To C3 or not to C3? Why an association might consider the creation of a “C3 arm”

First, you might ask, what the heck do you mean by C3?! In the world of non-profit tax code, the IRS makes a distinction between different types of non-profits and the associated tax benefits through the classification of type of activities and missions the organizations support. Simply put, the differences are generally as follows: a 501 (c)(3) is the most common and focuses on solving a social issue that can benefit society as a whole; 501 (c)(5)s are labor unions; 501 (c)(8)s are fraternal societies; 501 (c)(13)s are cemeteries; and so on. Each one has a different relationship with the IRS and different tax-related benefits. The Contra Costa County Bar Association is a 501 (c)(6) with a mission to promote the interest of a specific industry or profession.

OK, you may further be pondering, but as a C6 association, the CCCBA raises money, provides scholarships, gets sponsorships, does pro bono work, and all sorts of activities to benefit our community as a whole, so why might CCCBA consider a C3 arm? The creation of a C3 arm is about being practical, efficient, and effective. Though C6 organizations do the charitable-type work as noted above, they are limited by the C6 designation. Donated funds are not considered charitable by the IRS, the CCCBA does not qualify for grants or funding opportunities, the work that we do is not often recognized as charitable by the community, and the opportunity to collaborate fully as a partner with like community-based organizations is severely limited, etc. The creation of a C3 arm would address these issues and would allow us to concurrently do the following:

Raise the Bar Association Profile in the Community

Many people view lawyers and the legal system as intimidating and unapproachable. By establishing a C3 arm, the bar association can demonstrate its commitment to the community and build trust with local residents. A legal clinic, for example, could provide a visible and tangible way for the bar association to make a difference in the lives of local residents. By helping people with legal issues, the CCCBA can build trust and goodwill with the community. The bar association can also use the legal clinic and other activities of the C3 arm to showcase the expertise of its members and demonstrate the value of the legal profession.

Demonstrate a Commitment to Serving the Community

By providing legal services to undeserved communities and supporting other charitable organizations with the same mission, the CCCBA can demonstrate that it is more than what is often perceived as just a professional organization focused on advancing the interests of lawyers. This commitment to social responsibility and community service can enhance the bar association’s reputation and increase its visibility.

A C3 arm would allow the bar association to support other charitable organizations in the community. Many bar associations are already involved in charitable activities, such as food drives and toy drives. By establishing a C3 arm, the CCCBA can expand its charitable activities and provide support to other organizations that are working to address important social issues.

Expand Fundraising Opportunities

501(c)(6) organizations are limited in their ability to fundraise as contributions are not considered ‘charitable’ (or tax deductible) by the IRS. However, donations to C3 organizations are considered charitable. Further, the C3 can apply for grants from foundations and government agencies, which can provide significant funding for their charitable activities. This can allow the organization to carry out more ambitious projects and have a greater impact on the community.

Attract New Members

Many lawyers are looking for ways to give back to their communities and make a difference. By establishing a C3 and providing opportunities for lawyers to volunteer their time and expertise, the bar association can attract lawyers who are passionate about making a difference in the community. This can help to diversify the bar association’s membership and attract new members who are committed to its values and goals.

What Would this Mean to the CCCBA?

Quite simply and immediately, creating a C3 arm for CCCBA would open the door to generating more donations, support and engagement from the local community. Since we already do a number of projects and programs that are considered charitable, we could build on our current successes, collaborate more effectively with our community partners and provide more opportunities for our members to engage in Pro Bono activities.

In conclusion, creating a C3 charitable organization as an “arm” of our bar association can enhance our reputation and visibility in numerous ways. By demonstrating our commitment to the community, providing legal services to underserved populations, and supporting other charitable organizations, the bar association can build trust and goodwill with the community. The legal services provided by the C3 can also help to raise the bar association’s profile, attract new members, and increase its influence in the political and legal spheres. Overall, establishing a C3 can be a powerful tool for promoting the bar association’s values and goals, and for making a positive impact on the community it serves.

Our Board of Directors is weighing the options of establishing a C3 arm.CCCBA members are encouraged to share their thoughts on this move, and/or attend the next board meeting on the first Wednesday of every month except August and December.