Even though they are nonprofit organizations, associations are permitted to generate income and still retain their nonprofit status. As nonprofit organizations, what associations are barred from doing is distributing their profits to individuals who control the organizations. Associations with a nonprofit status have elected to undertake programs to benefit members and the public rather than private individuals. By law, their profits must be dedicated to furthering the purposes for which they were organized. All earnings must be "reinvested" in the organization.

What does tax exemption mean? Tax-exempt status means that an organization is exempt from paying federal corporate income tax on income generated from activities tied to the purposes for which the organization was formed. The association must pay federal corporate income tax on income that is not related to its purposes. They also must pay a variety of other taxes, such as payroll and real estate taxes.

Why all this talk about taxes? Think about it. How many organizations within the United States are given such freedom to use their funds to passionately promote their cause and educate the public? Apart from educational institutions, associations are the foremost way to become skilled on a subject. And in a profession like architecture, oftentimes the best lessons are learned outside of school, from those people practicing and furthering the profession every day in trade, professional and manufacturing associations.

Each of these association types use similar communication techniques, such as annual meetings, Web sites, local chapters, annual shows and varied publications that must be explored on an individual association level.

Trade associations

A trade association is defined as an organization of business competitors, in a specific industry or business, that is interested primarily in the commercial promotion of products or services. Membership is usually held in the name of a business entity. The association's services may include business ethics, management practices, standardization, commercial (i.e., statistical) research, publication, promotion, and public relations. The basic tenet of many trade associations in the design and construction field, such as the National Electrical Contractors Association and the International Brotherhood of Electrical Workers (NECA-IBEW); the Westlake, Ohio-based Marble Institute of America (MIA); and the Purcellville, Va.-based National Terrazzo & Mosaic Association, Inc. (NTMA); is that there is strength in numbers.

That's certainly the case when promoting accepted practices. Trade associations are often the originating source for codes of ethics and professional and safety standards that govern a variety of professions. So if you want to save time and get that spec right, trade associations are key associations to call.

Take, for example, the NECA-IBEW. These two century-old organizations are dedicated to enhancing the electrical industry through continuing education, labor relations, current information and promotional activities. Backed by the high-quality workmanship provided by electricians and managers trained in the NECA-IBEW framework, NECA, together with a number of other associations in an ANSI-approved format − created and maintains the National Electrical Installation Standards (NEIS). The NEIS is dedicated to promoting higher standards and quality workmanship.

These standards go beyond the National Electrical Code, which is a life-safety code. First published in 1997, the NEIS is a voluntary performance standard that provides guidance as to the quality of the installation and workman-like practices. Although this requirement for installation of electrical products and systems in a "neat and workmanlike" manner appears in NEC Section 110-12 and six other places, according to NECA Executive Director H. Brook Stauffer, it isn't defined anywhere. NEIS does that.