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Q: Non-Profit providing benefits to members ( No Answer,   0 Comments )
Question  
Subject: Non-Profit providing benefits to members
Category: Business and Money
Asked by: timw1-ga
List Price: $30.00
Posted: 24 Jan 2005 10:26 PST
Expires: 23 Feb 2005 10:26 PST
Question ID: 462513
I am considering possibly starting a nonprofit organization.  The
non-profit would indeed be charitable, and its primary purpose would
be to avert poverty and provide a minimum standard of living for its
beneficiaries.  Its secondary purpose -- which would only kick in if
its primary purpose is achieved for all beneficiaries -- would be to
provide an even higher standard of living for its beneficiaries. 
However, the pool of beneficiaries would be limited to only those who
have donated a minimum amount to the nonprofit in the past...and the
secondary purpose, if it kicks in, would provide to each beneficiary
benefits which are pretty much proportional to the total contributions
made by that beneficiary in the past.  Contributions can be monetary
or be the monetary value of services provided to the nonprofit.  In
the latter case, services may take the form of an employee of the
nonprofit who opts to take a lower salary, with the difference
considered to be a contribution by him/her.  Finally, I should note
that the nonprofit would potentially own two very different types of
properties: property in which the business of the nonprofit is
conducted, and property which is owned by the nonprofit and provided
as living quarters for beneficiaries in accordance with the
nonprofit's charter.

Questions:

1.  Would a nonprofit with this organization and purpose have much
difficulty getting tax-exempt status with the IRS?  What type of
nonprofit might my nonprofit qualify as, and what tax benefits and
restrictions would apply?

2.  In general, would such a nonprofit have difficulty acheiving
tax-exempt status with the state it operates in?  In particular, what
tax benefits might be achieved in Pennsylvania, New Jersey, Texas, and
Florida?  Please consider nonprofit net income taxes, sales and use
taxes, as well as property taxes on both types of properties.

3.  Could contributions to this nonprofit be state and federally tax
deductible by individuals?  Would benefits be individually taxable by
the state and/or IRS?  What view might the states and IRS take of an
employee of the nonprofit who earns less than he might elsewhere, and
whose contribution is solely service-based?  What about non-employees
who make service-based contributions?
Answer  
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