Club Structure

[BDB]

I'm the new president of RIMRA, the NAR-affiliated club that launches in southern Rhode Island. We have previously operated "casually"--without official non-profit status. This has not been a problem for our regular operation, but I'm exploring the option of registering as a non-profit via 501(c)(3) or a social club via 501(c)(7) so donors could deduct donations to the club, and so we could possibly apply for funding via local grants. That's the upside to being "official." The downside, of course, is the paperwork.

How are other clubs in the US organized? I'd like to hear the pros and cons from you.

I'm happy to donate some time to the club so I and others can enjoy it. But above all, I want to keep in mind that this should be fun--if it becomes too much like work, it's no longer a hobby.

 

[smstachwick]

Excellent question, I can’t say I know the answer. Consider my reply a bump.

 

[Steve Shannon]

I'm the new president of RIMRA, the NAR-affiliated club that launches in southern Rhode Island. We have previously operated "casually"--without official non-profit status. This has not been a problem for our regular operation, but I'm exploring the option of registering as a non-profit via 501(c)(3) or a social club via 501(c)(7) so donors could deduct donations to the club, and so we could possibly apply for funding via local grants. That's the upside to being "official." The downside, of course, is the paperwork.

How are other clubs in the US organized? I'd like to hear the pros and cons from you.

I'm happy to donate some time to the club so I and others can enjoy it. But above all, I want to keep in mind that this should be fun--if it becomes too much like work, it's no longer a hobby.

Many larger clubs are incorporated, but many small ones are not. Our small club never saw a real benefit. Once upon a time the NAR allowed Sections to use their tax ID to receive gifts and donations.

 

[RocketPro]

ROC is incorporated in CA, a 501(c)(3), a tax-exempt entity in CA, and a charitable trust in CA. Each one of those designations carries benefits and annual paperwork. It’s not huge paperwork, but it has to be done every year. Most of those things are a state thing with the primary benefit being legal liability is transferred from the club officers to the corporation. Every state is different, as you can imagine, California has a bunch of requirements. It does help with our landowner, the Federal Government, so that’s a plus for us.

Of course, we have over 200 dues-paying members and regularly have hundreds of spectators and have been sued before…so we’re a little protective of our Board of Directors.

I would find another local club of any type and talk to their officers. The requirements of Rhode Island are certainly different than CA or other states.

 

[Hobie1dog]

Keep it simple. Otherwise it's never ending with legal BS, political masturbation, etc.

 

[Tyeeking]

Keep it simple. Otherwise it's never ending with legal BS, political masturbation, etc.

Good sound advice.

Clubs inevitably have about 10% of the members doing 90% of the work. It’s human nature. The more complex/work intensive things become the harder it will be to hold onto that important 10%.

 

[RocketRev]

Neither NAR nor Tripoli require local clubs to get incorporated as a non-profit 501c3. And that's a good thing because it can be expensive to get done. Our club is in Illinois. Once so designated the continuing paperwork is negligible. Obviously your state may make that very different.

I like the idea of getting incorporated eventually. Its better cover for your club's board and your volunteers in todays litigious society.

It also gives you the option to take donations and NOT have to have somebody declare it on your taxes which is something Illinois does.

There will probably come a time when you should get incorporated, but I've never really heard what the factors are in making that decision. Somebody should research and let us all know.

Brad

 

[dhbarr]

Tulsa Rocketry is TRA 42, NAR 812, and 501(c)(3). The best part for me is that I can send them pre-tax funding through Benevity.

 

[Steve Shannon]

When I considered filing for incorporating as a nonprofit some of the rules associated with it were the reason I didn’t. For instance, nonprofit organizations have strict rules regarding lobbying. Then there’s the whole tax filing. Also, as part of the filing process we would have been required to establish a process to divide the possessions of the corporation in case of dissolution. For a tiny club it just didn’t make a lot of sense. Or quite possibly I just didn’t want the added responsibility of tracking all the requirements and making sure we were compliant.

 

[dr wogz]

We are looking to 'incorporate' so the club can own the club's trailer (and other items), not a particular individual / club member..

slow process..