Line of business, not individual members
The organization must advance a whole industry or profession. Providing particular services to particular members is the most common reason applications are refused.
Tax-Exempt Formation
501(c)(6) Business Leagues & Trade Associations
A 501(c)(6) is the section for business leagues, trade associations, chambers of commerce, and professional societies — organizations that advance the shared interests of an industry or profession rather than running a business themselves.
501(c)(6) Formation
$2,999Complete formation package • state filing fees included
- Confirmation that 501(c)(6) is the right section for you
- Name availability search
- Articles of Incorporation prepared and filed
- Purpose language drafted for 501(c)(6)
- Federal EIN (FEIN) registration
- IRS Form 1024 preparation and submission
- Bylaws and governance document templates
- Conflict of interest policy template
- Responses to IRS follow-up questions
- State filing fees included
Flat fee • state filing fees included • no surprise add-ons
What a 501(c)(6) is for
Section 501(c)(6) covers business leagues, chambers of commerce, real estate boards, boards of trade, and professional football leagues. The common thread is an organization improving conditions in one or more lines of business, as distinct from performing services for individual members.
That distinction does real work. An association that promotes an industry generally qualifies. One that primarily provides services members would otherwise buy for themselves generally does not.
The trade-off to understand first
Member dues are not deductible as charitable contributions. They may be deductible as ordinary business expenses, but the portion attributable to lobbying is not — and the organization must either notify members of that non-deductible percentage or pay a proxy tax on it.
What to Get Right at Formation
The issues that most often cause trouble later, addressed at the start.
Dues, lobbying, and the proxy tax
If the association lobbies, it must tell members what share of their dues is non-deductible, or pay a proxy tax on those expenditures. Getting this process in place at formation avoids retrofitting it later.
Unrelated business income
Trade shows, publications, and advertising revenue each have their own treatment. Structuring them correctly at the outset avoids unexpected tax on activities you assumed were covered.
Not sure this is your section?
These categories overlap more than they look like they do, and the wrong choice is expensive to unwind. Tell us what your organization actually does and we will tell you which section fits — before you pay for anything. Ask us first.
501(c)(6) Questions
Are membership dues tax-deductible?
Not as charitable contributions. Dues may be deductible as a business expense, except for the portion attributable to lobbying, which must be disclosed to members or covered by a proxy tax.
What is the difference between a 501(c)(6) and a 501(c)(3)?
A 501(c)(3) serves a charitable, educational, or similar public purpose and can receive deductible donations. A 501(c)(6) advances the shared business interests of its members and cannot.
Can a chamber of commerce qualify?
Yes. Chambers of commerce, boards of trade, and real estate boards are expressly contemplated by Section 501(c)(6).
Let’s get your organization formed correctly.
Flat fee, state filing fees included, and a clear answer on whether 501(c)(6) is the right section before any work begins.