There is a fable going around that it is easy to get (c)(3) status and that it is easy to maintain. This was true for a long time, and with the streamlined procedure it is in some sense stiill true. The trouble with all this is, when the IRS gets a new set of madates regarding enforcement then there will be audits. And in case of an audit all those (c)(3)s are likely to have a problem. The problem is, in what sense are you a charity?
This section of the IRS code was intended for businesses founded for charitable, religious, educational, scientific, or literary purposes, or for purposes of testing for public safety, fostering amateur sports competition, or preventing cruelty to children or animals. Very few coworking related businesses are doing those things as their purpose. Fostering community is not charitable in nature unless your community is a charitable community. So in case of audit the chace is large of losing that status and all the headaches that follow. I think the chance of audit is small. But why start by trying to shoehorn your space intoa category that it does not easily fit? A (c)(6) is more appropriate and more suitable for a lot of spaces. The co-op is also in the rise and I expect to see more state level legislation in future in this area. Als LLC's are often a good choice. It is the case that changing business form is not difficult, But it is distracting and expensive. I am interested in the L3C, because I think the notion of "low profit" companies is an interesting development in terms of how we think about doing business. But I am I confess a little wary about it in general, possibly it is my nature to be careful abotu Legislatures bearing gifts. B Corps are also interesting I think for coworking spaces. Also new, but a little clearer in terms of the qualifications and governance. On Wednesday, September 2, 2015 at 12:03:19 AM UTC+2, Bucketworks wrote: > > Why a C6? Not a C3? > > > -- Visit this forum on the web at http://discuss.coworking.com --- You received this message because you are subscribed to the Google Groups "Coworking" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. For more options, visit https://groups.google.com/d/optout.
