[openssl-users] good riddance to PayPal

[Steve Marquess]

On 05/11/2016 04:56 PM, Johann v. Preußen wrote:
> i am somewhat surprised your attorneys have not mentioned the most
> simplistic solution. if the sole purpose for incorporating is to
> implement banking, there is actually no need to register for an IRS
> letter. if you satisfy the state regulations and obtain an EIN you are
> fine. the IRS letter does give safe harbor to donors that the amounts
> given are federally deductible. of course, to your major donors who
> provide moneys under grants and/or contracts there is no practical
> tax-wise difference between "gift" and "business expense".
> 
> ...

State taxation isn't a problem; OpenSSL Software Foundation is
incorporated in Delaware which has no tax. U.S. tax deductibility is
largely irrelevant to our donors, most of which are outside the U.S.

> 
> all of that said, there are plenty of examples of open-source org's that
> are already IRS-recognized under IRC 501(c)(3) such as Software in the
> Public Interest, Apache, Eclipse Foundation, Open Source Initiative,
> Linux Foundation, Software Freedom Conservancy, and many more. i have
> noticed, though, what your attorneys have related to you in that the IRS
> has recently seemed to turn a blind eye to the "public benefit" clause
> when it comes to open-source software. this is a trend of just a couple

Bingo.

> of years and turns from the path they had followed for decades in
> granting acceptance. if someone took the time to copy/edit one of these
> org's by-laws and submitted to the IRS they would be hard-pressed to
> deny based on the facts and would have to reveal a decidedly
> philosophical reason which would be wide open to appeal. naturally, i
> have no idea if any of this extra effort would yield anything meaningful
> to openssl. ...

Be my guest and go for it, but I do have a good idea if it would yield
anything meaningful because I've been working this issue in detail for a
couple of years now. Our attorneys (we've checked with several, and with
ones experienced with 501(c)) don't see a viable path worth the
substantial investment it would cost us.

-Steve M.



-- 
Steve Marquess
OpenSSL Software Foundation
20-22 Wenlock Road
London N1 7GU
United Kingdom
+44 1785508015
+1 301 874 2571 direct
marquess at opensslfoundation.org
stevem at openssl.org