Gentoo Archives: gentoo-nfp

From: "Robin H. Johnson" <robbat2@g.o>
To: gentoo-nfp@l.g.o
Subject: [gentoo-nfp] Re: [gentoo-dev] Re: Gentooo 501(c) accounting
Date: Wed, 07 Dec 2016 21:32:30
Message-Id: robbat2-20161207T200233-880472961Z@orbis-terrarum.net
1 On Wed, Dec 07, 2016 at 01:46:26PM -0500, james wrote:
2 > Why thank you James for helping us focus on charity and organizational
3 > commitment. Here is an IRS online document, that is just exciting to
4 > read, when one puts on the filter of gentoo_behavior and reads the
5 > requirements to be a 501(c)3 [1]
6 >
7 > [1] > https://www.irs.gov/publications/p557/ch03.html#en_US_201602_publink1000200036
8 >
9 > So which category is Gentoo under?
10 The Gentoo Foundation is probably 501(c)(6) business league, with
11 self-declared exemption status.
12 https://www.irs.gov/charities-non-profits/other-non-profits/business-leagues
13
14 I use probably, because of the lack of documentation from prior
15 trustees, and the unwillingness of the IRS to provide any confirmations
16 to date.
17
18 There is a category for some 501(c) organizations: self-declared
19 exemption.
20
21 See
22 https://www.irs.gov/PUP/charities/charitable/How%20to%20Apply%20QAs%20Part%201.pdf
23 Page 15, question 66:
24 | 66) Please explain the concept of self-declaring.
25 | However, many other kinds of tax-exempt organizations, such as those
26 | that wish to be exempt under section 501(c)(4), 501(c)(6), 501(c)(8),
27 | and 501(c)(10), are not required to apply to the IRS to be tax-exempt.
28 | Instead, they must simply comply with the rules for organizations
29 | operating under that subsection and meet their annual filing requirement
30 | (by filing Form 990, 990-EZ, or 990-N). These organizations are known as
31 | self-declarers. They will not have a formal determination letter from
32 | the IRS recognizing them as tax-exempt, but they are not legally
33 | required to have such a letter. Some organizations that that are
34 | eligible to self-declare may still choose to apply for recognition of
35 | tax-exempt status and receive a determination letter from the IRS.
36
37 See further below, regarding what papers we do and don't have.
38
39 > Where are the public records?
40 As the present treasurer, I have the following physical items regarding
41 the foundation:
42 - trademark registrations & legal proceedings thereof.
43 - some bank statements
44 - old chequebooks (the registers not consistently filled in)
45
46 This was ALL that was provided to me by the prior treasurer, and I've
47 been hunting for any further documentation, to no avail so far.
48
49 Separately, we've been working to try and get the IRS to give us copies
50 of anything that was filed by previous trustees.
51
52 The last treasurer said that his accountant filed tax papers for the
53 Foundation, but the treasurer did not provide any documentation or
54 copies of those tax papers, nor has he informed us who said accountant
55 was. He ignores my emails & phone calls now. The items listed above were
56 only provided to us after we sent registered mail.
57
58 I constructed the entire Ledger, including historical data back to the
59 start of the Foundation, when I took on the role of bookkeeping in early
60 2015. No prior ledgers or accounting summaries were provided to me, and
61 this also gave an opportunity to review the prior financial reports from
62 other treasurers: minor errors were found, mostly around reversals &
63 correct recording dates for transactions that spanned financial years.
64 For our banking at Paypal & CapitalOne, I am certain that no financial
65 irregularities took place, but would welcome some more invoices for some
66 of the expenditures marked under GSOC reimbursements.
67 The earlier bank account at NetBank had almost no records available at
68 all, so it's possible there may have been unknown deposits &
69 withdrawals. I could only construct those transactions via finding
70 records of the other side (transfers to/from paypal, bugs, mailing list
71 posts).
72
73 - We DO have an EIN (early email from Daniel Robbins that cites it)
74 - We don't have the actual hard-copy issuance of it.
75 - I can find no evidence that an exemption request Form 1024 was filed
76 by the prior trustees.
77 https://www.irs.gov/publications/p557/ch04.html#en_US_201602_publink1000200309
78 - I can find no evidence that prior trustees filed any federal annual
79 reports, or tax forms (990 series).
80
81 Why were the 990 forms not previously filed?
82 - Because the revenue was too low?
83 - Because the treasurer didn't do it?
84 - Some other reason?
85
86 > Can we get complete historical ledger of the organization published?
87 There's one major blocker to the historical ledger, and some minor
88 ongoing pieces.
89 1.
90 I've been asking for some tooling to anonymize the personal information
91 contained in the ledger.
92 - names & paypal-linked emails of paypal contributors
93 - we did not get their permission to publish their names, so they need
94 to be made anonymous in some way.
95 - Paypal-linked emails of reimbursed parties.
96 - eg paypal accounts linked to dedicated or personal emails.
97 - the name here is NOT made private, because it's linked in bugs in
98 almost all cases.
99 - Authorization tokens in paypal messages.
100 - Consistently hash paypal transaction IDs.
101 - Needs to be consistent so you can see related transactions &
102 reversals.
103
104 2.
105 The ongoing pieces.
106 - I've been trying to track down values for all non-monetary donations,
107 so that they have suitable deprecation applied.
108 - Figuring the CORRECT handling of deprecation (esp for non-monetary).
109 - It looks like flat/linear depreciation is fine.
110 - What date to put the deprecation expenses on:
111 - end of financial year?
112 - every calendar year or month from the acquisition of the asset?
113 - Example case is our purchase of new VM hosting servers just before
114 the close of Q4 FY2016. This single purchase accounted for more than
115 75% of all expenses in FY2016. (~$10k of ~$12.8k)
116
117 > Are we (gentoo, council and foundation) in compliance?
118 - Foundation: that depends a lot on what prior treasurers did.
119 - Council: What compliance requirements do you think exist for the Council?
120
121 > Audit Records?
122 We have never been audited by any external parties. My new Ledger does
123 form a means of auditing the earlier financial reports
124
125 > Let's get cracking on which FOSS package we want to use, as a
126 > community decision. I suggest preparation and a public vote.
127 We're ALREADY using Ledger. The complete Ledgers are about ~3k records,
128 with the SFC's NPOAcct [1] tagging format data [2] on them.
129
130 The GNUCash folk note that a 1:1 transform is possible, so if those
131 scripts are available, and usable bi-directional, that would help
132 anybody wanting to contribute via GNUCash (perhaps it has better
133 anonymization functions?).
134
135 [1] https://k.sfconservancy.org/npo-ledger-cli
136 [2] https://k.sfconservancy.org/npo-ledger-cli/files/438e0688929da670bdc37c99baf213f55ef0f8b0/npo-ledger-cli-tutorial.md
137
138 --
139 Robin Hugh Johnson
140 Gentoo Linux: Dev, Infra Lead, Foundation Trustee & Treasurer
141 E-Mail : robbat2@g.o
142 GnuPG FP : 11ACBA4F 4778E3F6 E4EDF38E B27B944E 34884E85
143 GnuPG FP : 7D0B3CEB E9B85B1F 825BCECF EE05E6F6 A48F6136

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