Legal Question in Tax Law in California
Protecting tax free status of non-profit organizations
I am seeking a tax attorney with expertise in setting up the necessary types of business entities, which function to protect the tax free status of non-profit organizations. NPOs are allowed to receive a maximum amount of income before losing their tax free status. I understand that one type of protection is afforded by setting up a wholly-owned subsidiary, which will pay dividends to the NPO. The reason for seeking this info is to have my network marketing company pay a portion of profits to NPOs. Since NPOs are usually formed under IRS regulations & could be located in any state, the location of the attorney is not a consideration
2 Answers from Attorneys
NPO's under a NM
You need to call the Lawyers Referral Service in your state for lawyers who do that kind of work. At first blush, however, it appears to me that you may be trying to do something some parts of which may not be possible. That is not intended to be a definitive opinion in any way, however.
Not for profit (NPO)
I read your question, and it seems to me thatyou are trying to shelter the profits of your marketing company by running them through a tax exempt organization.
The rules concerning tax exempt organizations are very complex. However, in general, there are prohibitions designed to prevent you from doingwhat you want to do.
There are many other ways to shelter profitsfrom your marketing company that are less cumbersomethan using a tax exempt organization.
Contact me if you want to discuss your plans.
Albert V. TalamoTalamo & Volesko, PC229 Seventh St.Garden City, NY 11530(516) [email protected]
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