Do Nonprofit Board Members Get Paid?

Here’s a question that can spark some serious debate: should nonprofit board members get paid a salary? At first glance, it seems like the answer should be simple—nonprofit boards are volunteer-based, right? But hold on. The nonprofit world isn’t always black and white, and this is one of those gray areas where you’ve got to ask yourself: what’s really best for the organization? Before you jump to conclusions, let’s dig a little deeper into the pros, cons, and what it all really means for your nonprofit.

The Traditional View: No Pay, All Heart

Traditionally, nonprofit boards consist of volunteer board members who serve without compensation. And that’s for good reason. Serving on a board is supposed to be a labor of love, a way to give back to a cause you’re passionate about. It’s a role of stewardship, not a gig to make a quick buck or earn a board member salary.

Here’s the deal: the nonprofit sector thrives on people who are willing to give their time, talents, and yes, even treasure (we’re looking at you, fundraising duty). Paying board members could shift that dynamic. If you start cutting checks, does the motivation change? Are people still serving because they care, or because they’re looking for some extra income? These are real questions nonprofits wrestle with when considering whether to pay their boards.

The Case For Paying Board Members: Time Is Money

Now, let’s flip the script for a second. Nonprofit board members put in serious work—strategic planning, financial oversight, fundraising, hiring executive leadership. Sometimes, it feels like a part-time job. So why shouldn’t they get compensated with a board member salary for their time and effort?

Paying board members could attract highly qualified individuals who might otherwise pass on the opportunity because they simply can’t afford to be volunteer board members. In fact, some larger nonprofits with complex financial structures or significant fundraising goals do pay their board members. These organizations argue that it helps them recruit top-tier talent and keeps their boards engaged and accountable.

But here’s the kicker—if you pay board members, you’ve got to be really clear about what that means. Are you paying for their expertise? Their time? Their leadership? If you’re going to write a check, you’d better have crystal-clear expectations in place for the board member salary.

The IRS, State Laws, and All That Fun Legal Stuff

Of course, it wouldn’t be a nonprofit topic if we didn’t talk about regulations, right? Whether or not board members can receive a salary—and how much—varies depending on state laws and IRS regulations. The IRS doesn’t flat-out forbid nonprofits from paying board members, but it has some pretty strict rules about what’s considered “reasonable compensation.”

In plain English? If you’re paying board members, the amount has to be justifiable and not excessive. The IRS frowns upon paying nonprofit boards too much because, let’s face it, that’s money that could be going toward the mission. Plus, there’s always the risk of damaging the public’s trust. People want to know that their donations are going toward making a difference, not lining the pockets of board members with hefty salaries.

The Cons: Losing Sight of the Mission

Here’s a big concern that gets tossed around when you talk about paying nonprofit board members: mission drift. Will paying your board shift the focus from the cause to compensation? Nonprofits run on heart. They’re fueled by passion, dedication, and a deep commitment to solving real-world problems. There’s a worry that once you introduce financial compensation, you start running the risk of attracting folks who are in it for the wrong reasons rather than dedicated volunteer board members.

And then there’s the budget. Every dollar spent on board member salaries is a dollar not spent on programs, services, or staff. Can your nonprofit afford to pay board members, or is that money better used elsewhere? It’s a tough call, and one that has to be weighed carefully.

What’s Right For Your Nonprofit?

At the end of the day, there’s no one-size-fits-all answer to whether or not nonprofit board members should get paid. For some organizations, especially small grassroots groups, it would feel downright strange to offer board compensation. For larger organizations with complex structures and big budgets, paying board members might make sense.

The key is transparency. Whatever decision you make, it has to be above-board (pun intended). You’ve got to be clear about why you’re doing it, how much you’re paying, and what you expect in return. And, of course, you need to stay compliant with state laws and IRS guidelines regarding board member salaries.

My Two Cents

If you ask me, nonprofit board members should serve out of passion for the mission, often as volunteer board members. But I also get that sometimes, a nonprofit needs to compensate board members to attract the talent and expertise it needs to thrive. If you go the route of paying your board, make sure it’s done thoughtfully, legally, and with the nonprofit’s best interest at heart. After all, the mission is what matters most.

So, should nonprofit board members get paid? It depends. What works for one organization might not work for another. Just make sure that whatever you decide about board member salaries, it helps your nonprofit stay mission-driven, financially sound, and focused on doing good in the world. Because that’s why we’re all here, right?