Dave Neary wrote:

Daniel Rogers wrote:

Avoid self-dealing.

What's this?

Self-dealing is whenever the people who control the organization command the organization to do business with themselves in their personal capacity. Self-dealing "tears the veil" and makes the director or officer who engages in it personally liable for the corporation's debt by creating the presumption that the corporation is an "alter ego" of the individual. In the case of a non-profit, it also violates the rule against private inurement.

It means, inter alia, that the directors of the non-profit cannot also receive money from it except possibly a small stipend and reimbursement of their expenses in attending board meetings and other organization functions. Being a member of the board of a non-profit organization is charity work: you generally cannot expect to get paid.

If you're looking to get a job with the GIMP Foundation, you can't also be a member of its board of directors (except as an ex-officio member, which the Executive Director typically would be). This doesn't mean that the Foundation can't hire staff, just that those staff can't be the ones making the ultimate decisions on how to spend the organization's money. Staff can recommend, but final approval of at least the general budget has to be by the volunteer board. To do otherwise risks a finding that the organization inures to the benefit of a private party, which destroys non-profit status.

I'm very interested in the idea of a Foundation and would love to be a part of one, but I have no expectation of it turning into a personal revenue stream.


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