Newly forming organizations will leverage IEEE-ISTO’s extensive experience in technical program formation, start-up, and management. Adhering to best industry practice, IEEE-ISTO has organizations up and running quickly and cost-effectively. We work closely with Member Programs to walk them through each step of the formation process and make all options available. For groups that are already formed but moving under the IEEE-ISTO legal umbrella, we ensure a smooth and seamless transition for new members.
Over 40 organizations have been formed and managed by IEEE-ISTO since its inception. IEEE-ISTO works closely with potential programs assessing their needs, proposing customized, scalable support packages in the form of a Statement of Work (SoW) that meets the specified needs of the new program. The time required to form or transition a new program into IEEE-ISTO, is dependent on several factors, and can take a few short weeks to several months depending on the program being formed/transitioned.
We at IEEE-ISTO recognize that starting a new organization or moving an existing organization into a new home is a significant undertaking that has the potential to be replete with many pitfalls if the roadblocks are not recognized. Rather than “figure it out” and run the risk of losing time, energy, and dollars, entrust IEEE-ISTO to put your organization in its care, and guide you through its meticulous, time-honed process of establishing an ideal foundation for the success of your group.
Non-profit Tax-exempt Status
Under the IEEE-ISTO structure, member programs enjoy the full protection of the IEEE-ISTO legal umbrella from the minute they sign a Participant Program Agreement (PPA). There are no filings, no applications, and no delays. Further, the member programs of IEEE-ISTO can leverage its extensive library of governance document templates. These not only speed the development of such documents, but often save thousands of dollars in legal expenses. Beyond filing for incorporation, a new organization also needs to file for tax exempt status with the IRS. Again, up-front this is a fairly benign process. But stakeholders of start-up associations should be very weary of this stage, for several reasons. First, obtaining an IRS ruling can take a long time (two years is not uncommon). During this time, associations are encouraged to build up a tax reserve in the event the association is denied tax exemption. For fledgling organizations, this funnels critical cash away from value-added activities.
Second, defense of an exempt filing can be costly and time consuming. It is not uncommon for a considerable amount of back-and-forth to occur between the IRS and the filing association before a ruling is made. Seeking advice from legal counsel during such exchanges is strongly advised. Further, the IRS may suggest structural changes to the filing organization, such that it may better comply with regulations.
Finally, gaining exempt status is far from a certainty. The IRS looks at trade association filings quite closely, to ensure they truly are for the benefit of the industry(s) which they serve versus for the benefit of the member companies involved. Denial of tax exemption can cripple an association.
Similar to the legal umbrella, under the IEEE-ISTO structure, member programs realize 501(c)(6) tax exempt status immediately and the benefits derived therefrom.
Like any organization, your association will require insurance coverage. The ease of your organization’s ability to acquire insurance, and its cost, will vary depending on the nature and scope of your association. However, due to the risk involved, some insurers will not offer E&O (errors and omissions) insurance to standards-based organizations. Member programs of IEEE-ISTO enjoy the benefits of full insurance coverage, including E&O, immediately upon executing the PPA. Equally important, IEEE-ISTO leverages its economies of scale to acquire extensive coverage.
Risk Aversion (legal protection)
Once a new program signs on with IEEE-ISTO, they are legally a protected entity operating under the IEEE-ISTO legal umbrella which defers any risk that would be borne by the program otherwise.