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New travel team /501c(3) status or not

Oct 16, 2019
7
3
I have started a new travel 10u girls fastpitch team comprised of 12 girls. We have insurance , facilities to practice in,team checking account, and already signed up for tournaments and started practicing. I would like to seek sponsorship from local businesses and fund raise, but want to do so with out getting into any legal trouble later. Should i fill out a W-9 form to get a tax id and then try to get 501c(3) status for a non-profit and tax exemption or is this overboard for what we are doing. We are keeping our tournaments within 1 hour this season and only need the extra money to help pay for uniforms and tournament costs. However in the future we may add more teams. What name do I put on line (1) of the W-9 and do I mark it a sole proprietorship since i am not a organization as of yet? Also if anyone has good advice on where to go get assistance on filling out the forms for 501c(3) please point me in the right direction.

Thanks for the help in advance.

Morrison Fury
So, two years later, how did this go? Just curious. I may be forming a new organization. What big hurdles did you have?
 
May 29, 2015
1,573
113
As was mentioned before, consult an attorney and tax professional for assistance with setting up your corporation.

SET UP A CORPORATION company. Preferably an LLC. If you operate as a sole proprietorship, the money you collect is personal income and you are still personally liable for any debts and damages. If you think it is worth putting your home and retirement on the line, operate as a sole proprietorship. An LLC establishes the business (yes, this is a business) as its own entity. This will protect your personal interests.

Do not use 501(c)3 as any bar or necessity. That is a popular misnomer that people slap on all not-for-profit organizations. There are various 501c classifications, all are tax exempt. 3 is generally a charitable organization (and usually not worth the cost to most small not-for-profits. Keep in mind, applying for tax-exempt status carries additional responsibilities you will need to meet. Did I mention talk to an attorney and tax professional? Do your basic research here: https://www.irs.gov/charities-and-nonprofits

Talk to your insurance agent (or a reputable insurance agent). You will want to carry an umbrella policy, particularly if you are forming a full organization as opposed to just a team. Still very important if you are just one team though.

Talk to a business or organizational development consultant (I may know one of these ;) ). Again, especially if you are going to be forming an organization, you want to make sure the roles people play are clearly defined (paid, volunteer, duties, etc.) and that you have proper "employee" policies in place. You want to make sure there is a succession plan for your business. Again, protect yourself.
 
Last edited:
Dec 6, 2019
26
3
As was mentioned before, consult an attorney and tax professional for assistance with setting up your corporation.

SET UP A CORPORATION. Preferably an LLC. If you operate as a sole proprietorship, the money you collect is personal income and you are still personally liable for any debts and damages. If you think it is worth putting your home and retirement on the line, operate as a sole proprietorship. An LLC establishes the business (yes, this is a business) as its own entity. This will protect your personal interests.

Do not use 501(c)3 as any bar or necessity. That is a popular misnomer that people slap on all not-for-profit organizations. There are various 501c classifications, all are tax exempt. 3 is generally a charitable organization (and usually not worth the cost to most small not-for-profits. Keep in mind, applying for tax-exempt status carries additional responsibilities you will need to meet. Did I mention talk to an attorney and tax professional? Do your basic research here: https://www.irs.gov/charities-and-nonprofits

Talk to your insurance agent (or a reputable insurance agent). You will want to carry an umbrella policy, particularly if you are forming a full organization as opposed to just a team. Still very important if you are just one team though.

Talk to a business or organizational development consultant (I may know one of these ;) ). Again, especially if you are going to be forming an organization, you want to make sure the roles people play are clearly defined (paid, volunteer, duties, etc.) and that you have proper "employee" policies in place. You want to make sure there is a succession plan for your business. Again, protect yourself.
This is why you need an attorney. Not to pick on The Man In Blue, but so many people know things that aren't so. For example, a corporation is a completely different animal than an LLC (the 'C' in LLC does NOT stand for corporation). You can't have a corporation that is an LLC. That's not a thing. Also, ignore earlier posts in this thread referencing $2,000.
 
May 29, 2015
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113
D'oh! Yes @clarity! Go ahead and pick on me. I was typing too fast and not thinking it all the way through! I should have said company not corporation. (When I cite things, it usually means I slowed down. ;) )

Fully underscores the importance of talking to a PROFESSIONAL (not just hooligans on the internet offering free advice)! :)

Here is more free advice though ... https://www.legalzoom.com/articles/what-is-a-limited-liability-company-llc
 
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May 6, 2015
1,376
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Also, the 501c status may (or may not be, not an accountant or lawyer, and did not stay in a holiday Inn express in longer than I can remember) can be important in some states for certain type of fundraising, ie raffles, bingo, etc., since it can be considered a form of "gambling". I know it got to be a sticky issue for one of the orgs I was involved in (cannot remember which one) regarding raffles and box pools, etc.
 
Jan 8, 2019
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Yeah, we no longer have "raffles." We have "opportunity drawings." Not kidding. There are other things that go along those line like was mentioned.
 
May 29, 2015
1,573
113
No, no no! I don’t want to go on! I can’t live in a world with no waffles! The inhumanity of existence without that golden, fluffy ... what? Oh, raffles. Nevermind, continue ...

😇
 
May 6, 2015
1,376
83
Yeah, we no longer have "raffles." We have "opportunity drawings." Not kidding. There are other things that go along those line like was mentioned.
it it walks like a duck and quacks like a duck...

dont think a name change would really keep anybody out of trouble, IF someone in authority decided to come donw on an org (that was always the argument against bothering, who is going to complain/prosecute)
 
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