Check out this page:
http://www.aact.org/start/index.html

It's an article from the American Association of Community Theater on how to start a theater company.

Dan

Melanie:

I think we all started out like you are. We were in operation for a year before we got our 501(c)(3). There are many copies of various Articles of Incorporation, By-laws and 5019c)(3) applications available on the net or from other theaters. Don't re-invent the wheel - use what others have done. I got copies from several theaters and picked out what I liked from each.

The first step is to come up with Articles of Incorporation and file as a non-profit corporation with your Secretary of State - that will likely cost less than $25. You really need the non-profit corporation to protect yourself.

Bylaws come next - where the Articles of Incorporation are pretty much boilerplate, the Bylaws cover how you will actually run your corporation and there are a lot of issues you need to address in drafting them: Will you have members or not? How many people on your Board of Directors? How will you elect Directors? And on and on. That is why you want to work from several sets of bylaws.

Then comes the 501(c)(3). It is really not difficult to fill out the forms. The hardest part is figuring out an annual budget for the next three years. (That is why we waited a year - to see what our budget would acually look like). If you anticipate total income of less than $10,000 a year, the cost of the filing is $150 - if over $10,000 the cost is $500. The only thing that 501(c)(3) status means is that donors can be assured that their donation will be tax deductible.

When we got started, I loaned the corporation $1,000 for operating capital to pay the expenses that had to be paid before our first production opened (like incorporation and royalties). The rest waited till after our run when we had money. (My wife agreed that we would cover any losses if necessary - but it wasn't). We made money on our first show and we continue to grow. We got our $1,000 back over two years without interest.

I don't want to minimiize the importance of your 501(c)(3) status - the big money - donors and grants - will insist on it - but don't let that drive you to dispair - I have found that you need a good track record before you will get any serious money from grants or donations anyway.

The important thing for you to focus on is quality productions. Quality, quality, quality. Someone (I think it was Mike Polo) said that it takes 5 to 10 great productions to erase the taint of one bad production. Make sure your group gets off on the right foot.

Finally, volunteers will come but not in great numbers until your group proves itself - no one wants to be part of a turkey. If you have five people, figure that you will have to do everything yourselves - then you will be surprised when the volunteers come.

Nothing is more exciting or rewarding than forming a new theater and watching it grow.

Thank you so much for all the info! Now, most of the confusion is gone and, I will be following your advice. It is very much appreciated...