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Old 06-20-2019, 04:44 PM
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Mary Pat Campbell
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Default Proposal to change the SOA to 501(c)(6) org

https://www.soa.org/programs/electio...bylaws-change/

Quote:
Proposed Bylaws Changes
The Society of Actuaries (SOA) proposes a legal structure change to create a new not-for-profit corporation 501(c)(6) with the Society of Actuaries name in promoting the actuarial profession. The current SOA 501(c)(3) will be renamed the Society of Actuaries Research Institute, a controlled affiliate of the SOA. The SOA Bylaws require a vote of the Fellows (FSAs) to approve the amendments necessary to adjust the current 501(c)(3) entity in conjunction with the simultaneous creation of the new 501(c)(6) entity.

Read the letter from SOA President James Glickman, announcing this proposed change.

Stay tuned for further updates on the legal structure change and the Bylaws vote. The SOA will have a webcast on July 11 at noon Eastern to discuss these changes. Email questions to membercomms@soa.org.
FAQ

https://www.soa.org/programs/electio...ws-change-faq/

So...this is totally to supersede the Academy, isn't it.
https://projects.propublica.org/nonp...ions/366142798
Quote:
AMERICAN ACADEMY OF ACTUARIES
1850 M ST NW STE 300, WASHINGTON, DC 20036-5805 | TAX-EXEMPT SINCE NOV. 1966
EIN: 36-6142798
Nonprofit Tax Code Designation: 501(c)(6)
Defined as: Business leagues, chambers of commerce, real estate boards, etc, created for the improvement of business conditions.
Donations to this organization are not tax deductible.
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Old 06-20-2019, 04:53 PM
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Mary Pat Campbell
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From email:

Quote:
Proposed Amendments to SOA Bylaws
Greetings,

The SOA has historically operated as a non-profit organization under Section 501(c)(3) of the Internal Revenue Code, because of its mission and long history of advancing actuarial science through education and research. Many other professional membership societies are organized as 501(c)(6) entities.

During our discussions last year regarding a potential association combination, we recognized that it would be advantageous to have a legal structure combining both types of entities under the control of a common board and management framework. This structure (of having 501(c)(3) and 501(c)(6) entities working under unified management to achieve unique purposes) is very common among U.S. professional membership associations.

After carefully reviewing this issue, the SOA Board of Directors will be asking Fellows to approve an amendment to the SOA bylaws to create this legal structure, which I'll address in more detail below. This amendment will be offered for consideration by the Fellows during this year's SOA elections and voting.
Background
First, let me provide some background about non-profit organizations as defined in the Internal Revenue Code. Both "501(c)(3)," which is the SOA's current designation, and "501(c)(6)," which is the designation of many other professional membership societies (including all other U.S.-based actuarial organizations), refer to sections of the Internal Revenue Code that allow federal income tax exemptions for types of nonprofit organizations.

The 501(c)(3) exemption is intended to be used by educational, scientific and research organizations that provide a public benefit through advancing knowledge and public awareness of a particular field. The 501(c)(6) exemption is intended to be used by professional or industry associations, which may do all of the above, but which also serve to advance the common professional interests of their individual or institutional members.

The SOA is committed to advancing actuaries as leaders and to promoting the profession. It is an increasingly important part of our mission to ensure the public understands the value that actuaries bring to markets and the public. Our members have repeatedly emphasized to us the importance of this goal. We believe the IRS regards these activities as most appropriate to be carried out by a 501(c)(6) qualified entity. On the other hand, our commitment to the advancement of actuarial knowledge through education and research and to benefit the public are still very appropriate purposes for a 501(c)(3). Thus, after completing additional research, it has become clear to the Board of Directors that a better governance approach to support our future mission and activities is to restructure the SOA as a 501(c)(6) organization, with a controlled affiliate organization committed to research and education and remaining a 501(c)(3).

The SOA Board of Directors has recently decided to propose a change to our organization's legal structure and tax-exempt status to accomplish this. We will be asking all Fellows of the SOA to approve the plan and the necessary Bylaw amendments that will create a new 501(c)(6) not-for-profit corporation, which will adopt the current Society of Actuaries name. Our existing 501(c)(3) not-for-profit entity will then be renamed the Society of Actuaries Research Institute and will be a controlled affiliate of the new SOA.
What Does This Mean for You?
These changes will not have any impact on you, as your designations, membership status, and access to SOA resources will all remain the same. Your membership status will be maintained under the 501(c)(6) organization, and the Bylaws of this new "SOA" entity will be identical to the current ones under which we operate today. We will continue to operate as a single enterprise under wholly common governance (same board for both) and management to advance our mission to promote actuaries and the actuarial profession. To modify the legal structure, the SOA Bylaws require a vote of the Fellows to approve certain changes:
Approve an amendment to our existing Articles of Incorporation, restating its purpose and changing its name to the Society of Actuaries Research Institute.
Adopt new Bylaws for the renamed 501(c)(3) entity.
The newly formed 501(c)(6) entity will then simultaneously adopt the Society of Actuaries name and the same Bylaws under which we operate today.
The SOA Bylaws require approval of these changes by a two-thirds majority of voting Fellows, or by at least 10% of all Fellows, whichever is greater. This process also requires IRS approval of 501(c)(6) tax-exempt status for the newly-created entity. Once approved, we plan to have the changes take effect on or before January 1, 2020.

As a next step, we encourage you to review additional information, including an initial set of FAQs and to send any questions you may have to membercomms@soa.org. I hope you will participate in upcoming informational webinars we will be holding on the proposed changes – stay tuned for an email invitation. During the 2019 election Aug. 19 - Sept. 6, we need Fellows' help in voting for these changes and amendments to the SOA Bylaws. We thank you in advance for your participation!

Sincerely,

James M. Glickman
SOA President
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Old 06-20-2019, 05:25 PM
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Any reasons to vote against this?
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Old 06-20-2019, 05:38 PM
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Originally Posted by career changer 2 View Post
Any reasons to vote against this?
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Originally Posted by Kenny View Post
About to initiate a hostile takeover of the AAA, imo.
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Old 06-20-2019, 05:56 PM
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Yup, I agree.

I sent the following question:

Quote:
It was not clear to me from the Q&A given here:

https://www.soa.org/programs/electio...ws-change-faq/

What can the SOA do as a 501(c)(6) that it cannot currently do as a 501(c)(3) organization?
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Old 06-20-2019, 06:01 PM
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From a now-locked thread on the same topic
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Originally Posted by working girl View Post
I looked up the difference between the two types of organizations, and am trying to understand what they alluded to in the first paragraph (I also am ineligible to vote). It must be something political? I don't know enough about it, but it sounded like they wanted to combine with other organizations, would it be easier if they both had the same IRS status? Maybe I'm just reading too much into it like they are trying to do something underhand.

Found this online:

As you can see, there are benefits to both 501(c)(3) status and 501(c)(6) status. A company with 501(c)(3) status enjoys the benefits of tax exemption, and fundraising may be easier since donations are deductible from the taxes of donors as well. Even the value of donated goods can be deducted, as long as a receipt is provided to show the approximate value of the items in case the IRS questions the donations. For public charities and other nonprofit organizations that serve the community they exist in, 501(c)(3) status is the goal to try and reach.


For companies that serve the businesses in their community or that represent an entire class of businesses, however, it doesn't make sense to try for 501(c)(3) status. Instead, 501(c)(6) status provides many of the same benefits while still allowing the company to be politically active on its members' behalf. Donations to the business aren't deductible, but these companies also receive significantly fewer donations than public charities, so this shouldn't be a point that makes or breaks the decision to apply for nonprofit status.
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Old 06-20-2019, 06:19 PM
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Mary Pat Campbell
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I am fine with 501(c)(6) status for the SOA, fwiw.

I will be voting for this change.

That said, I think that they need to be clear on the distinctions between what the SOA can do under the 501(c)(6) status and 501(c)(3) status.
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Old 06-20-2019, 07:05 PM
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Quote:
Originally Posted by campbell View Post
That said, I think that they need to be clear on the distinctions between what the SOA can do under the 501(c)(6) status and 501(c)(3) status.
FWIW the key differences between 501(c)(3) and 501(c)(6) appear to be:
  • Contributions to 501(c)(3) organizations are generally tax-deductible; dues for 501(c)(6) entities are deductible only if they serve an "ordinary and necessary" purpose for the dues-payer
  • 501(c)(3) organizations are generally exempt from paying state and local sales taxes. 501(c)(6) organizations are not.
  • 501(c)(3) organizations are severely restricted in their ability to legally engage in lobbying or other political activities. 501(c)(6) are fairly free in this regard, although they must disclose to members what portion of their dues are going towards such activities.

The CAS is a 501(c)(6) organization.

It might be tempting for a cynic to jump on the "lobbying" point...but I think Occam would suggest that the SOA simply discovered (perhaps as a result of the failed merger talks?) and is seeking to resolve an error.

Last edited by Maphisto's Sidekick; 06-20-2019 at 07:08 PM..
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Old 06-20-2019, 07:26 PM
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Mary Pat Campbell
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Yes, I do actually know those items. I just want them to be explicit about it.

And no, this is not a new discovery on the part of the SOA (at least, according to my own conversations over the years).

I have no issue with the change, and as I said above, I will vote for this change. But I think they need to detail these for the membership rather than saying "Sure, we -could- lobby, but we're not going to lobby!"

If that were the case, we wouldn't need to change status.
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Old 06-21-2019, 09:46 AM
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Will someone smarter than me please summarize the positive and negative outcomes from the status of this bylaw change that is being introduced by the SOA leadership to move from a not for profit status to a different not for profit status?
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