Three new FOSS umbrella organizations in Europe

Posted Feb 3, 2017 2:20 UTC (Fri) by bkuhn (subscriber, #58642)
In reply to: Three new FOSS umbrella organizations in Europe by paulj
Parent article: Three new FOSS umbrella organizations in Europe

I really wish folks could give over this myth (which now just seems to border on FUD) that donating to a 501(c)(3) in the USA “ties the money to the USA forever”. I commented on that issue on the related article you mention too. Funds are tied to a specific charitable mission, but USA charities of all sorts work around the world through grants, contractors, and even employees. Unlike in some European countries, donated funds to a USA charity aren't a tax credit for the donor, but rather just a deduction, and thus the USA doesn't have particular strict rules on this.

The charity is required to document such expenses and where they went, but that's a good thing as it provides great transparency. (See page 26 of of Conservancy's recently filed Form 900 for FY 2015 for an example.

As someone who has help run a fiscal sponsor organization for Free Software longer than anyone, I'm glad to see more entities created, as Conservancy has a line out the door and around the block of projects wanting to join us and between us and our partners over at SPI, we can't possibly host every thing project. Fiscal sponsorship is labor-intensive work so more people willing to provide such services is great for our community. It's also always good to experiment with new models. As an expert in the area, my primary area of skepticism is the one of these three new examples that the author of this article says won't handle any money at all. In my experience, getting someone do the mundane aspects of collecting funds and spending then on project needs is what most Free Software project seek most, so leaving that part out for someone else to do is optimizing away the toughest part of the process that is the most important and taking on only the easy bits and fun bits. ;)

Finally, the article doesn't seem to cover what the state-mandated reporting requirements for these orgs will be. I think it's absolutely essential to incorporate fiscal sponsors in jurisdictions that have heavy transparency requirements so everyone can see the full details of what the org is up to. This is a huge benefit to orgs based in the USA; because the Form 990 tells all.

Three new FOSS umbrella organizations in Europe

Posted Feb 3, 2017 2:31 UTC (Fri) by paulj (subscriber, #341) [Link] (1 responses)

Hi Bradley,

Thanks again for your hard work here, and for clarifying. I saw your other comment. I understand the money side is fine.

My remaining concern was more about intangible, non-money assets. Like the ownership of a domain name. Once that is transferred to a US 501(c)(3), could it ever be transferred back out of the USA? E.g., I know it would be very difficult to transfer assets out of a UK CIC abroad (though, a US 501(c)(3) would be permissible potentially). And yes, these rules exist for _very_ good reason, and they should be in place - I agree!

Also, transparency is _super_ important here, agreed. Your 990 looks quite complete. I can think of other "open source" 501(c)(3)'s that are terribly deficient by comparison. Bravo. ;)

Thanks!

Paul

Three new FOSS umbrella organizations in Europe

Posted Feb 3, 2017 2:50 UTC (Fri) by bkuhn (subscriber, #58642) [Link]

Non-monetary assets aren't that different. There are rules about giving them away to someone, just like giving money away. However, you could easily structure transfer of a domain name as a sale, and then use the proceeds from the sale toward some final charitable work in the proper area.

While the transfer of jQuery was entirely within the USA, the situation illuminates the issue. Conservancy sol the jQuery non-monetary assets to the jQuery Foundation, which was not* a charity, and then spent all proceeds on charitable work that benefit the jQuery community.