Thread: Association Financial Questions

ok..need major help...

I stepped into the role of "finance chic" for a local association. The previous person established the association as a sole proprietor and basically ran the assoc. taxes with her bellydance business. It worked but it is not going to work anymore.

I have been researching LLCs, Corporations, etc. All the board does NOT want this to impact our personal finances.

The overall goal would be to become a non-profit but I am being told that it is very expensive and lengthy process.

We need a solution now!!

Any suggestions from fellow association trailblazers?

I am at a loss...

LLC is either a partnership or sole proprieter

S corp you still reciecve a k-1 for your personal return

Non-profit is most likely the way to go

Get some professional advice, is my advice.

I am a former treasurers for the Middle East Dance Guild of Eugene (MEDGE) in Oregon and I also had to deal with this question. Before I was treasurer, previous treasurers were putting money in a more personal type of account. Not being comfortable with this situation, I ended up applying and receiving non-profit status for our organization. The paperwork is kind of a pain but it was not expensive and once you get 501c3 status, it opens many doors--you can apply for grant money, many performance venues give discounts for non-profit organizations etc.

You do need mission statements, by-laws etc., but as an organization, you should have that kind of stuff anyway.

I also sent out a blanket request for help to the guild and found some people in the group who worked as paralegals who reviewed my work before I sent it to the feds.

I would highly recommend putting in the effort to getting non-profit status. It will take a little bit of time to get the paperwork figured out but it is worth it in the end. Good Luck!

thank you! We have found an accountant to assist us with this goal...

The next thing is to reach out to the members and see if we have the "lawyer" connection too. We have a nice size member vase so something is bound to turn up.

The mission was already established and bylaws are being written as we speak.

This is so exciting and thank you all for your advice!!

Originally Posted by ravenadesigns

thank you! We have found an accountant to assist us with this goal...

The next thing is to reach out to the members and see if we have the "lawyer" connection too. We have a nice size member vase so something is bound to turn up.

The mission was already established and bylaws are being written as we speak.

This is so exciting and thank you all for your advice!!

Yay! And good luck to you, it IS exciting to embark on a new venture!

Ravena, Locally, you can ask WAMEDA people. They've been through that process and may be able to offer some guidance.

Originally Posted by oralia

...The paperwork is kind of a pain but it was not expensive and once you get 501c3 status, it opens many doors--you can apply for grant money, many performance venues give discounts for non-profit organizations etc.

You do need mission statements, by-laws etc., but as an organization, you should have that kind of stuff anyway.

This. I'm not an attorney, just work for some & we do entity formations (LC, LP, Inc., etc.), but operating an association under sole proprietorship/assumed name sounds like it could get hinky as far as monies go. Definitely apply for non-profit status so the IRS and/or Attorney General's office doesn't come knocking on anyone's door.