4 ms·
It's the oldest trick in the book. The nonprofit doesn't pay taxes. Nonprofit buys it's supplies from a for-profit. You mark up the supplies and buy them from
by chinchilla2020 3y ago
It's the oldest trick in the book.
The nonprofit doesn't pay taxes. Nonprofit buys it's supplies from a for-profit. You mark up the supplies and buy them from the for-profit.
Organize costs so that the for-profit incurs all the costs and the non-profit gets most of the revenue.
- bugglebeetle 3y agoThis is almost certainly a form of securities fraud, however.
- voakbasda 3y agoThat only matters if the government has the ability to prosecute it successfully, but I would posit that most fraud does not even get investigated.
- jmalicki 3y agoThis is how IKEA has been operating forever. https://www.investopedia.com/articles/investing/012216/how-ikea-makes-money.asp#:~:text=Key%20Takeaways,foundation%E2%80%94to%20minimize%20its%20taxes https://www.investopedia.com/articles/investing/012216/how-i....
- bugglebeetle 3y agoPerhaps, but let’s not assume that what a wealthy Nazi sympathizer bribed his way into doing in postwar Europe is a repeatably legal arrangement.
- ensignavenger 3y agoWhat exactly would that accomplish? The For Profit would have to pay a ton of taxes on all that revenue if the non-profit incurred all the costs!
- lupire 3y agoNet revenue minus taxes is profit.
- justinclift 3y agoCould the for-profit be located in a different jurisdiction where there's no company tax (or something along similar lines)?
- seanhunter 3y agoa)That's not the case for openAI b)If you do that, why have the not-for-profit incurring costs? Just put it all where there's no company tax.
- seanhunter 3y agoThat would strictly result in paying more tax than if you just had the for profit and put all the costs and revenues in there.