24.03A.150  <<  24.03A.155 >>   24.03A.160

Distributions prohibited. (Effective January 1, 2022.)

(1) A nonprofit corporation shall not distribute any property held for charitable purposes to its members, directors, officers, or other persons who are in a position to exercise substantial influence over the affairs of the corporation, except:
(a) As permitted under RCW 24.03A.160;
(b) To another entity that is a charitable corporation or is organized and operated exclusively for one or more charitable purposes; or
(c) To the federal government, a tribal government, or a state or local government for a public purpose.
(2) A nonprofit corporation shall not pay dividends or make distributions of any part of its assets, income, or profits to its members, directors, officers, or other persons who are in a position to exercise substantial influence over the affairs of the corporation, except as permitted under:
(a) Subsection (1)(b) or (c) of this section;
(b) Subsection (3) of this section;
(c) RCW 24.03A.160; or
(d) RCW 24.03A.906.
(3) A nonprofit corporation other than a charitable corporation may confer benefits upon or make transfers to members or nonmembers in conformity with its purposes, repurchase its memberships only to the extent provided in RCW 24.03A.380, or repay capital contributions, subject to the following conditions:
(a) Property held for charitable purposes may not be used to confer benefits upon or make transfers to members or nonmembers, repurchase memberships, or repay capital contributions;
(b) The nonprofit corporation may not be insolvent, and conferral of benefits, making of transfers, repurchase of memberships, or repayment of capital contributions shall not render the corporation insolvent or unable to carry out its purposes; and
(c) The fair value of the corporation's assets remaining after the conferring of benefits, making of transfers, repurchase, or repayment must be sufficient to meet the corporation's liabilities.

NOTES:

Effective date2021 c 176: See note following RCW 24.03A.005.
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