Please note: The following information is specifically part of a Pilot program that the HEMA Alliance is rolling out in order to better serve the community. There will be improvements and changes to the workflow as we go along, ending with permanent changes. Everyone participating will be notified of any updates via email. If you are a participating affiliate and have constructive feedback, please feel free to email us, gc@hemaalliance.com. By agreeing to participate in this pilot program, you are consenting to give us state-specific feedback on the process that will be part of the documentation arm of this process. This is new territory for us to, so please be patient.
What is a 501c3?
A 501c3 is a non-profit organization designation that is exempt from federal and state taxes. The HEMA Alliance is an educational 501c3 non profit and it may be a good idea for your affiliate to become one as well.
The HEMA Alliance can only be responsible for its own taxes, but will help affiliates become their own 501c3 federally.
This offer is for affiliates in good standing with the HEMA Alliance, which means at least 2 years of continued membership
This offer may only be taken once per affiliate
This offer is for affiliates who have been and will remain (or plan to) with the HEMA Alliance for at least 4 years
This offer comes with responsibilities
1. Should our affiliate become its own 501c3 chapter?
If your affiliate wishes to open a bank or PayPal account with 501c3 benefits, then yes. It will be necessary for you to have a 501c3 with its own unique EIN number that is tied to the affiliate's name.
If you are prepared to maintain the 501c3. It will be necessary to file state and federal taxes each year in order to maintain your 501c3. This is entirely your responsibility.
You’ll also have more freedom to accept tax-exempt donations.
2. What are my responsibilities?
The HEMA Alliance will assist your affiliate in becoming a 501c3 though certain responsibilities fall onto you.
Every year taxes must be filed to both the state and federal government. To do this, you will want to have receipts on hand and either work with a tax professional or file on your own. 501c3 organizations making less than $50,000 year uses federal form 1090 and each state is different as to what it requires. It is entirely your responsibility to file taxes each year.
You must maintain the 501c3. The HEMA Alliance will only help in the initial creation of the 501c3, after that, it is your responsibility to maintain it, including paying any fees due to late filing or losing of the status.
As a non-profit you will want to be aware of our spending policy. This is no different than required of all affiliates of the HEMA Alliance, but should be paid close attention to for those wishing to become a 501c3.
For a good rule of thumb, see our policies: https://www.hemaalliance.com/club-affiliation
States and the IRS allow nonprofits to pay reasonable salaries to officers, employees, or agents for services rendered to further the nonprofit’s tax-exempt purposes.
HEMAA has dissuaded this because of added difficulties to the tax season.
The same goes for large donations to affiliates.
Ultimately reporting to the IRS and state is the responsibility of the affiliate.
You must remain a part of the HEMA Alliance for at least 4 years (see below) in order to receive the full $500. The HEMA Alliance is assisting in the creation of your 501c3 and as such expects you remain with the alliance. Your dues allow for cheaper insurance, discounts, and programs such as this one.
You must be accurate in setting up your 501c3. If you do not set it up correctly, the HEMA Alliance cannot assist you in fixing what is wrong. The suggested service may be able to, but all charges for such will be your responsibility.
3. What information do I need before becoming a 501c3?
You will need a few things in advance to become a 501c3.
You will need a board of directors including a President, Secretary and Treasurer.
You will need to tell the (service) that you wish to be an educational non-profit. Your primary purpose is to teach the history and techniques of historical European martial arts.
You will have to answer a few questions on how you will conduct meetings and how you will collect money. We recommend you only take in donations and dues from your club members. Sales, equipment/land grants, etc. are possible, but require much more tax-work on your end as is your responsibility.
4. What will HEMAA do to make my affiliate a 501c3?
The HEMA Alliance will reimburse you some of the costs of setting up a 501c3, either on your own or with an approved service. One such service is Charity Net USA. You will contact them, inform them you wish to set up a 501c3 and pay all up-front costs. Notify the HEMAA via email that you are starting the procedure, you will then submit the receipt and all required documentation to the HEMA Alliance via the form below, who will reimburse you according to our reimbursement plan below. It takes roughly 30 days for the service to take your information, file it correctly, and get a response from the federal government.
Remember, this reimbursement only covers part of the cost and setup costs will be more than the HEMAA offers.
Setup costs vary depending on your state and will range from $500-$1000. While expensive, once your affiliate is a 501c3, there are no yearly costs or fees with the federal government. Every state handles 501c3 filing differently, but the yearly costs are low.
The HEMA Alliance reimburses only a set amount of money and it is only available to affiliates that meet an age requirement.
0-1 Year- Not eligible
If you feel that you have extenuating circumstances and wish to be considered for reimbursement, you must reach out to the GC prior to starting the process.
2+ years - Up to $500
For covering the costs, the HEMAA will reimburse an initial $100 upon receiving receipt from Affiliate
The HEMAA will then reimburse $100 annually on the Affiliate’s membership renewal date
Example: Affiliate Z applies for 501c3 through Charity Net USA in March 2020. After paperwork is processed and payment is required, Affiliate Z will pay. Thereafter Affiliate Z requests reimbursement through the HEMAA by filling out the request for reimbursement form and emailing a copy of the receipt, proof of payment, and the approval letter. HEMAA will then process a $100 reimbursement. The Affiliate Z membership Club Affiliation Registration renews on August 26th. On August 27th, the Affiliate will send a screen shot of their TidyHQ renewal email to the HEMAA and fill out the request for reimbursement form (annually) for $100 reimbursement over the next 4 years until they have been reimbursed $500.
*If a new affiliate wishes to become a 501c3, they may do so at any time. However, they will only be eligible for reimbursement after two years of active and continued Club Affiliation Registration.
*If a long-standing affiliate has already gone through this process during the 2019/2020 GC term and will help us going forward by providing details of process in their state, they can submit a refund request to GC and we will consider reimbursement on a case-by-case basis.
This form is specifically for reporting purposes to the Board of Directors and to make sure that we are tracking reimbursement requests properly. If you wish to be reimbursed, you MUST fill out this form.