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Re: political action?



On Fri, May 05, 2000 at 10:58:22AM -0700, Gary Preckshot wrote:
> He wants to use the resources of LDP, which is more the issue. The
> LDP isn't about political action. If it publishes a HOWTO about
> political action, the IRS may suddenly take an interest. Up to now,
> LDP probably hasn't even considered it's tax exempt status.

Since LDP is an informal organization it is not a legal entity and has
no tax status.  Since it has no net income, there is nothing to tax.
So we are free to get involved in politics if we want to.  Even if it
was formally organized as a tax exempt charitable corporation (it
isn't) it would not be apt to lose its tax exemption by distributing
political documents written by others.  Here is the federal
requirement for such tax exempt status (where "this corporation" would
mean LDP if it were incorporated):

No substantial part of the activities of this corporation shall
consist of carrying on propaganda, or otherwise attempting to influence
legislation, and this corporation shall not participate in or intervene
in (including publishing or distributing statements) any political
campaign on behalf of (or in opposition to) any candidate for public 
office.

> But if LDP is perceived as an advocacy organization, contributions
> of money, effort, and equipment are no longer tax exempt.

Income subject to tax is net income, which is income minus
expenditures.  So while effort is something of value, it is also an
"expenditure" leaving us no monetary profit.  So even if it's not tax
exempt, there can't be any taxes on it.  LDP doesn't own any equipment
AFAIK.  We can't accept money either, although obviously authors can
accept contributions as individuals. 

> Also, if someone uses the political HOWTO to promote something our
> sponsors see as inimical to their interests, they won't be pleased.
Correct, but I doubt if this will happen.

                        David Lawyer


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