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mich632

501(C)3 non profit status

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Ok FOG

 

It is as Eisley put so well, if you are soliciting donations for your troop and telling people or they assume are tax deductible as a contribution to the BSA that is fraud and that is illegal. The BSA is the only one who has that right and the councils are part of the BSA corporation. If any group is using the Boy Scout name in any fashion to solicit direct tax deductible contributions to units that is an infringement of BSA copyright. If National finds out their legal department will file suit against the corporation and have the charter permanently revoked.

 

People who contribute to a non profit organization usually assume that it is a tax deductible gift, and thats when there is trouble.

 

As far as corporate officers and troop committee adults being the same that is both a legal and ethical dilema for many reasons, mishandling or misappropriation of funds for starters.

 

I agree with F-Scouter 100%, this is not what scouting is all about. There are no quick fixes or legal loopholes to obtaining funds, your unit needs to go out and earn it the old fashioned way.

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This is an interesting discussion but it is raising many more questions than it is answering.

 

The reality is that Scout Troops get donations in cash and items all the time. How should these be handled? If a local artist offers to paint the Troop Logo on the trailer without charge, and the service would have cost $500, is this income to the Troop? Legally, does it have to be declared and have the Troop (a non legal entity) file an income tax return? HOW IS THIS HANDLED PROPERLY??? How is this different than a patron of the Troop donating the $500 and then paying the artist for the work done?

 

It happened to me.

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Boleta,

 

Like you said a troop is a non legal entity, small items and services like your artist example would be non taxable and non deductible contributions.

 

If you are talking about something large like a van or boat or property your local council will get involved real fast about how to handle it because of potential tax liabilities for them, even though the item is given to the troop. The council is the only legally recognized BSA entity in your area.

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So, these contributions and services are really undeclared donations to council? It seems like more trouble than it is worth to let council get involved in these kind of donations. Do we just look the other way and accept the offer? Or should we refuse it and tell the troop they will need to raise the funds in every case?

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Technically, any donations are actually made to the CO, who owns the troop. If the CO is a 501©3 entity, then the donation is tax deductable. If the organizations is not, then the donation is not.

 

I say "technically", because most common folk out there don't understand the whole CO concept. They think they are donating to a Scout Troop (which, in fact, they are). For example, the artisan, in his mind, donated his services to the troop. But, from an IRS point of view, he donated it to the First Church of whereever.

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The idea that any donation to any old group is tax deductible is a common misconception. I let people's consciences be their guide. I am not an attorney nor an expert in this area of tax law so I am not going to advise anybody one way or another.

 

It should be noted however, that as an individual volunteer you can treat your uniform expenses and unreimbursed bona fide expenses as donations. For example, if you go to Kinko's to have some stuff photocopied and you are not reimbursed, this is a donation. Create a record and save your receipt.

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"It is as Eisley put so well, if you are soliciting donations for your troop and telling people or they assume are tax deductible as a contribution to the BSA that is fraud and that is illegal."

 

What the heck does this have to do with your claim that the treasurer of the CO cannot be the treasurer of the troop?

 

boleta said, "So, these contributions and services are really undeclared donations to council"

 

Why? Just tell the donor that they aren't tax deductible if the CO isn't a 501©. I've solicited donations for many clubs and most businesses just write it off as a marketing expense. I've never collected a car or van but I once scored a $1,000 set of tires.(This message has been edited by Fat Old Guy)

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FOG,FOG, FOG

 

I am not here to argue tax law. If that company writes something off as a marketing expense they have to have a paper trail for the expense if that trail shows they donated a new car to FOG of Troop 001 the IRS will expect to see that value declared somewhere or they go out and assess it to you personally.

 

I already answered your other question about mixing officers of a corporation with the troop committee members, treasurer or other. Its called conflict of interest, especially with the handling of donations and accounts, talk to a corporation lawyer for more details.

 

You need to be careful using the BSA name for any large donation fund raising activity not sanctioned by the council. Okay FOG, like it or not those are the rules and laws we all have to live with.

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"If that company writes something off as a marketing expense . . ."

 

I guess that the multi-national companies that have given my clubs stuff don't have a clue about what they are doing.

 

"I already answered your other question about mixing officers of a corporation with the troop committee members, treasurer or other."

 

No, you didn't. You babbled about accepting contributions. The troop and the CO are one and the same. As you pointed out, the troop doesn't exist except as a part of the CO. Following your logic, it would be a conflict of interest if my wife keeps the family checkbook and the passbook for the vacation fund.

 

Considering that the IRS is famous for giving bad gouge, I'll take what you say under advisement.

 

"You need to be careful using the BSA name for any large donation fund raising activity not sanctioned by the council."

 

Why do you keep bringing this up? You don't give us a lot of faith in the government.

 

 

 

(This message has been edited by Fat Old Guy)

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Fog

 

It seems all you want to do is debate and argue.

I will not respond to you being so surly. You either just don't get it or don't want to. If you want verification for anything I told you call the IRS and ask them yourself. If you understood business law and management you would not keep asking such inane and redundant questions. As far as the council and large unit donations ask your Scout Exec.

 

Maybe after all that you will understand the proper methods of handling big donations and quit being so bitter. Peace.

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BadneP, you've been taking Bob White (may he rest in peace) lessons. You won't explain things and expect us to accept your word.

 

You keep babbling about large donations and that really has nothing to do with the direction that this discussion has gone.

 

"If you understood business law and management you would not keep asking such inane and redundant questions"

 

That's odd, I've been running my own business for quite a few years. I guess that I must understand something. I figure that if you actually knew anything that you wouldn't be working for the government.

 

BTW, shouldn't you be working (as if government employees work)? If you're on the taxpayer's dime, I'm greatly outraged that you are playing on the internet.

 

Bye now. I'll think that I'll take advantage of the ignore user feature.

 

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FOG

 

Please feel free to do whatever you like, the only one babbling here has been you. You just don't want to listen to anyone but yourself, please go ahead and use the ignore button on me then I won't have to listen to your negativity again, Amen. By the way I now run my own business and my time is my own. Your new moniker should be GOG (Grumpy Old Guy), take care.

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The discussion has been fascinating and off track. I still don't know how to handle the artist donating his skill by painting the trailer ($500 value). Does the CO have to declare this as income?

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"The discussion has been fascinating and off track. I still don't know how to handle the artist donating his skill by painting the trailer ($500 value). Does the CO have to declare this as income?"

 

I'm not sure that you have to do anything. I used to be on my church's board of directors. One of our members was a plumber who would bill the church for his work. The church would pay him and then he'd write a check back to the church for that amount. Why? He explained to me that he couldn't get any credit on his tax forms for donating labor but that he could for donating the cash.

 

I would think that the same would be true for the painter.

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FOG

That might be one of the right answers. It is interesting how it might twist if the Troop paid the artist who then donated the money to the CO (non-profit?) and the CO gave the money back to the Troop???

 

Most people probably would not have bothered and just accepted the artist's gift and left it at that. I wonder how many rules that would violate.

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