I’m filling out the CSS profile for an EA school. I just remembered that we have an extra $2,000 in one of our personal checking accounts because I’m the treasurer for a club this year.
Ack! What should we do? It doesn’t belong to us and the funds will be dispersed throughout the spring, but right now the money looks like it belongs to us.
Get the club funds put in a club account before you complete that Profile.
To be honest…the club finds don’t belong in your personal account anyway.
Agreed; you shouldn’t be mixing funds this way. It’s a bad idea for a number of reasons having nothing to do with college financial aid. But for FA: the club money does not belong to you, so don’t report it as an asset. It’s very unlikely that you will be asked for copies of bank statements to substantiate the numbers that you provide, but if you are, just provide a truthful explanation.
The club funds shouldn’t be in a personal account to start with.
Thanks for the feedback, everyone. I am going to talk to the other parents and see how they want to handle it.
I was running out the door so I didn’t have time to clarify. These funds are for a short term need (to be used within the next 6 months), so we didn’t want to open a separate account. It’s in an account I don’t use and had less than $20 balance to begin with, so there is no co-mingling of personal funds (other than that $20). Also, there is a checks and balances system in place, so there is accountability for any outgoing funds.
It still is wrong to coming personal fun with those of a club or charity. If you were garnished the money would be taken. Same for your money if club was. Don’t collect the money early if you don’t have a bank account for that club. Honestly, you’d be better off keeping it in a shoebox under your bed.
If this is a school club, I’m sure this is against the administrative rules. It wouldn’t be allowed for girl scouts or any 501c3 organization either.
No, this is not a school club nor a non-profit. And it’s not even a club, but an event among friends. I just didn’t know what to call it. Sorry, I shouldn’t have posted this question in a forum where I might be misunderstood.
What did you think the answer would be?
I think you have to report it in your name if it is in an account with your SSN on it.
Take the money out and give it to someone else who can be trusted to hold it for your group.
I don’t think you were mis-understood. Everyone quite understands that group funds (whatever group) should never be placed in a personal bank account. There are many reasons for it. College funding is just one small example. It would be far easier on everyone in your “club” to just open a club account, even if you think the money will be temporarily. That way, the club has a place for its, well, own money.
While M2CK has a solution and maybe that’s the one you wanted to hear, it just passes the problem to someone else.
If you run the NPC you may find that $2000 in a parental account makes little or no difference
OP- there’s a good lesson here. It’s easy to pull out the wrong checkbook (just look at the trouble Marco Rubio is in right now for using the wrong credit card) and then have your friends/colleagues upset with your momentary lapse even if you pay the money back immediately, and even if no harm was intended or done.
With paypal and all the other online payment systems, you likely don’t even need a bank to pay for group activities or events any more.
So get yourself out of the banking business.
If this is a group of “friends” who have raised money for something…I would suggest that one of the other “friends” put the money in THEIR account.
As it stands now, this money is YOURS. It doesn’t belong to a non-profit or an authorized club of some sort. It’s money a small group has decided to use for whatever. Basically, it’s yours. No real evidence that a “club” or other organization actually even exists.
Truthfully, you should open an account in the name of the “made up club” with two cosigners. I don’t think it’s that hard to do. You would need a taxpayer ID number for your “club”.
Until you get this, the money is yours, and must be declared on the FAFSA if it is in your account, in your name the day you file your FAFSA.
Not true. I’ve seen other posts, thumper, where you tell a student that simply putting their money in a parent’s account doesn’t automatically make the money belong to the parent. Same concept here. Just because OP’s is the only name on the account does not mean that all the funds in the account are necessarily hers. OP has control of the funds, but not the authority to spend it all as she pleases, just as if a friend asked you to hold some personal property for safekeeping. You would have control, but not the authority to dispose of the property as you please.
But, comingling the funds is still a really bad idea.
If the bank failed, the FDIC payout would be to the OP. If the OP died, the money would only be paid to her estate. Another club member could not get those funds, they belong to the OP. She has an obligation to pay the money to or for the benefit of the other members, but that is no different than owing a friend $500 - you don’t get to claim that on your CSS.
If she doesn’t want to claim it on the CSS, then she needs to take the chance that she’ll have to prove it isn’t hers if questioned. Do I think most people declare every single cent they have on the day they file? No, I don’t think most people include their collection of US State quarters, the coins on their dressers, the money in their wallets. Do I think schools have time to investigate? No, there is no way for them to find an account at a bank in your name unless there is quite a bit of interest generated and a 1099 is generated.
Oh, it’s very different than owing a debt. A debt is paid out of your own funds, and until the debt is paid, the funds belong to the debtor. That’s not the case here- these funds don’t belong to the OP, even though she has them in her bank account.
I think we can all agree that FAFSA requires a parent to report personal cash in a home safe just as one is required to report funds in a personal savings or checking account. Let’s say a Girl Scout leader has just collected cookie money from the girls in her troop. They had a good cookie season, so it’s several thousand dollars. The leader puts the cash in an envelope in her home safe, next to an envelope containing some cash of her own. Between the time she collects this cookie money and when she turns it over to the regional cookie person, she completes and files FAFSA. Is she required to report as an asset the cookie money that she has collected and that is sitting in her home safe?
No because the money for the cookies is never hers. There are records that show it belongs to the troop. She hasn’t placed it in her account under her ssn or her name, she hasn’t taken ownership, she is a bailer. Once the money is in a personal account, by law it is presumedto be her money and not protected from her creditors. An attorney puts held money in a trust account and different rules apply to that trust account. What if it wasn’t $2000 but $200,000 she was holding? Same situation, not her money, right? Under banking laws, the name on the account is the owner. CSSSAYS to report all cash assets you own.
If the OP feels justified in not reporting it, then don’t report it. It is unlikely to ever be discovered. However the question was is it supposed to be reported. Yes,cash in all accounts is supposed to be reported
So if the club has records for the money that OP deposited in her account, then in your opinion it doesn’t need to be reported on OP’s FAFSA? Or if she had simply held the club’s money as cash in her dresser drawer, where it wasn’t “under her SSN or her name,” it wouldn’t need to be reported on OP’s FAFSA? If the law makes the presumption that funds in OP’s personal account are owned by her (maybe you could cite the statute), then certainly it’s a rebuttable presumption, and probably in this case easily rebuttable. Attorney trust accounts are usually established under law or bar regulation, and for all the good reasons that OP should not have deposited club funds in her personal bank account.
Using this logic, stolen funds placed in a bank account become the legal property of the account owner.
I agree, but OP doesn’t “own” the club funds in her bank account, any more than the Girl Scout leader “owns” the cookie money in her safe.
The 2015-2016 FAFSA question 90 asks about parents’ current value of cash, checking and savings accounts. The publication Completing the FAFSA 2015-2016 provides guidance on completing questions 90-92:
“Part ownership of asset. If your parents own an asset with others and therefore only own a portion or percentage of the asset, they should report the net asset value that represents only their share of the asset owned. They would determine the current market value of the asset, reduce the value by any outstanding debt, and then multiply the net asset value by their ownership percentage. This result is then reported on the FAFSA.”
The above language applies to bank accounts as well as other assets, and contemplates that all the funds in a specific account may not belong to the account owner who is filing FAFSA, or, conversely, that a FAFSA filer may have funds in a bank account that is not under their name.
OK. I think the OP has the idea. It’s not a good idea to mix funds when financial aid time comes.