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Many FOSS projects/groups are non-profits. FreeBSD, Apache, etc. This being the case, it made sense to point the obvious problem with the "sell a license" iss

Many FOSS projects/groups are non-profits. FreeBSD, Apache, etc. This being the case, it made sense to point the obvious problem with the "sell a license" issue. I'm not saying a for-profit is "wrong" but you aren't taking tax deductible donations if you are running a for-profit.

Xylakant 11y ago
no-profits can engage in for-profit activities. They just need to use the profits to achieve their goal. Otherwise no non-profit could be organizing a conference since selling tickets is a for-profit activity.
- infinite8s 11y ago
  Not if they sell the tickets at-cost.
  - Xylakant 11y ago
    except for trivial cases you can't sell tickets at cost - there are way too many factors at play and you need some extra budget in case things go haywire (and they will). You want to plan your budget so that the conference is slightly profitable. BTW: Accepting sponsoring is a for profit activity as well - you get money and perform a service in return (advertise the sponsor etc.)
- fweespeech 11y ago
  > They just need to use the profits to achieve their goal. No. That is absurdly wrong. https://www.irs.gov/Charities-&-Non-Profits/Substantially-related https://www.irs.gov/Charities-&-Non-Profits/Substantially-re... > To determine if a business activity is substantially related requires examining the relationship between the activities that generate income and the accomplishment of the organization's exempt purpose. Trade or business is related to exempt purposes, in the statutory sense, only when the conduct of the business activities has causal relationship to achieving exempt purposes (other than through the production of income). The causal relationship must be substantial. The activities that generate the income must contribute importantly to accomplishing the organization's exempt purposes to be substantially related. i.e. The activity has to have a causal relationship to the exempt purpose regardless of the profit motive. Good luck convincing people software licenses qualify in the current environment without a CPA and a Tax Attorney managing things end to end. It can be done but not from the angle you claim. It has to be done for the direction of "This is our exempt purpose and by providing X we further that purpose despite the monetary gain to cover expenses."

Xylakant 11y ago

no-profits can engage in for-profit activities. They just need to use the profits to achieve their goal. Otherwise no non-profit could be organizing a conference since selling tickets is a for-profit activity.

infinite8s 11y ago
Not if they sell the tickets at-cost.
- Xylakant 11y ago
  except for trivial cases you can't sell tickets at cost - there are way too many factors at play and you need some extra budget in case things go haywire (and they will). You want to plan your budget so that the conference is slightly profitable. BTW: Accepting sponsoring is a for profit activity as well - you get money and perform a service in return (advertise the sponsor etc.)
fweespeech 11y ago
> They just need to use the profits to achieve their goal. No. That is absurdly wrong. https://www.irs.gov/Charities-&-Non-Profits/Substantially-related https://www.irs.gov/Charities-&-Non-Profits/Substantially-re... > To determine if a business activity is substantially related requires examining the relationship between the activities that generate income and the accomplishment of the organization's exempt purpose. Trade or business is related to exempt purposes, in the statutory sense, only when the conduct of the business activities has causal relationship to achieving exempt purposes (other than through the production of income). The causal relationship must be substantial. The activities that generate the income must contribute importantly to accomplishing the organization's exempt purposes to be substantially related. i.e. The activity has to have a causal relationship to the exempt purpose regardless of the profit motive. Good luck convincing people software licenses qualify in the current environment without a CPA and a Tax Attorney managing things end to end. It can be done but not from the angle you claim. It has to be done for the direction of "This is our exempt purpose and by providing X we further that purpose despite the monetary gain to cover expenses."