Why You Should Incorporate Your Community Tennis Association
- Structure: Incorporation provides structure to the organization by requiring articles of incorporation and bylaws. It also solidifies the board so that they have more of a vested interest in the organization.
- Liability
: By incorporating your association, your group is able to purchase Directors and Officers (D&O) insurance which protects individuals on the Board of Directors.
- Tax exemption
: Incorporation is a necessary step for obtaining recognition from the Internal Revenue Service for the association’s exemption from federal income tax.
- Credibility
: Incorporation and tax exemption provide an organization with credibility when dealing with members, sponsors and other organizations. It also gives a CTA more leverage in applying for grants and donations.
How Can You Start the Incorporation Process?
The first and most important step is to involve an attorney on your Board of Directors who is willing to file your articles of incorporation and apply to the IRS for tax exempt status. Professional help is a must as mistakes can be difficult to correct and costly to your CTA. The Board of Directors shall adopt the initial bylaws of a corporation. The bylaws are a CTA’s power document and contain the provisions for the regulation and management of the affairs of a corporation not inconsistent with the articles of incorporation. Incorporation can cost a CTA anywhere from $15 to $50.