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To file for a 501(c)(?), the articles of incorporation and bylaws MUST have |
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a "Purpose" that matches the valid classes of 501(c)(?): |
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=> SPI & SFC's purpose both cover Charitable, not Educational or Scientific. |
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=> LF's purpose as cited in their bylaws does match their 501(c)(6) business league. |
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|
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The Form 1023/Form 1024 have a SPECIFIC question, where you have to |
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reference the exact part of bylaws/articles that shows the purpose. |
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And the Bylaws & Articles must be included with the Form 1023/1024 |
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filing. |
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|
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On Mon, Jul 15, 2019 at 12:00:22PM -0400, Aaron Bauman wrote: |
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> > > Educational, yes. If you want examples then look at the public filings of SPI, |
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> > > SFC, etc. |
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> > > > - religious purpose: no |
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> > > > - literary purpose: no |
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> > > > - scientific purpose: no |
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> > > Scientific, yes. c.f. public filings of said companies above for an example |
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> > What filings are you referring to? Please do also note that each of |
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> > these 'purpose' types have specific definitions to the IRS. |
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> > |
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> > Neither Scientific nor Education appear in the PURPOSE of the SFC's |
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> > bylaws (which are articles of incorporation as well): |
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> > https://sfconservancy.org/docs/conservancy_by-laws.pdf |
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> It is not in the by-laws. It is in their public filings. That is, their IRS |
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> forms. |
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Can you be REALLY specific about which filing you are reading, link |
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to it instead of just saying "read their stuff", and show me where |
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you're seeing scientific or educational referenced? Charitable IS |
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referenced, but the others aren't. |
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|
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SFC's 990: |
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https://sfconservancy.org/docs/conservancy_Form-990_fy-2017.pdf |
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"Conservancy promotes, improves & defines Free and Open Source Software |
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(FOSS) projects & provides a non-profit home & infrastructure for them. |
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We directly handle many key tasks for our projects, which are mostly |
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created by volunteer developers, improving FOSS for the public good" |
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|
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Nope, no education or scientific there. |
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|
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SFC's Form 1023 filing: |
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https://sfconservancy.org/docs/conservancy_Form-1023.pdf |
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And referenced Articles of Incorporation (which again mirror bylaws): |
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https://sfconservancy.org/docs/conservancy_certificate-of-incorporation.pdf |
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|
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In my reading, the SFC qualified for 501(c)(3) under the Charitable |
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Purpose, not the Educational or Scientific Purpose. |
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|
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> > The SPI's bylaws only mention Education halfway down their PURPOSE, and |
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> > in an oblique way: |
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> > https://www.spi-inc.org/corporate/by-laws/ |
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> > "to provide information and education regarding the proper use of the |
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> > Internet;" |
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> Reference their actual filings. Not by-laws. |
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Their IRS determination letter? |
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https://www.spi-inc.org/treasurer/SPI_501c3_status_letter_IRS.pdf |
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|
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SPI's most recent 990 filing |
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https://www.spi-inc.org/treasurer/2017-990.pdf |
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"Software in the Public Interest, Inc. ("SPI") is a not-for-profit |
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organization which was founded to help organizations develop and |
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distribute open hardware and software. SPI encourages programmers to use |
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the GNU General Public License or other licenses that allow free |
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redistribution and use of software, and hardware developers to |
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distribute documentation that will allow device drivers to be written |
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for their product." |
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|
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The closest thing that covers education is their certificate of |
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incorporation, issued by the state of New York, rather than the IRS |
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https://www.spi-inc.org/corporate/certificate-of-incorporation/ |
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Don't confuse the "Education Law" part of their incorporation with |
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having "educational purpose". This also has the exact same |
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"educate"/"education" usages as the bylaws I previously referenced. |
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|
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Also of interest is to follow that X.Org was it's own 501(c)(3) that |
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dissolved and joined the SPI: |
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https://www.spi-inc.org/meetings/agendas/2015/2015-01-08/ |
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|
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X.org's purpose definition was MUCH more clearly 501(c)(3): |
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Here's their actual Form 1023 filing: |
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https://web.archive.org/web/20160108193504/http://www.x.org/foundation/irs-form-1023/4-ExhibitC.pdf |
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And the referenced articles of incorporation that DO cite the correct |
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purpose: |
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https://web.archive.org/web/20160108193510/http://www.x.org/foundation/irs-form-1023/5-ExhibitD.pdf |
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|
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The Gentoo Foundation's existing articles of incorporation don't match these. |
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|
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More of their past 501(c)(3) stuff here: |
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https://web.archive.org/web/20160102050433/https://www.x.org/foundation/ |
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|
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|
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|
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> |
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> > > > - common business interest: YES |
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> > > > |
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> > > No... see [1]. |
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> > Promoting the use of Gentoo Linux as a common business interest between |
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> > the members. |
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> > |
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> > The Linux Foundation 501(c)(6) PURPOSE on the other hand: |
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> > https://www.linuxfoundation.org/bylaws/ |
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> > "The purposes of this corporation include promoting, protecting, and |
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> > standardizing Linux and open source software." |
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> > |
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> > Gentoo's existing stated PURPOSE in the Articles of Incorporation, for |
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> > reference: |
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> > "The Corporation is organized and at all times shall be operated, on a |
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> > non-profit basis exclusive far the advancement and education and |
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> > promotion of software development in an open environment." (including |
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> > the spelling error). |
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> Yes, the LF has a more "business league" like purpose hence the 501c6 standing. |
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> If you look at their public IRS filing you will most likely see they have |
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> defined it as a business league (I have not looked at them yet). |
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|
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|
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I haven't been able to find a public copy of the Linux Foundation's Form |
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1024, determination letter, or Articles of Incorporation. The bylaws I |
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linked previously. |
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|
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Also of interest I did found the Kernel Foundation's determination |
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letter, where they wound up as a Private Foundation: |
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https://www.kernel.org/static/corporate/irs-nonprofit-ok-redacted.pdf |
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|
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> I have only started these discussions to hopefully get us to a choice soonest. |
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> As the CPA advised, it would be wise to start *now* on whichever path is chosen |
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> by the board and the electorate. |
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Help me narrow down the ranked vote then so we can run that to the |
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electorate. |
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|
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> The paperwork required to transfer assets/trademarks is not fun and will take |
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> quite some time. |
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On the plus side for the trademark paperwork, we have the complete |
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transfer records for the previous transfer from Gentoo Technologies Inc |
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to Gentoo Foundation. |
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|
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> > The quote that the CPA provided, of $1500/year, does not include |
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> > any book-keeping at all. The book-keeping they would provide would not |
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> > be in open formats keeping with our social contract. |
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> > |
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> > The CPA did review the financial statements I prepared, and beyond due |
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> > diligence requests to verify numbers (the trustee email you've seen |
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> > asking for copies of specific bank statements and reconciliation |
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> > records), they are being used to prepare filings. |
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> > |
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> > If the foundation were to retain book-keeping services, I'd want it to |
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> > be kept in open formats per the social contract, and try to find |
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> > somewhere cheaper to do it (possibly excess capacity from the SFC's new |
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> > book-keeper, who is also not a CPA). |
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> > |
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> |
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> Unless we find an umbrella who will take us then we need to let go of this whole |
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> "open source" is required to be our accountants idea. |
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Tell me, outside of the SPI & SFC, how much detailed transparency of |
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non-profit financial reports do you see? |
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|
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> c.f. the crazy skillset that SFC was looking for in order to hire an |
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> accountant [1]. It only took them 4 months to find someone. |
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> |
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> Maybe her hiring will allow them to take us on! |
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Yes, outsourcing the book-keeping to the SFC was a point I have raised |
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with the SFC before, but they wanted to finish onboarding and get some |
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initial projects done first before making the capacity available. |
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|
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> If they do the accounting and provide PDF files then I would be quite alright |
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> with that. |
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I would not be satisfied with that from a transparency perspective. |
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|
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> Please do not misconstrue my statements as anti-open-source ideals. In my |
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> opinion, this was most likely the #1 reason the RFP process failed. |
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I differ, and believe the RFP process took longer than it would |
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otherwise because the organizations/people we initially approached took |
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a look at the mess and decided NOT to bid on cleaning it up. |
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|
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Corporate Capital's rates for the tax preparation ARE higher than other |
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amounts we had seen discussed, but as they are the only ones who |
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ultimately gave us a quote, that's what we are going with. |
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https://www.jwjaccounting.com/fees for an example of a CPA that provides |
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clear estimates, showing $600-$1200/year for 990 filings (our rate from |
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Corporate Capital is $1500/year). |
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|
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-- |
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Robin Hugh Johnson |
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Gentoo Linux: Dev, Infra Lead, Foundation Treasurer |
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E-Mail : robbat2@g.o |
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GnuPG FP : 11ACBA4F 4778E3F6 E4EDF38E B27B944E 34884E85 |
185 |
GnuPG FP : 7D0B3CEB E9B85B1F 825BCECF EE05E6F6 A48F6136 |