Leadership Letter
November 2023
ASK COUNSELOR TARA
ASCE’s General Counsel Tara Hoke responds to legal questions faced by sections and branches here each month. Send Tara an email with your question.
What are our financial reporting duties as a student chapter?
ASCE has recently received questions concerning financial reporting from its student chapters. Each year ASCE National submits to the IRS a group Form 990, a federal tax return identifying the income, expenses, and activities of ASCE’s sections and their various subunits. ASCE completes these forms using the information provided in the Section Annual Reports.
Student chapters are unique among ASCE’s organizational entities in that they may organize themselves for the purpose of financial reporting as a subunit of either their local section or their university. Most of ASCE’s student chapters, and particularly ones that rely heavily on university endowments or alumni contributions, choose to structure themselves as a subunit of their university, using the university’s tax identification number and reporting their finances and activities through the university’s tax filings. Some, however, and particularly chapters whose activities are largely independent of university funding or whose universities create an unreasonable delay in approving withdrawal of chapter funds, may prefer to be structured as a subunit of their local Section or Branch. These student chapters may be using their Section’s tax identification number to establish bank accounts or for other purposes, and accordingly, they should be providing an annual summary of their income and expenses to the Section, for inclusion in the Section’s Annual Report.
While ASCE’s student chapters receive the same tax-exempt treatment as the Society, and are not expected to generate a sizeable amount of receipts (as a percent of the total receipts reported on ASCE’s group 990), ASCE believes it is important for its group Form 990 to present an accurate picture of the financial activities of its various subunits. Accordingly, ASCE asks that all Section financial officers take the lead in determining which of their student chapters may be using Section ID numbers in the conduct of their activities, and to request that any student chapter that is operating as a subsidiary of the Section provide the Section an annual accounting of its activities.
If you have questions about this or about any legal matter concerning your ASCE Section or Branch, please contact Tara Hoke, ASCE general counsel at thoke@asce.org.
ASCE General Counsel Tara Hoke responds to legal questions faced by sections and branches here each month. Send Tara an email with your question.