A step-by-step guide to starting a nonprofit membership club

Are you thinking about starting a club or social group, or do you already have one that you’d like to run more professionally? Establishing your group as a nonprofit membership club is a great way to promote growth, establish your organization, and adhere to regulations. Follow this guide to learn how to start a nonprofit membership club and the steps you’ll need to take.
A step by step guide to starting a nonprofit membership club

Identifying your purpose and goals

Are you uncertain whether your club qualifies as a nonprofit membership club? Any organization that maintains membership but doesn’t operate for profit can be a nonprofit membership club, including sports teams and leagues, booster clubs, fraternities and sororities, and other clubs and social groups.

The first step to starting a nonprofit membership club is to determine the purpose and goals of your club. This provides clarity for the individuals running the club, letting them make decisions that align more closely with concrete goals. You should also put your club’s purpose down in writing as part of the process.

Establishing the mission and vision of your club

If you’re creating a sports club, are you committed to improving health and wellness, fostering a sense of community, or just some friendly competition? Write out why you’re forming the club.

With an understanding of the general mission of your club, you can start developing some more tangible goals and objectives. Even in the early stages of planning, you should develop a clear idea of what your club will do once formed.

Incorporating your nonprofit membership club

Once you have a firm grasp of what your club is about and your plans for running it, you can incorporate your club and make it official. Incorporation and registration allow you to operate your club without any tax liability, ensuring that all member dues are put toward club activities instead of taxes.

Incorporation establishes your club as its own distinct organization. The process is done at the state level, with many states offering simple online systems to do so. You can also find online services that can help you incorporate your club for a small fee.

To incorporate your club, you’ll need to draft bylaws that lay out how it will be run. The bylaws will include details about the leadership structure, how leaders are chosen, the club’s mission, and club activities. You’ll also need to define your fiscal year, even as a nonprofit.

Every organization needs an employee identification number (EIN), even if you aren’t going to have any employees. This number will serve as your membership club’s tax identification, and the IRS lets organizations register for an EIN online.

Once your organization is incorporated and has an EIN, you can file for your tax-exempt status. This establishes your membership club as a 501(c) organization with the IRS, meaning that you won’t have to pay taxes on nonprofit membership club dues.

Setting member fees and dues

With your club established, you need to determine how much you’re going to charge for nonprofit membership club dues. You need to ensure that you have enough to fund club activities, but you also need to find a value that is fair for club members.

Membership fees are one of the primary concerns of new members of any club. You might consider offering discounts on membership during times when you’re trying to grow your club. Adding incentives for members can also help drive recruitment, making joining your club seem like a more attractive bargain. This could be something as simple as custom t-shirts with your club’s logo.

Building and managing your membership base

A club with a thriving membership base is able to proceed with more of its planned activities, broadening its horizon and making more efficient use of resources. However, growing your club can be difficult.You need to reach new members, and that requires a marketing and outreach plan. 

Consider the specific niche that your club appeals to and which specific types of marketing are most effective. The right answer could be print flyers, social media, or other marketing methods.

Joining your club should be easy for any prospective members. Make sure that your signup process is streamlined so that no new members are put off by it. You also want ongoing operations to be as smooth as possible. Nonprofit member management software can make collecting membership dues and other areas of financial management incredibly straightforward for your club.

Organizing club events and activities

As your club moves forward, you should continue to plan and execute events and activities that provide more value for your members. Creating exciting and entertaining events can improve member involvement and participation, ensuring that your membership base gets the most out of the club. This also helps provide great word-of-mouth for your club, drawing in new members as well.

Organizing and carrying out events can be difficult when you’re dealing with multiple members carrying out different roles in planning and execution. Dealing with funds for activities can get complicated quickly, so using the right nonprofit member management software is key. You need to track all expenses, along with having a practical way for different members to access club funds.

Setting your nonprofit membership club on the right track

Starting from a solid foundation is the best way to ensure the long-term success of your club. By defining your purpose, incorporating and registering your club, and moving forward with recruitment and activities, your club can continue to grow and thrive. However, you also need the right solution to handle membership and finances.

Crowded makes it easy to handle the financial details of running your club. With our integrated banking platform, you can manage your group’s finances without worrying about high banking fees, scattered systems, or complicated accounting apps. We offer features like automated membership dues collection and digital Visa debit cards for members to make club expenses more efficient and trackable. Start your newly-founded nonprofit membership club on a financially viable path by creating a free Crowded account today.

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