Subject:
Re: [discuss] EIN advantages (was" LDP can't get non-profit status ...)
From:
David Lawyer ####@####.####
Date:
19 Apr 2007 05:00:10 -0000
Message-Id: <20070419050016.GB5181@davespc>
> >>Quoting David Lawyer ####@####.####
> >>
> >>>There are still a couple of options: 1. Incorporate or 2. Get an EIN
> >>>no. to open an investment account and to perhaps: get members exempted
> >>>from liability??
> >On Tue, Apr 17, 2007 at 05:23:38PM -0700, Rick Moen wrote:
> >>To the best of my current understanding, the latter simply doesn't work.
> >>(You keep saying it's possible. If you can find some citations, I'd be
> >>glad to discuss particulars.)
> >
> David Lawyer wrote:
> >You must mean an investment account. Awhile back I Googled and found
> >2 credit unions which advertise that they are welcoming accounts from
> >unincorporated organizations. You need an EIN number however. I've
> >got the application for an account with the low-cost mutual fund Co.,
> >Vanguard. On their application for organizations there are
> >categories: corporation, partnership, sole proprietorship,
> >unincorporated enterprise, etc. I believer that we fit into the
> >"unincorporated enterprise" category and could open an account with an
> >EIN number plus they want a copy of a document evidencing that we
> >exist (the Manifesto and the web site url).
>
On Wed, Apr 18, 2007 at 09:21:30PM -0500, Bradley Hook wrote:
> If you are talking about what I think you are, then they are more
> commonly called "investment clubs." My father has participated in more
> than one, and I do not think it would be appropriate for TLDP. For a
> little more info on investment clubs, here's a website:
> http://www.sec.gov/investor/pubs/invclub.htm
No, I'm not talking about investment clubs. I'm talking about LDP
opening an account where it can earn a return on its money. It could
be a bank account, brokerage account to buy stocks and bonds, credit
union account, or a mutual fund account like Vanguard where one can
also buy stocks and bonds. It might even be an internet bank or
brokerage. Just what to invest in is another long topic which I'd
rather not discuss right now.
> >The protection of members from liability would likely be better if
> >LDP were incorporated, since if it's not incorporated, the state
> laws >like California's 18605 vary from state to state and the venue
> might >be a state without such laws. In the future, more states are
> likely >to adopt such laws so then incorporation to limit liability
> will not >be important. Since LDP is an "international virtual
> unincorporated >nonprofit association", what are the laws like in
> other countries to >provide limitations on liability?
>
> Just what kind of liabilities are you concerned about? The only
> liability that I see in TLDP's future right now would be tax fraud,
> and a corporation isn't going to protect you much from those charges
Suppose that someone gets a copy of SCO documentation, claims it's a
HOWTO and gets it on our websites. Then SCO sues LDP for billions of
dollars like they did IBM. They might try to claim that everyone on
our mailing list is a defendant. The guilty party is really the one
who got it from SCO and claimed it to be a HOWTO but SCO could claim
that LDP is to blame.
> On the EIN issue, I don't see why this is so complicated. On your
> form SS-4, check "Other nonprofit organization (specify)" as item 8a
> and fill in "Literary organization." This application would qualify
> as "Started new business (specify type)" in section 9, and then fill
> in "production and dissemination of literary works." The rest of the
> fields are fairly self-explanatory and are well documented at
> http://www.irs.gov/instructions/iss4/ch02.html
I know this. I could do it in say 1/2 hour. It's not exactly a
literary organization but more of a publishing (distribution)
organization.
> Also, note that many organizations will not readily donate to, or
> perform other charitable functions for, non-profits that are not
> specifically 501(c)(3). I have personally had to deal with this, as
> I work at an organization that is tax-exempt and eligible to receive
> tax-deductible contributions, but does not qualify under 501(c)(3).
> However, after fighting with the IRS to get a letter of
> determination, we have received grants and charitable contributions
> by carefully explaining our situation and showing-off our pretty
> letter (actually, it's a rather grainy facsimile).
I don't think we need much money if we can find volunteers. But one
advantage of incorporating is that then we could then utilize
VolunteerMatch to search for volunteers. I think that LDP should
incorporate if we can do so without much cost and keep basically the
same organizational structure. The first step is this process will be
to find a good president, treasurer, and secretary.
David Lawyer
