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Nonprofit Law/501 c 3 are we compliant


I belong to a cheer leading booster club that fundraises for its individual members. Is it legal to do all individual fundraising? Ex. Coin drops 10 people do a coin drop they split the money 12 ways with a share going to to each member that participated 1 share going to the booster officer that set it up and another one going to the club to pay for ins. Every other fundraiser we do gets split among the member that did it and booster club for ins and expenses.  It has come to our attention that 1) officers can not get compensated for the time it takes to set up a fundraiser be it a coin drop or cookie dough 2) most fundraising can not go to individual fundraising accounts.   How do you split fundraising up when only a few people do it?  The ultimate purpose is to benefit themselves.  The funds in the IFA go to pay for competition fees and choreography for the individual.   To me this is a blatant misuse of a 501 c 3.

My summary of IRS regulations relating to 501c3 booster organizations is at -- you may be interested to read that. You will see details that indicate that the fundraising for the individuals participating. But I don't know where you got that officers can not be compensated a reasonable amount for their work.  If you send me the url I will reply further.

After you read my summary, if you have any follow-up, let me know.

Harvey Mechanic, Attorney at Law -

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.  

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Harvey Mechanic


DO NOT GIVE ME INFORMATION THAT YOU WANT KEPT CONFIDENTIAL. I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "" without the quotes and then add your search terms before hitting enter.


I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.


B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.

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