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RD as a non-profit, 501c3

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  • Richard Campbell
    Salvete! I ve been going over the process for creating a Federally tax exempt non-profit, otherwise known as a 501c3 organization, and there really are what I
    Message 1 of 4 , Nov 2, 2009
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      Salvete!

      I've been going over the process for creating a Federally tax exempt non-profit, otherwise known as a 501c3 organization, and there really are what I see as important decisions that have to be made vis a vis an organization. The IRS organizational test for what is a 501c3 comes down to four main categories:

      charitable
      religious
      Scientific
      Educational

      of which roman living history to me falls in the last category: an example of activities being something like
      "conducting public discussion groups, panels, lectures and workshops" or
      "a museum, zoo, planetarium, symphony, orchestra or performance group" seems to fit particularly in our interaction with schools and the public. Educational further goes on to say 501c3 educational definitions are broad, for self development and for the benefit of the community. Politics are definitely forbidden.

      You can't be educational AND social or recreational as that is 501c7. Those latter seem to fit the LAFE sort of activity.

      The mission statement then, to qualify, means that the focus has to be open and on educating the public over a closed event like LAFE. I just wanted to point out these distinctions as I understand them as this focus would be come a determining factor.

      This would make RD more of a style than a particular event. RD could sponsor a display at the Celtic Festivals and some of the expenses for participation and I think for equipment would be deductible. Matt does this already for Maryland tax exemption as Legio XX is MD tax exempt, but not Federal tax exampt.  There would have to be a board with minutes and public records kept, and the board would decide on RD directions and participation.

      I"m going to draft the mission statement and will circulate it for comment. We'll have to discuss board membership and financial responsibilities later on, but if you have experiences with this let the group know.

      Richard
    • rotmistrzb
      Speaking as someone who went through the paperwork process and then opted out... consider the benefits and costs of 501c3 vs just a regular private nonprofit.
      Message 2 of 4 , Nov 3, 2009
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        Speaking as someone who went through the paperwork process and then opted out...
        consider the benefits and costs of 501c3 vs just a regular private nonprofit. On the downside, there is a fairly heavy additional recordkeeping and reporting responsibility. on the upside, there is tax deductibility, and maybe some additional public creditability.

        When I looked at it, I had to ask myself... is this going to be a fund raising organization? Becuase I calculated that if I did not get at least close to an extra $1000 dollars per year in contributions and donations, it (the extra annual paperwork) was just not going to be worth it. My answer in my case was no, there may be some incidental donations but fund raising is not the interest or point.

        So we (Sienkiewicz Society) went with a private non-profit corp. to provide legal liability protection for events, as our insurance purchasing entity, and so on. The organization can accept donations from the public, but these *must not* be described as tax deductable donations.

        (However, a grey area and you may want to consult a tax attorney, I believe that insiders (officers and core members) can donate to the organization... in fact anyone can to any non-profit even ones not registered with the IRS.... and legally deduct on their taxes. In effect, the 501 C designation is a guarantee that the IRS will accept the tax deductibility of the donation and gives the Organization permission to advertise that, but is technically not necessary for legal deductibility. The risk is that this may be challenged in an IRS audit, but it should be defensible if the org is functioning as an educational non-profit. This was explained to me by someone whom I trust to know about tax law....I personally don't do this and I don't donate enough to the Society to really make an increased audit risk worth while, but I believe I could. )

        -Rick
      • Richard Campbell
        Dan has forwarded the docs from his organization which is 501c3, so we can start a discussion at fabrica this Saturday. ... Received: Mon, 02 Nov 2009 10:21:29
        Message 3 of 4 , Nov 3, 2009
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          Dan has forwarded the docs from his organization which is 501c3, so we can start a discussion at fabrica this Saturday.


          ------ Original Message ------
          Received: Mon, 02 Nov 2009 10:21:29 PM EST
          From: "Richard Campbell" <richsc@...>
          To: <romandays@yahoogroups.com>
          Subject: [romandays] RD as a non-profit, 501c3


           

          Salvete!

          I've been going over the process for creating a Federally tax exempt non-profit, otherwise known as a 501c3 organization, and there really are what I see as important decisions that have to be made vis a vis an organization. The IRS organizational test for what is a 501c3 comes down to four main categories:

          charitable
          religious
          Scientific
          Educational

          of which roman living history to me falls in the last category: an example of activities being something like
          "conducting public discussion groups, panels, lectures and workshops" or
          "a museum, zoo, planetarium, symphony, orchestra or performance group" seems to fit particularly in our interaction with schools and the public. Educational further goes on to say 501c3 educational definitions are broad, for self development and for the benefit of the community. Politics are definitely forbidden.

          You can't be educational AND social or recreational as that is 501c7. Those latter seem to fit the LAFE sort of activity.

          The mission statement then, to qualify, means that the focus has to be open and on educating the public over a closed event like LAFE. I just wanted to point out these distinctions as I understand them as this focus would be come a determining factor.

          This would make RD more of a style than a particular event. RD could sponsor a display at the Celtic Festivals and some of the expenses for participation and I think for equipment would be deductible. Matt does this already for Maryland tax exemption as Legio XX is MD tax exempt, but not Federal tax exampt.  There would have to be a board with minutes and public records kept, and the board would decide on RD directions and participation.

          I"m going to draft the mission statement and will circulate it for comment. We'll have to discuss board membership and financial responsibilities later on, but if you have experiences with this let the group know.

          Richard



        • marcus_lucretius_agricola
          Nova Roma is 501c3. Some of the documents are here http://www.novaroma.org/nr/Incorporation Agricola
          Message 4 of 4 , Nov 4, 2009
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            Nova Roma is 501c3. Some of the documents are here http://www.novaroma.org/nr/Incorporation

            Agricola
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