A 501(c)(6) organization is a type of nonprofit organization in the United States classified under section 501(c)(6) of the Internal Revenue Code (IRC). This classification applies to business leagues, chambers of commerce, real estate boards, boards oftrade, and professional football leagues, provided they are not organized for profit and no part of their net earnings benefits any private shareholder or individual. These organizations are designed to promote the common business interest and improve business conditions in their respective sectors. ^[1]

• Nonprofit Status: 501(c)(6) organizations are considered non-profit entities and are exempt from federal income tax.
• Purpose: The primary purpose of these organizations is to promote the common business interests of their members. They can engage in various activities, including lobbying and political campaigns, as long as these activities are aligned with their mission.
• Members: These organizations typically have a membership base, which can consist of individuals, businesses, or other entities in the same industry or profession.

• Tax Exemption: Contributions to 501(c)(6) organizations are generally not tax-deductible as charitable donations. However, dues and fees paid by members may be deductible as business expenses.
• Unrelated Business Income: Similar to other tax-exempt organizations, 501(c)(6) entities may be subject to tax on income derived from activities unrelated to their exempt purpose. ^[2]

501(c)(6) organizations often engage in activities such as:

• Advocacy and Lobbying: They may represent the interests of their members in legislative and regulatory matters.
• Networking and Events: Organizing conferences, workshops, and networking events for members.
• Education and Training: Providing educational resources, training, and certification programs for industry professionals.

Some well-known examples of 501(c)(6) organizations include:

• U.S. Chamber of Commerce: A national organization representing the interests of businesses and industries in the United States.
• ABA: A professional association for lawyers and law students in the United States.
• BBB: A network of local nonprofit organizations focused on advancing marketplace trust by accrediting businesses that adhere to ethical standards and resolving consumer complaints.

To qualify for 501(c)(6) status, an organization must meet specific requirements set by the IRS, including being organized for a qualifying purpose, not being operated for profit, and ensuring that no part of its net earnings benefits private individuals. The organization must also file annual information returns with the IRS, typically using Form 990.