On Mon, 28 Sep 2009 16:49:29 -0700 (PDT)
Dewald Pretorius <dpr...@gmail.com> wrote:

> Then I don't understand. Why would OneForty elect to pay the
> developer's 70% in the form of a gift or donation to the developer?

All hypothetical, no malice imputed...

 - What if program costs run away and there isn't enough $$$ to cover
   the obligations? How much can developers legally recover? 30%.

 - Above a certain $$$ threshold, the accounting requirements change.
   Reporting 70% of the distribution as a gift effective triples the
   total payments that can be made to a developer before tax status
   changes.

 - Some development *is* done by non-profit organizations or could
   possibly be donated to a non-profit. If the structure of the
   developer agreement was conduscive to it, as this is, then
   non-profit work and code donations to non-profit orgs would be
   encouraged and there could be tax benefits.

Chris Babcock

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