Legal Question in Business Law in New Jersey

I just became President of our Jeep club. We have around 25 members. We did a show and earned some money. We have about $2000 in a private account and that will grow to about $3500 in the next month or so. My question is do we need a LLC or a NPO to protect us and would we need to have insurance! All our money goes to better the club. We use it to hold events and stuff like that. There is no cash dispersement to any members or board people.


Asked on 12/07/09, 2:06 pm

1 Answer from Attorneys
Ronald Cappuccio Ronald J. Cappuccio, J.D., LL.M.(Tax)

You need to set up a Not-For-Profit Corporation. If not, the entity is a partnership with every member having personal liability. Also, the club will have to file Federal and State Tax Returns and pay taxes.

Your club qualifies to be a non-profit organization for tax purposes. Frankly, it takes more work to set-up a not-for-profit corporation than a for-profit business.Here is an article about starting a NonProfit:

http://nonprofitesq.com/startinganonprofit.html

I hope this helps!

Ron Cappuccio

856 665-2121

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Answered on 12/12/09, 1:53 pm


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