Manage A Colorado Booster Club

HOW TO CREATE A BOOSTER CLUB IN COLORADO

Creating a booster club in Colorado is a time consuming task, but once achieved is a very rewarding organization. Below is a step-by-step How To on creating and starting the basics of a Colorado Booster Club. Whether it be athletic, drama, or music, following the steps and the state and federal laws, you will be on your way to founding your own booster club!

Creating a Board of Directors for a Colorado Booster Club

One of the first steps to creating a booster club is establishing a board of directors. In Colorado, your nonprofit must have one or more directors. The next step is to file an article of incorporation. The articles of incorporation need to include basic information such as your nonprofit’s name, your nonprofit’s statement of purpose, certain provisions required for state and federal tax-exempt purposes, and the name and address of your registered agent (the person to whom legal notices should be sent).

Utilize the Colorado Secretary of State Website For Your Booster Club

The information and materials necessary to meet state requirements for building your Colorado Booster Club can be found at Colorado Secretary of State. The website provides a variety of resources that you may need in order to create the appropriate Colorado Booster Club. The Colorado Secretary of State website has a link for general information for nonprofit and charity organizations, which can be useful for those starting out in the booster club creation process. Other information, like forms, needed to create a nonprofit corporation or charity organization can also be found on the site as well. Additionally, the Colorado Secretary of State website provides a corporation search engine that allows you to determine the availability of your desired booster club name. You should try to avoid having two organizations with the same name since it is highly unwanted by most states; aim to have a few name options picked out in case your first choice for a name is already taken.

Review the IRS Website for your Colorado Booster Club

The IRS website provides federal rules, as well as the resources that may be needed to build your booster clubs, such as information about forms nonprofits may have to submit to found a Colorado Booster Club. The IRS also provides tax information for nonprofits, which you may find helpful if you decide to make your booster club a tax exempt organization. Employee Identification Number (EIN) application guidelines, which may be needed to submit certain forms and to open a booster club bank account, are also provided on the IRS website. The IRS website provides information on multiple ways to apply for an EIN, which allows you to found your Colorado Booster Club with ease.

Apply for Tax Exempt Status For Your Colorado Booster Club

When preparing to create your Colorado Booster Club, you should look into structuring your booster club as a tax exempt organization. Tax exempt status can be beneficial for a booster club in numerous ways. For example, a nonprofit corporation puts it’s mission and structure above the financial benefits of individuals associated with it. There are other advantages, as well as disadvantages to look into when founding your booster club as a non-profit. Grantspace has a list of a few, and federal guidelines for tax exemption application can be found on the IRS website as well.  If you need further guidance, the Hurwit & Associates website provides the guidelines for both state and federal tax exemption applications in Colorado, as well as any other forms or information you may need to create a booster club in Colorado.

To help ensure that you’ll receive 501(c)(3) tax-exempt status from the IRS, you’ll need to include specific language to receive tax-exempt status, such as a clause dedicating the nonprofit’s assets to another 501(c)(3) nonprofit organization should your nonprofit end. Your state form may include these provisions already, but, if not, consult a legal self-help guide such as How to Form a Nonprofit Corporation, by Anthony Mancuso (Nolo), to make sure your articles comply with Colorado’s nonprofit laws.

Open a Bank Account for Your Colorado Booster Club

In order to have a properly functioning booster club in Colorado, there must be an organized way of banking. Without clear protocol for managing club finances, mismanagement of booster club funds increases drastically. Creating a booster club bank account will provide some of the structure you and your future organization will need to properly regulate and manage your booster club funds. Additionally, a booster club bank account expands the methods through which your booster club can conduct fundraising. Bank accounts open a door to online fundraising; booster club websites with the capability to accept online donations can often be set up with the bank account so that these donations are deposited almost directly into your Colorado booster club bank account. The legalzoom website provide general guidelines for creating a bank account for a nonprofit organization:

• Form a corporation with the state in which the nonprofit will conduct business. A nonprofit may apply for tax-exempt status, and this status is granted by the Internal Revenue Service, not the state where the organization is formed. Generic articles of incorporation or organization are created when you form the entity, but you may draft more individualized articles if you wish and file them as an attachment to your business formation documents.
• Apply for an Employer Identification Number (EIN) from the IRS. You can apply for an EIN online on the Internal Revenue Service website. After your application is submitted, you’ll receive the EIN instantly.
• Apply for nonprofit status with the IRS. After your corporation and EIN have been established, you may complete and submit IRS Form 1023.This form requires information about the nonprofit’s business structure and formation, its officers and its financial arrangements. You’ll also provide information about who will receive benefits from the organization and the activities of your nonprofit.
• Gather official organization documents required to open your bank account. Standard documents to open a nonprofit account include a copy of your nonprofit’s articles of incorporation, articles of organization or charter, and a copy of the Employer Identification Number issued by the Internal Revenue Service. These documents show when your organization was formed with the state and prove your organization’s tax identification number.
• “Gather information about the organization’s officers. These documents include an official list of all officers and government-issued identification for each officer. Official officer listings may be found in your nonprofit organization documents filed with the state. Banks typically require this information for each officer, even if an officer will not make deposits and withdrawals from the account. Providing a photo ID and Social Security card for each officer is standard, but some banks may also require an additional form of ID.”
• Select a bank. Most national banks offer accounts specifically for nonprofits, but you may also find smaller local banks or credit unions that offer nonprofit products. Review the websites of banks in your area to get information about fees, minimum balances and benefits available to your organization.

Although these steps are helpful, you will still want to carefully consult the different rules,  benefits, and options of different banks.

Prepare Bylaws for Your Colorado Nonprofit Corporation

It is important to prepare bylaws that comply with Colorado law. Your booster club bylaws contain the rules and procedures your organization will follow for holding meetings, electing officers and directors, and taking care of other corporate formalities required when running your booster club in Colorado. For more information, see Nolo’s article Nonprofit Formation Documents: Articles of Incorporation, Bylaws, and Organizational Minutes or, for help creating your bylaws, see Boostr’s previous article on the subject. Once you have created your bylaws, file them safely away. They are for your organizational reference only and do not need to be filed with the Colorado Secretary of State.

Hold a Meeting of the Boards for Your Booster Club

Your first board meeting is usually referred to as the organizational meeting of the board. The board should take such actions as:

• Approving the bylaws
• Appointing officers
• Setting an accounting period and tax year, and
• Approving initial transactions of the corporation, such as the opening of a corporate bank account.

After the meeting is completed, minutes of the meeting should be created by a designated board member. This information, as well as any other important documentation should be recorded in binders. These corporate record binders must be organized and safely kept by a member of the booster club for any future reference. For more information, as well as minutes forms, consent forms, and other resolutions, see Nonprofit Meetings, Minutes & Records, by Anthony Mancuso (Nolo).

After reviewing this article and following the steps included, it should seem simpler to create your Colorado Booster club than you might have thought. Along with our overview we have linked several helpful websites that will provide the additional guidance in the creation of your organization. We are excited that you have taken the steps on the road to successfully supporting your activity, school and community via your new Colorado Booster Club!