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Association FAQ

Want to learn more about associations and their role in society? Here some of the most frequently asked questions we receive about the association profession.

Q: What is an association?

A: The official definition from the IRS is: "In general, an association is a group of persons banded together for a specific purpose." That leaves a lot of room for interpretation, since associations are formed for an enormous variety of purposes and engage in a wide range of initiatives and activities, from proving networking opportunities for like minded people, to setting standards for industries and professions, to publishing magazines and providing adult education.

A sense of community coordination is at the heart of associations. People voluntarily join associations because they want to work together on a common cause or interest - be it the advancement of a profession, the cure for a disease, or the pursuit of a hobby. America's associations have deep roots in our history. The first American settlers formed "guilds," patterned after British traditions, to address common challenges and support each other's work and lifestyle. In 1830, French statesman and author Alexis de Tocqueville toured America and remarked that the new nation seemed to be succeeding so well at democracy because Americans of all ages, all stations of life, and all types of disposition were forming associations. In fact, both John Adams and Thomas Jefferson were the volunteer leaders of associations when they ran against each other for president.

This trend toward community coordination has shaped and advanced America since its birth and has historically set America apart from many other nations (although associations or "non-governmental organizations" are now growing in number internationally, as well). While the complexity of associations and their role has evolved, today's associations still share the purpose of coming together to produce positive results for their members and society.

The IRS establishes several technical qualifications for an association and the definition of an association can vary under state law. You may wish to consult the law of the state in which the organization is organized and an attorney if you are thinking of starting an association of your own.

Q: How many associations are there?

A: The short answer is, lots. And the number keeps growing every year. To get a better handle on the exact number, it is helpful to distinguish the types of associations represented by ASAE members from the overall tax-exempt community, which numbers close to 1.8 million in the U.S. alone.

ASAE members primarily represent trade associations, and individual membership organizations or professional societies, organized under Section 501(c)(6) of the tax code; and philanthropic organizations, organized under Section 501(c)(3). In 2004, there were an estimated 86,054 trade and professional associations. These organizations include local, state, regional, national and international associations. A number of these are independently incorporated chapters or allied organizations of larger associations.

Add to that an estimated 1,010,365 philanthropic or charitable organizations and you begin to get an idea of the scope of the non-profit community nationwide.

Q: Why are associations tax-exempt?

A: The first integrated federal income tax statute, enacted in 1913, provided exemptions for business leagues, as many associations were known at that time. The 1913 Act also provided exemptions for charitable, scientific, and educational organizations. Congress first gave associations favored tax treatment largely in recognition of the benefit the public derives from their activities. The exemption was based upon the theory that the government is compensated for any loss of tax revenue by its relief from the financial burden that would otherwise have to be met through appropriating public funds. In simple terms, associations earn their exempt status by meeting many of the needs of their members and the general public that the government would otherwise have to meet.

As tax-exempt entities, associations are barred from accumulating equity appreciation for private benefit. Instead, these organizations undertake programs or initiatives to benefit members and the public rather than private individuals. Their earnings, therefore, must be dedicated to furthering the primary purpose for which they were organized.

Q: How do associations benefit their members?

A: Associations are organized for all types of purposes, but there are some recurring benefits they typically provide their members, including:

• Education/professional development
• Information, research, statistics
• Standards, codes of ethics, certification
• A forum to discuss common problems and solutions
• Opportunities to further a specific mission, including volunteering and community service
• Providing a community of interest.

Q: How do associations benefit society?

A: Although they are membership organizations, many of the contributions made by associations today are enormously beneficial to society as a whole.

Hundreds of national, state, and local associations coordinate assistance to individuals and families in times of natural disaster or urgent need. Others write product standards for everything from children's toys to airline and traffic safety. Still more invest millions of dollars to advance the post-college professional training of our nation's workforce. With their membership networks and communication vehicles, associations are uniquely prepared to respond with aid when America needs them most. A community of varied interests and missions, associations tend to move with one purpose in moments of crises. The outshoot of many of the community service initiatives started by associations is that they encourage volunteerism. By logging nearly 200 million volunteer hours in community service each year, associations empower people to get involved in issues that affect their communities, their professions, and their quality of life.

Q: What sort of career opportunities do associations offer?

A: As employers, associations require numerous skill sets to effectively serve their members. There are career opportunities in traditional fields like finance and accounting, marketing, advertising, communications and public relations, government relations, legal, and information technology, and in industry-specific areas like membership marketing, foundation grant-writing, event planning, and trade show management. Because of the breadth and diversity of the profession, there is something of interest for most people. Associations offer competitive salaries and benefits, as well as a rewarding higher purpose.

Associations have a responsibility to achieve results, not only for their members but for society at large. Believing in the mission of an organization is a powerful incentive, and a great reason to go to work everyday.

Visit www.CareerHQ.org to research career opportunities in associations, or learn more about the profession by exploring this website.

Q: What is the role or connection between ASAE & The Center for Association Leadership, and the association community at large?

A: ASAE & The Center for Association Leadership are two organizations linked together by a belief that associations have the power to transform society for the better. ASAE is the association profession's principal voice and membership organization, with over 23,000 members. The Center for Association Leadership is the premier provider of learning and knowledge for the association community. Together, they serve approximately 10,000 associations that represent more than 287 million people and organizations worldwide. Learn more about ASAE and the Center in the About Us section of this website.