Do chapters have to have a 501c3 status to become affiliated?

Do chapters have to have a 501c3 status to become affiliated?

A:

The affiliation agreement can only be signed by a representative of a legal entity.  So chapters need to have some form of legal status in order to become affiliated but do not necessarily have to be a 501c3.

As part of our development of the Chapter OS, we determined that the strongest model for balancing network connection and chapter autonomy was for each chapter to exist as its own legal entity. This allows chapters to operate independently and have greater control over their own finances.

There are different types of legal statuses that would allow chapters to do things like open a bank account or fundraise including fiscal sponsorship, state level incorporation and, of course, federal tax exemptions (501c3, 501c6, etc.) Chapters can incorporate within their state and may even be able to receive a state nonprofit designation as a precursor to obtaining their federal tax exempt status. We have developed a set of resources to help chapters understand their basic scope of options. But see your relevant state laws for more information on how to incorporate in your state and what designations might be available to you at the state level.