7]. Auto-revocation isn't a warning letter you can argue with after the fact; it's automatic under Internal Revenue Code Section 6033(j). The IRS states plainly: "Organizations that do not file for three consecutive years automatically lose their tax-exempt status" and that "the revocation is effective on the original filing due date of the third year" ^[7]. Once revoked, the club is treated as a taxable entity, donations are no longer automatically tax-deductible, and getting reinstated means refiling for exemption (often the full Form 1023, with the user fee again) plus, in many cases, filing back returns. The IRS does offer streamlined retroactive reinstatement for small organizations that missed filings but apply within 15 months of the revocation notice, if certain conditions are met; confirm current eligibility rules on IRS.gov before assuming you qualify . The fix is boring but it works: put the filing deadline on a recurring calendar reminder tied to your fiscal year end (the 990-series is due by the 15th day of the 5th month after your fiscal year ends), and never let leadership turnover happen without the outgoing treasurer walking the incoming one through exactly what's been filed and what's due next.

do we need a raffle or gaming license?

If your booster club plans to run a raffle, 50/50, bingo night, or any game where players pay to win a prize, most states require a separate charitable gaming or raffle license before you sell a single ticket. This is completely separate from your IRS paperwork. Rules vary enormously by state: some require a small registration fee and a report of proceeds afterward, others cap prize values, restrict where tickets can be sold, or require the organization to have existed for a minimum period (commonly one to three years) before it can hold a raffle. Confirm the specific rules with your state's charity regulator or attorney general's office before you print a single ticket; a raffle run without the required license can expose the club to fines and, in some states, criminal penalties for illegal gambling. Always check your specific state's charitable gaming or raffle statute and licensing office directly. Rules change, and "the club down the road did it without a license" is not a defense.

do we need to register as a charity with the state, too?

Separately from the IRS, many states require nonprofits that solicit donations from the public to register with a state charity official, usually the Attorney General's office or Secretary of State, before fundraising. This is often called charitable solicitation registration, and it's distinct from both incorporation and IRS tax-exemption. Requirements and thresholds vary by state; some exempt very small organizations (often under a set annual revenue threshold) from registration, others don't. Confirm with your specific state's charity office whether your club needs to register, and note that many states require annual renewal, more than a one-time filing. If your club solicits donations online, some states apply their registration rules to any organization reaching their residents through a website or social media, regardless of where the club is physically located. This is a genuinely confusing area of law; when in doubt, call the state charity office directly rather than guessing.

how much does it actually cost to start a booster club?

State incorporation filing	roughly $25-$125 (varies by state)
EIN	$0 (IRS.gov, free) [2]
Form 1023-EZ user fee	$275 [3]
Form 1023 (full) user fee	$600 [3]
State charity registration	$0-$100+ (varies, some states exempt small orgs)
Raffle/gaming license	varies widely by state, often $0-$100 for small events
Bank account	usually free with a nonprofit checking product	A lean club that qualifies for the 1023-EZ and a cheap incorporation state can be legally set up for well under $500 total. A club that needs the full Form 1023 and operates in a pricier incorporation state might spend closer to $700-$900 before it's ever raised a dollar. This is roughly the gap a State-Personalized Treasurer Kit is built to close: a $99 one-time kit with your specific state's forms, deadlines, and templates pre-assembled, so a first-time treasurer isn't reverse-engineering incorporation and IRS paperwork from scratch. It's not a substitute for a lawyer or accountant, but it saves the hours of hunting down which form applies in which state.

Budget for real, out-of-pocket costs beyond your own time. Here's a realistic first-year range, though every number below should be confirmed against your specific state and the IRS's current fee schedule before you rely on it: | Item | Typical range |

what records should we keep from day one?

Start a permanent file (physical binder or shared cloud folder, doesn't matter which) the day you incorporate, and never let it live only on one departing volunteer's personal laptop. Keep, permanently: Articles of Incorporation, EIN confirmation letter, IRS determination letter (if you got 501(c)(3) status), bylaws and all amendments, board meeting minutes, and every Form 990 or 990-N confirmation you've filed. Keep for at least 3-7 years (check with your accountant on your state's specific requirement): bank statements, receipts, invoices, W-9s and 1099s for paid contractors, and raffle/gaming license paperwork with proceeds reports. The biggest single failure point in booster club recordkeeping isn't fraud, it's a leadership handoff where the outgoing treasurer just... doesn't hand anything off. Build a one-page handoff checklist now, before you need it, listing account logins, the EIN, filing deadlines, and where the permanent file lives.

what's the realistic timeline to get everything in place?

Plan on 2 to 6 months from "we decided to start a booster club" to "we're fully legal and can accept tax-deductible donations," and that's if nothing gets stuck in an IRS backlog. Roughly: state incorporation takes days to a few weeks depending on the state; the EIN is instant online ^[2]; a 1023-EZ application, if you qualify, is often decided within a couple of months, while the full Form 1023 can take considerably longer, sometimes six months to a year, depending on current IRS processing volume. There's no fixed guarantee on any of these timelines; the IRS updates processing time estimates periodically, so check IRS.gov for the current estimate before promising your board a date. Meanwhile, nothing stops the club from fundraising informally on day one; you just can't promise donors a tax deduction, and you can't run licensed gaming activities, until the relevant approvals are in place. Many clubs open the bank account and start collecting membership dues and small donations while the 501(c)(3) application is pending.

Frequently asked questions

what does a treasurer do?

A treasurer manages an organization's money: deposits and tracks income, pays approved expenses, reconciles bank statements monthly, prepares budget reports for the board, and files required tax returns like Form 990-N. In a booster club, the treasurer is usually the only person who can say exactly how much cash exists and where it came from at any given moment.

what is a treasurer?

A treasurer is the officer responsible for an organization's finances: cash handling, bookkeeping, banking, and financial reporting to the board and, where required, to the IRS and state regulators. It's an elected or appointed board position, not a paid job in most volunteer booster clubs.

what does a treasurer of a club do differently from other officers?

The president runs meetings and represents the club publicly; the treasurer controls and accounts for the money. The treasurer signs checks (with a second signer for larger amounts), reconciles accounts monthly, and files the annual IRS return, which is the one job that, if skipped for three years running, can cause automatic loss of tax-exempt status.

what is form 990?

Form 990 is the IRS's annual information return for tax-exempt organizations, reporting revenue, expenses, and governance. Depending on gross receipts, an organization files the full Form 990, the shorter Form 990-EZ, or the simple Form 990-N e-Postcard for organizations with $50,000 or less in annual gross receipts.

what is a 990 tax form used for?

It's used by the IRS to confirm a tax-exempt organization is still operating within its exempt purpose, and it's used publicly by donors, grantmakers, and school districts to verify a booster club's legitimacy and financial health. The data is searchable through the IRS's Tax Exempt Organization Search tool.

do we have to incorporate before we can fundraise?

No, but you should anyway. You can technically raise money as an unincorporated group, but board members carry personal liability, and most school districts and banks require formal incorporation before they'll recognize the club or let it use school facilities and branding.

how long does 501(c)(3) approval take for a new booster club?

It varies. Organizations using the streamlined Form 1023-EZ, generally those expecting $50,000 or less in annual gross receipts, often hear back within a couple of months. The full Form 1023 can take considerably longer, sometimes six months to a year depending on IRS backlog; check IRS.gov for current processing estimates.

what happens if our booster club misses three years of 990 filings?

The IRS automatically revokes tax-exempt status once an organization fails to file its required return for three consecutive years, per Internal Revenue Code Section 6033(j). Reinstatement generally requires refiling for exemption and, in many cases, submitting back returns; some small organizations qualify for streamlined retroactive reinstatement if they apply within 15 months of the revocation notice.

do we need a separate license to run a raffle?

In most states, yes. Charitable raffles, 50/50s, and bingo nights typically require a separate gaming or raffle license from a state agency, distinct from IRS tax-exempt status. Rules on fees, prize caps, and minimum years of existence vary widely by state, so confirm directly with your state's charitable gaming office before selling tickets.

can a school district hold our booster club's money for us instead?

Some districts offer this arrangement, where the club operates under the district's own tax status instead of getting its own EIN and 501(c)(3). It's legal in many places, but it means the district's finance office controls the funds and approval process, which most independent booster boards prefer to avoid.

how much does it cost to start a booster club?

A lean club can get legally set up for under $500: state incorporation (roughly $25-$125), a free IRS EIN, and the $275 Form 1023-EZ user fee if the club qualifies. Clubs needing the full $600 Form 1023, plus state charity registration or raffle licensing fees, should budget closer to $700-$900.

what records does a new treasurer need from the outgoing one?

At minimum: the EIN confirmation letter, IRS determination letter, bylaws, bank account access and statements, the last three years of filed 990/990-N confirmations, and any state charity or raffle license paperwork. Missing handoffs are the most common cause of accidental auto-revocation, not fraud.

is a booster club automatically tax-exempt because it supports a public school?

No. Supporting a public school program doesn't automatically make a booster club tax-exempt. It has to separately incorporate, get its own EIN, and apply for and receive 501(c)(3) status from the IRS before donations to it are tax-deductible.

Sources

1. Association of Certified Fraud Examiners, Occupational Fraud 2024: A Report to the Nations: Small organizations suffer disproportionately large fraud losses, largely due to lack of separation-of-duties controls
2. IRS, Apply for an Employer Identification Number (EIN) Online: EIN applications are free and issued immediately online during business hours
3. IRS, Instructions for Form 1023 (Rev. December 2017): Exemption can be recognized retroactive to formation date if applied for within 27 months; dissolution asset rules for 501(c)(3) organizations
4. IRS, Tax Exempt Organization Search: 990 data is publicly searchable to verify an organization's tax-exempt status
5. IRS, Form 990 Instructions (2023): Who Must File: Filing thresholds for Form 990-N, 990-EZ, and full Form 990 based on gross receipts and assets
6. IRS, Automatic Revocation of Exemption for Failure to File: Organizations that fail to file for three consecutive years automatically lose tax-exempt status, effective as of the third year's filing due date
7. IRS Revenue Procedure 2014-11 (streamlined retroactive reinstatement procedures): Small organizations may qualify for streamlined retroactive reinstatement if they apply within 15 months of revocation notice