Youth Baseball Organizations Tournament
Author: Baseball Bob
Youth Baseball Team Organized as Nonprofit – Question about how money raised by the team can be distributed?
Our 11U baseball team became a nonprofit organization this year so we can raise money for our kids to play in a tournament in Cooperstown NY next year. The team has not applied for tax exempt status and will not raise more than $25,000 this year. The families of the team have been working a USANA amphitheater concession stand to earn money towards tournament registration fees and travel expenses. USANA pays us with a check made payable to the nonprofit name of the team. The coach of our team announced that the USANA money earned is property of the team, meaning if a family leaves the team, they will not get the money they worked for. I’ve done some checking on the IRS website and it appears that if we don’t have tax exempt status and raise less than $25,000 during the year, we don’t have to file a return. If that’s correct, the IRS won’t require detail of how money we raise is distributed, and our coach can’t keep the money from the families that earned it? Any advice for us?
Yeah, have all the parents (or at least a majority of the parents) of the players of your team agree that if someone leaves the team, they get some kind of refund, maybe not 100%, but at least get something. If the parents all agree then the coach can’t decide to go against the parents decision.
I have included a link to irs information regarding tax-exempt status. I think you may still need to apply to the irs for 501 (c) (3) status as a non-profit, but you are correct that if your organization does not have $25,000 in gross receipts then it does not have to file a 990. Gross receipts does not mean profit though. If you raised $30,000 in revenue and had $25,000 in expenses, your net profit for the non-profit (yeah, I know, seems like a contradiction, doesn’t it?) would be $5,000, but your gross revenues would be $30,000, which would be over the $25,000 threshhold. Best bet is to file for the official non-profit status, that way people who donate to the organization can get a tax deduction for their donation, and if the organization grows larger and revenues grow larger, you’d be all set with the IRS.
Dixie Youth Baseball District 6 Coach Pitch Tournament