There are lots of issues that preclude a simple answer to this question, but here are my initial thoughts.
First, the absolute easiest way to do this is to become an affiliate of Carol's organization. This provides 501(c)(3) status by being under another organization's umbrella. There are some things that need to be verified, but assuming all the requirements are in place, it is most likely the way to go. Basically, there needs to be some approval by the IRS for Carol's organization to have the ability to provide group exemptions as I understand it Second, there is no rush to obtain recognition since there is no requirement for charitable organizations to file a Form 1023 to obtain tax exempt status unless their annual gross receipts exceed $5,000.00/yr. So long as GNHLUG is under $5K/yr it is under the radar. I will leave it to an accountant to say whether that in turns means no income tax return needs to be filed. My SWAG (Danger Will Robinson) is the answer is no return of any type needs to be filed, but you need to be ready to show you received less than $5K/yr and meet the definition of a 501(c)(3) public charity to prove you are exempt. My read is there is no need to file a Form 1023 under these circumstances to obtain tax exempt status which in turn means you have tax exempt status if you meet the definition and receive less than $5K/yr. Once GNHLUG exceeds $5K/yr, then it has 90 days from end of that year to apply. I rather think we have plenty of time before there is any need, legally, to seek an exemption letter. Exemption letters are what you get when you are granted status as a tax exempt organization. Once tax exempt status is granted and you meet these deadlines, the status goes back to date GNHLUG was created. As an aside, until a 501(c)(3) entity receives over $25K/yr, it has no reporting requirements at all. So even if GNHLUG obtains its own exemption letter, it will likely not have to file anything unless it becomes something it is not now. So it is entirely possible given the funding level of GNHLUG that we would be under the threshold for even having to file Form 1023 to obtain tax exempt status for the foreseeable future. Third, I remain of the opinion that 501(c)(3) is the entity of choice, the others really do not apply very well if at all. Fourth, Form 1023 is long and complicated, but no big deal. What is a big deal is it requires the applicant to have an established structure and to have developed estimated budgets projected out around 5 years as I remember. so there is some homework to do before one can even complete the form. And it does take around a year normally for the process to be completed so someone has to monitor the situation and see that it does not fall through the cracks. At this point, I don't think the homework has been done to be able to fill out a Form 1023. All of which means to me the limited time and energy should be spent now getting the organization up and running and some programs in place or whatever, and then worry about tax exempt status issues. Also, it would a very good thing to have someone whose day job is dealing with taxes to give a second look at this. I will try to look at these things in more detail, but it will take a month or so as I have a few irons in the fire. As I said, I don't think the basics of the above will changed as a result. -- Ed Lawson Ham Callsign: K1VP PGP Key ID: 1591EAD3 PGP Key Fingerprint: 79A1 CDC3 EF3D 7F93 1D28 2D42 58E4 2287 1591 EAD3 _______________________________________________ gnhlug-org mailing list gnhlug-org@mail.gnhlug.org http://mail.gnhlug.org/mailman/listinfo/gnhlug-org/
