USPS® REVISED POLICY REGARDING SQUADRON AUXILIARIES

(Approved by the Governing Board, 12 September 1987)

The increasing costs of insurance and the new tax bill have caused careful reexamination of many USPS activities. Insurance premiums are based, in great part, on two major considerations - the number of members covered and the activities expected and covered. The new tax bill specifies what deductions a taxpayer may take for contributions to and on behalf of 501( c ) 3 organizations.

Questions as to whether or not auxiliaries are covered by USPS' blanket insurance policy and if work for an auxiliary entitles one to take a tax deduction have been raised. To properly assess the risks inherent in including auxiliary activities in the insurance coverage, we must know the number and location of the auxiliaries, the number of members of the auxiliaries and the activities usually undertaken by those auxiliaries. We can not rely on the phrase "engaged in authorized USPS activities" in an attempt to provide insurance coverage for the auxiliaries with out knowing what is involved, nor do we want to review each auxiliary activity one-by-one. In order to extend 501( c ) 3 "tax deduction" privileges to auxiliary members, we must submit a list of auxiliaries to the Internal Revenue Service annually.

Because of a lack of information, we started over from "ground zero" last year.

Except as modified by the following, the statements and procedures regarding auxiliaries set forth in section 6.02 of the Operations Manual are hereby reaffirmed.

Any squadron which has or desires to have an auxiliary should submit the following to the Auxiliary Advisory Committee in order for the auxiliary to be a "recognized auxiliary".

  1. A copy of the application to the squadron executive committee to form or authorize an auxiliary, and the approval by the squadron executive committee of such application.
  2. An agreement by the squadron that its recognition and "sponsorship" of the auxiliary will be revoked if the auxiliary engages in any program or activity or adopts any bylaws or policy which is contrary to the policies and best interests of USPS.
  3. A copy of the bylaws (or proposed bylaws) of the auxiliary containing a statement that the auxiliary recognizes the authority of USPS to revoke recognition of the auxiliary if the auxiliary engages in any program or activity in which a squadron may not engage or the auxiliary engages in any program or policy which is contrary to the policies and best interests of USPS ("Model Bylaws for Auxiliaries of Squadrons of the United States Power Squadrons" are available from the Auxiliary Advisory Committee); and
  4. A list of the general activities engaged in by the auxiliary or participated in by auxiliary members as a group, which list shall be up-dated and filed with the Auxiliary Advisory Committee annually.
Upon receipt of the foregoing, the Auxiliary Advisory Committee will review the submission and, if all is found to be in order, so advise the squadron and add the name of the auxiliary to the list to be submitted to the IRS. For those squadrons which have had an auxiliary for a long time, copies of the pre-existing documentation may be submitted.

Questions such as "should an auxiliary apply for tax exemption," should an auxiliary incorporate," and "should an auxiliary have its own insurance" cannot be answered on a general, nationwide basis. Each auxiliary should investigate the many ramifications of such questions under the laws of their state and make their own decisions (squadron law officer may be of some assistance). It is the current position of the National Law Officer that auxiliaries should neither incorporate nor apply for tax exemption on their own.

 Auxiliaries may not do anything which a squadron may not do directly - and while auxiliary members may participate in activities outside the scope of USPS, e.g. teaching in schools and teaching other than USPS educational courses if such subjects have been reviewed by the USPS Education Department and approved by the Operating Committee, they may participate in any other activities only as individuals, not as an organized auxiliary activity, just as squadron members may participate in other activities as individuals but not as members of a squadron. Auxiliary members should not represent themselves as being "experts" or "experienced" simply because of their auxiliary membership, or wear any auxiliary uniform, blazer, or other distinctive clothing while participating in unauthorized outside activities which might give the impression they were engaging in such activities as members of the auxiliary.

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