Bank Account General Information
Steps for Opening a Bank Account
Tax ID Number FAQs
Requesting a Tax ID Number for your student org
Bank Account General Information
Bank accounts are a great resource for student organizations to house monies that your group may raise through off-campus fundraisers, collection of dues, proceeds from an event, etc. Students are strongly discouraged from housing student organization funds in their personal bank accounts. Doing so could make you personally liable for taxes as well as make you vulnerable to accusations of misuse of your organization’s funds.
While neither SORC nor the University of Maryland regulates or has access to off-campus bank accounts for student organizations, we do encourage groups to open accounts under your student organization to establish financial controls and to limit the risk of mismanaging organization funds, specifically the use of funds for personal gain.
Student organizations can select any bank of their choosing. However, one option is the M&T branch conveniently located on the ground floor of Stamp. This is the branch of M&T that works specifically with UMD student organizations; other branches of M&T may not.
For specifics on opening an account at this branch, you can visit them, email them at email@example.com or call them at 410.613-2370.
If you are interested in choosing a bank outside of the aforementioned branch of M&T, you will need to reach out to the bank of your choice to find out and fulfill any other requirements for establishing and maintaining an account.
Steps for Opening a Bank Account
Always contact the bank that you wish to open an account with to determine exactly what will be required to open an account, even for M&T. Requirements may differ depending upon your organization and the specific bank. The information below is NOT guaranteed to be comprehensive.
- If opening an account with M&T, confirm that your organization’s registration is up-to-date in Terp Link. If your organization’s portal is up-to-date, proceed to Step 2. If you have not registered your organization or your organization’s registration needs to be updated, follow these step-by-step instructions.
- Obtain a Bank Letter from SORC (for M&T ONLY)
- Fill out a “Bank Letter Request” form in Terp Link.
- You will receive a notification via email once your form is approved. Pick up a copy of your letter from the SORC office, located on the ground floor of Stamp in the Student Involvement Suite.
- Obtain a Tax Identification (ID) Number (also known as Employer Identification Number or EIN)
- All banks require that your organization provide a Tax ID number in order to open an account.
- If your organization has not previously applied for a Tax ID number, you will need to obtain one before opening a bank account.
- The president and treasurer must take the bank letter and Tax ID number as well as any other required documents and identification, to the bank of your choice.
- Groups are strongly encouraged to save all files related to your bank account in your Terp Link portal for future members.
Tax ID Number FAQ's
- What is a Federal Tax ID Number/EIN?
- The Federal Tax ID Number (also known as the Employer Identification Number or EIN) is a number issued by the Internal Revenue Service (IRS) and is used to identify a business or other organization, similar to a Social Security number for individuals.
- Organizations should not open a checking account using an individual’s social security number. Doing so puts the financial burden of that account on that individual and they become responsible for claiming any interest accrued on that account on their own taxes. They also become responsible for the account if there is a problem with it.
- Why do I need a Federal Tax ID Number?
- Banks are required to report all funds that are deposited into any bank account and the Tax ID number is used by the IRS to track those funds.
- If your student organization engages in off-campus fundraising, organizations that you partner with are required to notify the IRS of any donations to your organization and must provide the IRS with your Tax ID number.
- Additionally, obtaining a Tax ID number helps to ensure the IRS will not make any of an organization’s members personally responsible for taxes on revenue that the organization has earned.
- Can we just use the University’s EIN?
- Registration as a student organization with UMD does not imply tax-exempt status and student organizations are not allowed to use the University’s Tax ID number or non-profit status. Student organizations are independent entities responsible for their own finances and establishing and maintaining their tax status with the IRS.
- Is the Federal Tax ID Number the same as being a non-profit organization?
- No. Student organizations are not Federally Tax-Exempt Non-profit Organizations. Only the federal government can confer charitable status on an organization. Filing for charitable status (501(c)(3) status) is a lengthy legal procedure that commits the organization to the rigorous annual reporting procedures required by the IRS.
- If you wish to learn more about applying for 501(c)(3) status status, the Undergraduate Student Legal Aid Office can provide that assistance.
- How do I get a Federal Tax ID Number?
- The easiest way to apply is online through the IRS website. You will be walked through the application and receive your number immediately. You can also apply by mail or over the phone.
- Is there a charge to obtain a Federal Tax ID Number?
- No. The IRS provides this service free of charge. There are websites who offer this service for a fee. DO NOT use these companies as there is no guarantee that they are legitimate and you should not be paying for a service that is provided free of charge by the IRS.
Requesting a Tax ID for your student group
To obtain a tax ID for your student group
- Go to the IRS’ Apply for an Employer Identification Number (EIN) Online website found here.
- Please note - The IRS does not charge for this service. If you are on a site that is requiring that you pay a fee to obtain an EIN then you are not on the IRS website.
- Click on the Apply Now link on the right side of the page.
- After you start the application, select “View Additional Types, Including Tax-Exempt and Governmental Organizations”. Be prepared to provide the following information:
- The type of group you are creating (After you select the type of group the application will give you a description of the group and an option to change it)
- The name and social security number of the person filling out the application.
- The official address of the organization (Do not use the SORC address)
- Enter the requested information about your organization and click the Continue button when you are done. The Tax ID number will be generated immediately
- SORC Financial Services staff are not qualified to assist groups with this process. If you have any questions regarding this process, you should contact the IRS directly. The IRS also provides a great deal of information on their website that you should review before submitting the request.
- Student organizations are strongly encouraged to save a copy of their Tax ID number under the “Files” tab in their Terp Link portal to ensure that future leaders have access to this information.
- If you have lost your EIN, you can find information on the IRS website on how to retrieve it.