| 1 |
On Wed, Jul 03, 2019 at 10:41:36PM +0200, Michał Górny wrote: |
| 2 |
> > > The fees remain the same for a c3 (1500 per year). We've talked to the |
| 3 |
> > > Accounting firm about our options in attaining c3 status. There are a |
| 4 |
> > > couple of ways we could go about it. Filing fee remains the same (~1k |
| 5 |
> > > iirc) for all options. |
| 6 |
> > > |
| 7 |
> > > 1. fix all back taxes (10 years) then refile, this would cost 9k more |
| 8 |
> > > for the back taxes alone (4 years was recently approved). |
| 9 |
> > > |
| 10 |
> > |
| 11 |
> > Plus $15000 in CPA fees, correct? Or do we assume a different fee for |
| 12 |
> > that part? |
| 13 |
> > |
| 14 |
> |
| 15 |
> Ok, Matthew corrected me on IRC. He meant $9k of CPA fees for |
| 16 |
> the remaining 6 of 10 years. |
| 17 |
In my previous email, "Motion: approve preparation costs for tax filings |
| 18 |
FY2016-FY2019", I covered my estimate of the |
| 19 |
taxes/interest/penalties/fines that I expected for the FY2016-FY2018 |
| 20 |
periods (a total of USD9,300.00, on top of the preparation costs of |
| 21 |
USD4,500 for those 3 years; the Motion included FY2019 that I omit |
| 22 |
temporarily here). |
| 23 |
|
| 24 |
For the further 6 years back: |
| 25 |
- Preparation: 6x USD1500 = USD9,000.00 |
| 26 |
- Taxes/Interest/Penalties/Fines: USD16,000.00 |
| 27 |
Which gives a total of USD 25,000 |
| 28 |
|
| 29 |
The comparison quote from Corporate Capital, for preparation & legal |
| 30 |
costs, to create new 501cX for Gentoo, is USD 2,500. |
| 31 |
|
| 32 |
This doesn't include the filing fees, which prometheanfire estimating |
| 33 |
around USD 1,000, but would vary greatly depending on which state we |
| 34 |
filed in. I think that estimate might be as high as USD 2,000.00 |
| 35 |
depending on other states, with further traps of ongoing costs (Some |
| 36 |
states effectively have state or local taxes even on NFP incomes) |
| 37 |
|
| 38 |
The order of operations for the new org would be approximately: |
| 39 |
- prepare state-level filings to start a new NFP |
| 40 |
- file to state & wait for response |
| 41 |
- file to IRS, initial stuff |
| 42 |
- wait N years [depends on the exact NFP structure] |
| 43 |
- file to IRS, later stuff |
| 44 |
|
| 45 |
I do agree that the wind-up of the old 501c6 could happen in parallel, |
| 46 |
with the donation made to the new entity |
| 47 |
|
| 48 |
Another short-term reason AGAINST our own 501c3 are the donation |
| 49 |
structure requirements, that are meant to ensure a diversity of donors. |
| 50 |
FreeBSD ran into this in 2004: |
| 51 |
https://web.archive.org/web/20050112120244/http://www.freebsdfoundation.org/press/20041221-newsletter.shtml |
| 52 |
"The FreeBSD Foundation's 501(c)3 Status" |
| 53 |
|
| 54 |
The Gentoo Foundation DOES presently have one large cash donor, who |
| 55 |
would presently cause us to fail the 1/3rd test. |
| 56 |
|
| 57 |
The proposal of doing a large donation from the old Foundation to a new |
| 58 |
Foundation could ALSO violate the 1/3rd test, so doing the donations |
| 59 |
over time might be needed (I'd literally start taking new donations, and |
| 60 |
at the end of every month, have the old foundation make the maximum |
| 61 |
possible donation that wouldn't violate the 2% clause on the 1/3rd |
| 62 |
test). The old Foundation would also continue to pay expenses out of the |
| 63 |
accounts, to reduce the need to shift amounts over. |
| 64 |
|
| 65 |
-- |
| 66 |
Robin Hugh Johnson |
| 67 |
Gentoo Linux: Dev, Infra Lead, Foundation Treasurer |
| 68 |
E-Mail : robbat2@g.o |
| 69 |
GnuPG FP : 11ACBA4F 4778E3F6 E4EDF38E B27B944E 34884E85 |
| 70 |
GnuPG FP : 7D0B3CEB E9B85B1F 825BCECF EE05E6F6 A48F6136 |
Archives