The HDA working to become non-profit organization

It is an exciting time for our hobby, and another big step for the Hobby Distillers Association has been completed.  We have now registered as a non-profit organization in the state of Texas, and are working toward obtaining federal non-profit status!  What does this mean for the operation of the HDA and how does it affect us moving forward?  Read on to find out.

Firstly, what does it mean for the operation of the Association?  Honestly, not all that much.  When Brewhaus and Rick Morris originally started the Hobby Distiller’s Association it was run as a DBA (doing business as) under Brewhaus.  This was done for a few reasons.  It saves on costs, as setting up a DBA is very inexpensive, as it is just a name registration, but no incorporation costs.  It also allowed the HDA to operate as a regular business, which carried no restrictions on lobbying or other activities.  Given that we employed a lobbyist at that time to push for legalization, this was a huge factor in our decision.  It also allowed Brewhaus to carry extra weight when funds ran low (which Brewhaus did, to the tune of around $80,000, as they did not receive much financial support from the other manufacturers or resellers).  It was intended to be operated as a non-profit arm of Brewhaus, but ended up being a substantial cost, instead.

So, if the Hobby Distillers Association was being operated as a separate piece of Brewhaus, why change it now?  We all know about the lawsuit at this point, and the ruling in the Association’s favor.  Although this fight is surely far from over (the government still has time as of this writing to appeal the decision), we know that this thrust the HDA into the position as the leader in the legalization effort.  We were before, but now there is much more expected of us going forward.  There is far more work ahead of us, even if the government does not appeal or we win the final round, be that at the appellate level or at the Supreme Court.  This could mean employing legal counsel at times, lobbying in certain states or at the federal level (to get given equal rights as those enjoyed by home beer and wine makers), or a host of other costs.  There is a lot to do yet, and we know that the HDA needs to be a fully operational business at this point.

What does this mean to you?  Once we are approved federally as a non-profit organization, does that make membership fees tax-deductible?  Unfortunately, no.  We are indeed working to become a non-profit organization, but we are not a charity.  Only donations and fees paid to a charity (501(c)3) are tax-deductible.  What it does mean is that the HDA would not pay federal or state income tax on the monies we bring in, leaving 100% of it available to be used for operating the association.  This means that your membership fees and donations are not having 20%-25% chopped off the top in tax, which will be a huge benefit for us moving forward.

We are excited about this move forward for the HDA, and are looking forward to continuing to lead us all in the effort to legalize home hobby distilling in America.