How to Start a Non Profit Sports Team: Everything to Know
Wondering how to start a non profit sports team? Begin by choosing a name for your nonprofit entity.3 min read
Wondering how to start a non profit sports team? Begin by choosing a name for your nonprofit entity. You also need to have a physical address and a mailing address for the nonprofit. Also, you need to pick the people responsible for filing the documents to form the corporation.
You must have someone who can accept any legal mailings that the corporation receives. Before you file, though, you must plan for the future in regards to what goal you have for your nonprofit sports team. This is so you can explain why you need the team to be set up as a tax-exempt corporation.
Tips for Choosing a Name
There are some tips that can help you choose a great name for a business, and you can just as easily apply business-naming tips to nonprofit naming. Try these techniques out:
- Say the name out loud to make sure it sounds good.
- Choose a name that has meaning behind it.
- Choose a name that expresses the benefit of your nonprofit.
- Avoid using text speak, such as the letter U instead of writing out the word you.
- If you're considering using initials, use them with caution.
- Use something specific to your nonprofit in the name.
- Check to see if the name can be trademarked before you commit to it.
- Run the name through Google AdWords to see if it's something people are searching for online.
Establish the Purpose for Being Exempt
As a nonprofit, it's likely that you'll try to get tax-exempt status from the IRS. To do this, you need to list the special provisions that your organization offers and the purpose of it being tax exempt. You also need to have a dissolution provision that's acceptable to the government.
One of the first steps to becoming tax exempt is filing IRS form 1023. The IRS website makes the form available over the internet. Sports organizations for youth groups can usually qualify on any one of the three approved reasons. You can file as a 501 (C)(3) for educational or charitable purposes. You can also file as a 501 (C)(3) as an amateur athletic organization.
All purposes cited on the form must be covered by the acceptable tax-exempt status. There are instructions on the IRS website that explain how to fill out form 1023. The requirements for each tax-exempt status are explained there, as well. This application takes quite a bit of time to fill out, and it's fairly technical. It's recommended that you seek out the assistance of an attorney when filling it out.
Form 1023 Planning
Before you even file your documents to form a nonprofit corporation, you should prepare a draft of Form 1023. After the entity has been formed, showing your tax-exempt purpose and your corporation's disillusion provision, you can then add an attached, signed copy or unsigned certified copy of an electronically filed version of your Articles of Incorporation to your tax-exempt application.
The Election of Officers
At your first board meeting, you have the option to elect corporate officers. You can do this using the conditions set in your corporate by-laws. The corporate officers usually named at this meeting are the nonprofit's president, it's vice president or vice presidents, the secretary, and the treasurer. These professionals are all members of the board, and they're nominated and elected by the board.
The secretary or acting secretary should prepare a resolution that approves the elections. This person should sign it, as well. The information that's required for the directors and the officer is their names, the titles they've been assigned, their mailing addresses, and what compensation each will be receiving for holding those positions. The tax-exempt application must include information about what duties they're each expected to do and how many hours each of them will be working.
There are several more things you need to do to finish establishing your nonprofit sports team. These include:
- Applying for a tax ID number.
- Preparing the budget for your nonprofit.
- Getting registered with the state where your nonprofit exists before you start fundraising
- Enlisting memberships and materials for your team's coaches.
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