1. Except as otherwise provided in subsection 2, an unincorporated nonprofit association may not pay dividends or make distributions to a member or manager.

Terms Used In Iowa Code 501B.26

  • association: means an unincorporated organization consisting of two or more members joined under an agreement that is oral, in a record, or implied from conduct, for one or more common, nonprofit purposes. See Iowa Code 501B.2
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Governing principles: includes any amendment or restatement of the agreements constituting the governing principles. See Iowa Code 501B.2
  • Manager: means a person that is responsible, alone or in concert with others, for the management of an unincorporated nonprofit association and includes but is not limited to persons who may be designated as directors and officers or some other designation indicating that such persons would perform the duties of a manager. See Iowa Code 501B.2
  • Member: means a person that, under the governing principles, may participate in the selection of persons authorized to manage the affairs of the unincorporated nonprofit association or in the development of the policies and activities of the association. See Iowa Code 501B.2
  • property: includes personal and real property. See Iowa Code 4.1
 2. An unincorporated nonprofit association may do any of the following:

 a. Pay reasonable compensation or reimburse reasonable expenses to a member or manager for services rendered.
 b. Confer benefits on a member or manager in conformity with its nonprofit purposes.
 c. Repurchase a membership and repay a capital contribution made by a member to the extent authorized by its governing principles.
 d. Make distributions of property to members upon winding up and termination to the extent permitted by section 501B.29.
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