2009-07-11 Meeting Notes
This was a Harford Hackerspace meeting. Matt, Patrick, Kelly, Mark, and Jon attended. Nick Farr of HacDC, and accountant by day, also attended to help the Harford folks work through their IRS form 1023 (501(c)(3) application). These are my notes from Nick's comments. -Jonlesser 04:38, 15 July 2009 (UTC)
501(c)(3) application process[edit | edit source]
- When you file the 1023 form, you will be assigned a specific examiner.
- It is a good idea to communicate things to your examiner while they are working on your application. e.g., events or activities, updates on the search for space, etc.
- Filing for an exempt status other that 501(c)(3) is fine, but 501(c)(3) is appropriate for Hackerspaces in the model of HacDC, Noisebridge, etc.
- Very few 501(c)(3) apps are turned down. They will reply with questions or request clarification rather than deny you. Some examiners always ask questions, regardless of the application.
- Always file a 990 form, even if you don't have to, because your group will be added to public lists of non-profit groups and this can bring fringe benefits.
- Narrative description
- Answer the questions that they ask in the narrative
- Cover all of the time you operate. E.g., Describe what the group is doing each day of the week.
- Use the space itself as an overarching project
- When talking about fund raising , keep it simple and constrained to what you're actually doing. Don't need to speculate about what you might do in the future.
Taxes[edit | edit source]
- If you GROSS less than $20,000, you don't need to file a tax return, however, you do need to file a "postcard" just to check in.
- Writing off dues and donations is between the member/donor and their accountant.
- Do not put a value on any donated things. Let the donor establish the value and work with their own accountant to get a write off.
- If anyone received more than $700, you need to provide that person with a 1099-MISC so they can report the income on their taxes
- Reimbursements require receipts. The receipts must show the items purchased, not just the totals. You don't need to provide 1099-MISC's for straight reimbursements, even if they exceed $700.
- We can realize some profit from classes or workshops. It's good to give people something to take home, even if it's just printed instructions, so it can be said for tax reasons that they are receiving something tangible.
Bylaws[edit | edit source]
- Things to address in the bylaws: succession, money, annual report, how things get decided
- Indicate that honorarium's are possible
- Make sure voting depends on payment of dues.
- The corp should disavow any rights to intellectual property. This will encourage coworkers.
Insurance[edit | edit source]
- Get the insurance agent to physically walk through the space. Take pictures of the agent inside the space.
- Send quarterly updates to the insurance agent.
Misc Tips[edit | edit source]
- Avoid cutting checks to people whenever possible.
- Never loan anyone money
- Never let anyone live in the space for any period of time.
- Do not do child care
- Don't necessarily need an attorney or accountant for starting non profit, unless there are going to have employees. If your organization grosses less than $100,000, you shouldn't have any full time employees. If you have more than $100,000, then you should have an accountant.
- Members cannot make money selling anything to the organization. This includes commissions.
- Directors and officers should not accept honorariums for any reason