Re:Aerc and IRS

[guest@endurance.net]

PLEASE DO NOT REPLY TO GUEST@ENDURANCE.NET!!!
You must post replies to the actual sender listed below.

From: guest@endurance.net 
Email: guest@endurance.net

First of all, Teddy. You may have discussed unsigned posts, but since you don't make the rules on this listserve (thank god) and since neither rules 1 2 or 3 as posted by Steph Teeter forbid unsigned posts my interpretation is that unsigned posts are deemed suitable by the ADMINISTRATOR of this listserve.

Secondly, the author who mentions whether AERC should or should not be a charitable organization is somewhat off course with respect to the question of whether AERC should continue to be a 501(c)3 or a 501(c) od another type.

A 501(c)3 (which AERC currently is) can be either charitable or not, both are TAX DEDUCTIBLE and tax exempt.

The difference in whether one of these is considered a charitable organization is moot because AERC does not qualify and never requested such a type with respect to the IRS. Additionally, a charitable org must meet the 30% rule with regard to source of income which AERC would never accomplish.

The real issue is this: Did the IRS make a request of AERC to alter its bylaws for the purpose of altering (at the IRS's prompting) the AERC tax status from a 501(c)3 organization to another 501(c) type ?

If this is the case, the AERC should fight at all costs to remain a 501(c)3 if at all possible for future tax and possible gift reasons. HOWEVER, it may be that AERC has performed in the past outside the boundaries of 501(c)3 (knowingly or not) and is now being SUGGESTED by the IRS to alter its status voluntarily to prevent a PROBLEM.

If this is the case I would suggest AERC consider a good tax rep before they cave in to the IRS. Remember, once you lose or give up 501(c)3 you will not get it back ever.

Future gifts to AERC may NOT be tax deductible by the contributor if AERC's status were altered.

The AERC qualifies for 501(c)3 status under numerous IRS rules AS LONG AS IT IS OPERATED PROPERLY. For instance, an organization whose goal is the promotion of amatuer sporting events is a candidate for 501(c)3 status. An interesting sidenote, most major corporations will ONLY donate funds to a 501(c)3 organization. 

signed
I'm no tax attorney but...