I don’t know of any reason why there should be an absolute prohibition on a 501(c)(3) nonprofit literary magazine publishing work by its officers or directors.  The idea may have come from the Internal Revenue Service denial of exemption for cooperative art galleries that it ruled were primarily for the benefit of the member artists and not for the benefit of the general public.  Conceivably, if the magazine published only the work of its officers, the IRS might conclude that it was being run for private benefit rather than public benefit.  But if it also has a whole range of authors unaffiliated with the organization, that should not be an issue.  I would ask those who are saying you can’t publish officers’ works for a citation of authority. If they come up with something, please let me know. I don’t think they will.