Another Feeder Organization Denied Tax Exemption

In “All Profits to Charity?: Not a 501(c)(3),” we noted that from time to time, folks come into our office with the idea of doing something like Newman’s Own; that is, starting a business and donating all the proceeds to charity. They ask us to help them set up a 501(c)(3) organization. They are generally surprised to learn that Newman’s Own is set up as a for-profit business, and that giving all proceeds to charity Read More

Trying to Wriggle Out of Feeder Organization Status?: Not Easy

Three old hippies walk into a bar …. Well, they were former hippies, but they weren't at a regular bar. They were sipping cappuccinos at a trendy spot at Venice Beach - a coffee bar. Actually, one of them was a young lawyer, but the imaginary friends joining her were some famous former hippies. Their discussion inspired the young lawyer to set up a special new business reflecting enlightened social philosophy. But it Read More

All Profits to Charity?: Not a 501(c)(3)

From time to time, folks come into our office with the idea of doing something like Newman’s Own; that is, starting a business and donating all the proceeds to charity. They ask us to help them set up a 501(c)(3) organization. They are often surprised to learn that Paul Newman and his partner set up that salad- dressing and pasta-sauce business as a for-profit company. It gives all after-tax profits to the Newman’s Read More