Life Cycle of a Business League (Trade Association) - Starting Out
The first stage in the life cycle of any organization is its creation. A nonprofit organization may be created as a corporation, a trust, or an unincorporated association. Any of these entities may qualify for exemption. Note, however, that a partnership generally may not qualify.
To qualify for exemption as a business league under section 501(c)(6) of the Internal Revenue Code, an organization must be an association of persons having a common business interest, whose purpose is to promote the common business interest and not to engage in a regular business of a kind ordinarily carried on for profit. Its activities must be directed to improving business conditions of one or more lines of business rather than performing particular services for individual persons.