501 c question

[Doug666]

The other day I saw in a post that someone stated that some organizations are not registered as a 501c. If the organizations are not a 501 C, does that mean that they are forprofit? I didn't know that organizationscan actually make enough money from travel softball for someone to profit from it.

 

[cobb_of_fury]

Not sure you could make enough money with Just an organization - But if you have a facility to rent and you give lessons, etc there is a probably enough to get by on.
This is one of the things to look for when looking for a new organization - If it is not 501c - How much are you paying ala cart - How much more are the dues than other similar org's how much for bag's and Uni's
do the pitchers have to take lessons there do you have to take batting lessons there. are you doing the same number of tournaments as other org's.

I would typically lean towards a non-profit organization simply because they tend to take better care of the money and someone is auditing the spending. Not to say funds don't get misappropriated in non-profits.

 

[BruisedShins]

The other day I saw in a post that someone stated that some organizations are not registered as a 501c. If the organizations are not a 501 C, does that mean that they are forprofit? I didn't know that organizationscan actually make enough money from travel softball for someone to profit from it.

Not sure if this is sarcasm or not. The issue is with organizations which claim to have 501(c)(3) status. Those are the ones which can receive tax-deductible donations. There are other types of nonprofit entities too, like those under 501(c)(4) and 501(c)(7). Those organizations are tax-exempt, but donations to them are not tax-deductible.

Also, many nonprofits actually make money, just as many for-profit businesses actually lose money!

 

[cobb_of_fury]

Not sure if this is sarcasm or not. The issue is with organizations which claim to have 501(c)(3) status. Those are the ones which can receive tax-deductible donations. There are other types of nonprofit entities too, like those under 501(c)(4) and 501(c)(7). Those organizations are tax-exempt, but donations to them are not tax-deductible.

Also, many nonprofits actually make money, just as many for-profit businesses actually lose money!

True - Hospitals and Universities are "Non-Profit" yet have Millions and some Billions in profit -

I think what the OP was questioning is - is there enough Money to make a living at it?

 

[tjsmize3]

I don't know what others think, but I feel like the rules for maintaining a 501(c)(3) create more trouble for most organizations than it's worth. Most corporations write off their donations as "advertising" (if you do banner, website, etc...) as it is a better deduction for them than as a donation to a non-profit. Not sure I've ever really seen the advantage to all the extra work of having a 501(c)(3) on the relatively small scale most Ohio orgs operate at.

In terms of making money though, take a look at Tony Rico's Firecracker organization. Word on the street is he makes well over 1.5 million/yr on his softball org. He has teams in 17+ states at all age levels and last I saw people are still lining up to become a "Firecracker." Maybe for him this makes sense???

 

[Fairman]

There is a substantial cost (legal and fees) to get any 501 paperwork together.
It also must be approved which is not automatic.
The reporting and the governance of a 501 is also burdensome.
Most softball organizations don't make any money anyway and most 'donations' are written off as advertising.
Not really worth the effort and expense for most softball organizations.

 

[TheSoftballZone]

I'm aware of one organization that was going to lose their 501C due mostly because they took in so much money ever year. So they became a for profit business. The whole organization is ran like a business now.

 

[longball00]

What about an Organization that is 501c3, but will not take your DD, who is a pitcher, unless she is a student of the Org's leader who is a pitching coach. And, he charges for those lessons? This one seems funny to me.

 

[wow]

Actually very EZ to become a 501 in Ohio.

From http://www.sos.state.oh.us/sos/upload/publications/busserv/nonprofit.pdf

To be legally organized, a nonprofit corporation must file Initial Articles of Incorporation (Articles) (Form 532B) with the Ohio Secretary of State’s Office. The filing fee is $99.00. Ohio Revised Code Section 1702.04 provides a list of the information

 

[BruisedShins]

Actually very EZ to become a 501 in Ohio.

From http://www.sos.state.oh.us/sos/upload/publications/busserv/nonprofit.pdf

To be legally organized, a nonprofit corporation must file Initial Articles of Incorporation (Articles) (Form 532B) with the Ohio Secretary of State’s Office. The filing fee is $99.00. Ohio Revised Code Section 1702.04 provides a list of the information

Creating an Ohio nonprofit corporation does not give you 501(c)(3) status. As noted above, it's the IRS which confers the public charity status.

 

[wow]

Creating an Ohio nonprofit corporation does not give you 501(c)(3) status. As noted above, it's the IRS which confers the public charity status.

Correct, however is a step in the process.

There is a whole section on IRS guidelines.

 

[coachjwb]

Longball ... that is crazy, but I have a hunch who would do that ... you don't have to say the name, but are they based in NEO?

 

[longball00]

Longball ... that is crazy, but I have a hunch who would do that ... you don't have to say the name, but are they based in NEO?

Yes they are. I didn't want to name names and decided to take it down