+----------------------------------------------------------------------+ | | | The IRS has approved Cyberspace Communiction's application for | | 501(c)(3) tax-exempt status. This means donations to Grex are | | now officially recognized as being tax deductable. | | | +----------------------------------------------------------------------+127 responses total.
I'll enter the text of the letter after I have had time to scan it in. It's an extremely dull form letter, mostly just a review of the reporting requirements for 501(c)(3) corporations. They accepted our application as submitted, no questions or addenda. My understanding is that this means that Cyberspace Communications is recognized as having been a qualifying 501(c)(3) corporation since it's founding. I don't know if you can amend your past tax returns if you didn't claim a deduction for your donations to Grex.
I would not recommend doing anything of the sort, it would probally be very silly and not worth it at all.
in the announcements item, this current item was announced. aa again, please be careful with this, it is not necessarily a blessing adn has the seeds for destroyign the grex we have become. i presume the above gloomy potential will be guarded against with ALL diligence .....yet, now it exists. oh, and btw, serious congratulations to the ppl/group who pulled this one off. i mean that also.
TS, I understand what you're getting at. You've seen 501C3 really do a number on another system you cared about. I seriously don't think that's an issue here, though, because Jan et. al. were careful to describe in painful detail and utter honesty just exactly what Grex of today is and does. Obviously that was well within the realm that the IRS considers acceptable because we got an immediate OK, which I am given to understand is pretty rare. It might someday become an issue if the general membership decides it wants to make fundamental changes to Grex as we know it -- but I don't think we need to borrow trouble. And THANK YOU! Jan -- and obviously you did a tremendous job!
Yes, babies can grow up to be bank robbers, but it's actually a fairly uncommon event, so you shouldn't morn too much when a new baby is born. In the following response, is a typed-in copy of the letter the IRS sent us (my scanner felt it was too dim to scan). To people not habituated to reading IRS documents, this letter may seem vaguely alarming. Be assured in advance that there is nothing in here of the least interest. This is the IRS's idea of a friendly note to a group of solid citizens that it thinks are doing enough good for society to be exempted from taxes. The only scary thing about it is that (1) human beings wrote it, and (2) it makes perfect sense to me.
INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
DISTRICT DIRECTOR
P.O. BOX 2508
CINCINATI, OH 45201
Employer Identification Number:
Date: 38-2998091
JUL 13 1998 DLN:
17053155035048
Contact Person:
CYBERSPACE COMMUNICATIONS D. A. DOWNING
C/O JAN WOLTER Contact Telephone Number:
406 WEST LIBERTY (513) 241-5199
ANN ARBOR, MI 48103-4343 Accounting Period Ending
DECEMBER 31
Form 990 Required:
YES
Addendum Applies:
NO
Dear Applicant:
Based on information supplied, and assuming your operations will be as
stated in your application for recognition of exemption, we have determined
you are exempt from federal income tax under sections 501(a) of the Internal
Revenue Code as an organization described in section 501(c)(3).
We have further determined that you are not a private foundation within
the meaning of section 509(a) of the Code, because you are an organization
described in sections 509(a)(1) and 170(b)(1)(A)(vi).
If your sources of support, or your purposes, character, or method of
operation change, please let us know so we can consider the effect of
the change on your exempt status and foundation status. In the case of
an amendment to your organizational document or bylaws, please send
us a copy of the amended document or bylaws. Also, you should inform
us of all changes in your name or address.
As of January 1, 1984, you are liable for taxes under the Federal
Insurance Contributions Act (social security taxes) on remuneration of
$100 or more you pay to each of your employees during a calender year.
You are not liable for the tax imposed under the Federal Unemployment Act
(FUTA).
Since you are not a private foundation, you are not subject to
the excise taxes under Chapter 42 of the Code. However, if you are
involved in an excess benefit transaction, that transaction might be
subject to the excise taxes of section 4958. Additionally, you are
not automatically exempt from other federal excise taxes. If you have
any questions about excise, employment, or other federal taxes, please
contact your key district office.
Grantors and contributors may rely on this determination unless the
Internal Revenue Service publishes a notice to the contrary. However,
if you lose your section 509(a)(1) status, a grantor or contributor
may not rely on this dtermination if he or she was in part responsible
for, or was aware of, the act or failure to act, or the substantial or
material change on the part of the organization that resulted in your
loss of such status, or if he or she acquired knowledge that the Internal
Revenue Service had given notice that you would no longer be classified
as a section 509(a)(1) organization.
Donors may deduct contributions to you as provided in section 170
of the Code. Bequests, legacies, devises, transfers, or gifts to you
or for your use are deductable for federal estate and gift tax purposes
if they meet the applicable provisions of Code sections 2055, 2106 and
2522.
Contribution deductions are allowable to donors only the the extent
that their contributions are gifts, with no consideration received.
Ticket purchases and similar payments in conjunction with fundraising
events may not necessarily qualify as deductable contributions, depending
on the circumstances. See Revenue Ruling 67-246, published in Cumulative
Bulletin 1967-2, on page 104, which sets forth guidelines regarding
the deductibility, as charitable contributions, of payments made
by taxpayers for admission to or other participation in fundraising
activities for charity.
In the head of this letter we have indicated whether you must file Form
990, Return of Organization Exempt From Income Tax. If Yes is indicated,
you are required to file Form 990 only if your gross receipts each year
are normally more than $25,000. However, if you receive a Form 990
package in the mail, please file the return even if you do not exceed
the gross receipts test. If you are required to file, simply attach
the label provided, check the box in the heading to indicate that your
annual gross receipts are normally $25,000 or less, and sign the return.
If a return is required, it must be filed by the 15th day of the fifth
month after the end of your annual accounting period. A penalty of
$20 a day is charged when a return is filed late, unless there is a
reasonable cause for the delay. However, the maximum penalty charged
cannot exceed $10,000 or 5 percent of your gross receipts for the year,
whichever is less. For organizations with gross receipts exceeding
$1,000,000 in any year, the penalty is $100 per day per return, unless
there is a reasonable cause for the delay. The maximum penalty for an
organization with gross receipts exceeding $1,000,000 shall not exceed
$50,000. This penalty may also be charged if a return is not complete,
so be sure your return is complete when you file it.
You are required to make your annual return available for public
inspection for three days after the return is due. You are also required
to make available a copy of your exemption application, any supporting
documents, and this exemption letter. Failure to make these documents
available for public inspection may subject you to a penalty of $20
per day for each day there is a failure to comply (up to a maximum of
$10,000 in the case of an annual return).
You are not required to file federal income tax returns unless you are
subject to the tax on unrelated business income under sections 511 of
the Code. If you are subject to this tax, you must file an income tax
return on Form 990-T, Exempt Organization Business Income Tax Return.
In this letter we are not determining whether any of your present or
proposed activities are unrelated trade or business as defined in
section 513 of the Code.
You need an employer identification number even if you have no
employees. If an employer identification number was not entered on your
application, a number will be assigned to you and you will be advised of
it. Please use that number on all returns you file and in all
correspondence with the Internal Revenue Service.
This determination is based on evidence that your funds are dedicated
to the purposes listed in section 501(c)3 of the Code. To assure your
continued exemption, you shoud keep records to show that funds are
expended only for those purposes. If you distribute funds to other
organizations, your records should show whether they are exempt under
section 501(c)(3). In cases where the recipient organization is not
exempt under section 501(c)(3), there should be evidence that the funds
will remain dedicated to the required purposes and that they will be
used for those purposes by the recipient.
If distributions are made to individuals, case histories regarding the
recipients should be kept showing names, addresses, purposes of awards,
manner of selection, relationship (if any) to members, officers,
trustees or donors of funds to you, so that any and all distributions
made to individuals can be substantiated upon request by the Internal
Revenue Service. (Revenue Ruling 56-304, C.B. 1956-2, page 306.)
If we have indicated in the heading of this letter that an addendum
applies, the enclosed addendum is an integral part of this letter.
Because this letter could help you resolve any questions about
your exempt status and foundation status, you should keep it in your
permanent records.
If you have any questions, please contact the person whose name and
telephone number are shown in the heading of this letter.
Sincerely yours,
<Glen E. Henderson>
District Director
Letter 947 (DO/CG)
This response has been erased.
A big second from me. Jan put in a lot of work on this. Thanks, Jan!
Typing that letter in must have been bad enough--but thanks for doing that. It gives us a taste of what you've been working on.
This is not a good thing.
hrm.. time for me to move into gear.
well, this immediately throws teh auction.cf into a cocked hat ...
"only to the extent that their contributions are gifts,
with no consideration received."
who is responsible for massaging this pending imbroglio?
who does the best hoop-dance around here?
I'm quite impressed. This was approved on the first pass, no? I don't share tsty's impending sense of disaster, but we should put into place some guidelines for handling donations.
The question is, now that you have it, what are you going to do with it? I would hate to see another organization squander its 501(C)(3) status.
We got the status based on a very honest and straightforward accounting of what Grex is and does. The auction is in the application. No worries.
Quite right, no need for massaging anything. I'm curious what Dan means by "guidelines". THanks Jan, for all your work. It took someone to stand up and do the drudgery on this to make it work, and you did it.
(It also took someone to write a really good application.)
So, will some one in plain English, tell me whether or not the money from the auction is refunadble? (It makes no diference in my bids, just curious.)
Thanks for all your hard work, Jan
Didn't we have a problem with this last summer with nt? Normal donations aren't refundable. I don't think the auction's are, either.
re #15: I have no problem with what Grex does. The question is, what will
Grex do in the future? If the goal is to stay just like this, well,
let's just say that would not be a good use of the status.
I think there basically 3 differences 501c3 makes, one small, 2 big. The small one is we will need to be *slightly* more careful about chasing down all the obscure tax consequences and following them. This is mostly a reporting/recording issue, and is almost entirely stuff we are doing already, and *should* be doing anyways. The first of the major things is, individual donors who already donate stuff to grex, will get a few more tax options, if they so choose. I think this benefit will be primarily psychological, and I don't expect this to have a major financial impact to the individuals concerned, to grex, or to the federal government. It's still nice to make those individuals feel good, because they've done a huge favour for grex. The second of the major benefits is the one I think could be most useful to grex: we have now enormously improved our chances of pimping some serious hardware from a Big Company. We've already made a choice to specialize in technically obselete "formerly expensive" computer equipment, and developed in-house expertise to make this equipment useful on grex. Until now, we've only been able to use hardware that was so obselete, even the accountants in the company had given up on recovering any value from the hardware in question, so they were willing to give it up to anyone who would haul it away. Now, we can get that equipement at least a year earlier in the depreciation schedule, after it's been replaced and is functionally worthless to the company, but still has book value and isn't quite "worthless" to the accountant. We can essentially give that book value back to the company in the form of tax credits, and get ahold of newer stuff. ( Of course m-net has long had the same benefit. In fact, they've gotten some interesting hardware this way, which they basically wasted because they weren't able to use the in-house expertise they had effectively. )
resp:21 Apparently the IRS doesn't think so. Why do you think it would be "not a good use of the status", Aaron?
Geez. You may think it is wonderful that you can sit on your ass doing nothing, after somebody hands you the tools which can help you move your organization far beyond its limited role and make it a truly meaningful part of the community. Maybe that's what you had in mind from the start. However, if you do so, you will just have to live with the fact that I will look down on you for wasting opportunity.
Boy, that's a hard one. ;-)
I don't think Grexes providing the services it provides, free of charge, to all comers is "sitting on it's ass'. If you do, and you choose to think less of us for it -- so be it. Can't please everyone.
I know arbornet has a pretty broad charter, and has for a long time been interested in doing more than just running M-Net. I don't think Cyberspace Communications has any interest in doing more than just running Grex. What we are doing is just fine. If I bought a chain saw to help cut up a fallen tree in my backyard, would you come to me and say "you should cut down some more trees - otherwise you aren't making good use of your chainsaw." Tools are tools. They exist to serve YOUR needs. YOU do not exist to give your tools proper exercise. Yes, there are organizations that use their 501(c)(3) status to save the world in more spectacular ways than Cyberspace Communications does. But there are also plenty, that do less. So what? There may well be times in the future when we want to make adjustments to Grex's mission and direction. But those adjustments should be responses to the needs of our users. Grex's course should NEVER be determined by its 501(c)(3) status. If we make changes to better meet the needs of our users, then we should report those changes to the IRS, as the letter above asks us to. If they revoke our 501(c)(3) status, that's fine - we've lived without before and we can live without it again. But as long as what we want to do happens to be tax-exempt, then we should certainly have formal recognition that status. We should never be thinking about what Cyberspace Communications has to do to keep or to deserve its tax-exempt status. We should be thinking about what we want this organization wants to do in service of its users and the broader community. We NEVER should have to worry if doing something would require changes in our status. If we WANT to do it, then we do it and send a letter to the IRS. They'll tell us if our status has changed. IRS regulations do not and should not set our agenda. My personal expectation is that we are unlikely to want to do anything that would require any changes to our status. Most of the kinds of things that would be a problem are pretty unattractive in their own right - seriously reducing free services, endorsing political candidates, stuff like that. Still, if we want to do that, we can. The IRS letter just recognizes that what we are doing now is tax-exempt. It doesn't demand that we keep to that forever.
I warned that the text of the letter I entered is not safe for people who are easily alarmed or unused to talking to bureaucrats. I think TS didn't survive the letter: >well, this immediately throws teh auction.cf into a cocked hat ... > "only to the extent that their contributions are gifts, > with no consideration received." > >who is responsible for massaging this pending imbroglio? That clause does not say that we can't have auctions. Here's a quote from IRS publication 557: FUND-RAISING EVENTS: If the donor receives somthing of value in return for the contribution, a common occurence with fund-raising events, part or all of the contribution may not be deductible. This may apply to fund- raising activities such as charity balls, bazaars, banquets, auctions, concerts, athletic events, and solicitations for membership or contributions when merchandise or benefits are given in return for payment of a specified minimum contribution. Note that the IRS is OK with all these things. It recognizes that they are common among tax-exempt organizations and doesn't object to us doing them. We do several of these things - membership dues and selling donated objects. They are legal. The question is how much of the person giving us money can deduct from their taxes. Before we had tax-exempt status, the answer was easy: not a cent. (Except that technically we always had tax-exempt status, only the IRS hadn't officially noticed yet - some braver users have been deducting their donations for years.) With tax-exempt status the answer can be a bit more complex, since it involves the value of the goods received. Most of our donors won't be bothering with this, since their donations are small or they don't itemize deductions - they won't be deducting anything, which is certainly fine with the IRS. Note also that the issue of what you deduct from your taxes isn't, for the most part, Cyberspace Communications' problem. That's between you and the IRS. You're welcome to deduct anything you think you can get away with. We need to figure out what kinds of receipts we should give people. That's all. The next paragraph from publication 557 talks about this a bit, but we need to get publication 1391 to get full answers on this: If a donor received some benefit in return for a contribution to your organization, the donor can only deduct the portion of the contribution, if any, that is more than the fair value of any benefit or merchandise to be given to contributors. You should determin in advance the fair value of any benefit or merchandise to be given to contributors and tell them when you publicize the fund-raising event or solicit their contributions how much is deductable and how much is for benefit or merchandise. This topic is discussed in more detail in Publication 1391, "Deductability of Payments Made to Charities Conducting Fund-Raising Events." You can ask IRS to send you a copy. [Mark has already asked.] So yeah, we need to figure out the "fair value" of Grex memberships (off the top of my head, I'd guess $2 a month - maybe less, but I want to read 1361 before deciding this) and how to handle the auctions (I think we don't set a value on market goods - donors deduct their estimate of fair value, buyers deduct their estimate of fair value, but again, 1391 should clarify this). Lots of tax-exempt organizations do things like the auction. I don't actually know exactly how to handle it, but rules exist and they can't be all that hard to follow or there'd be lots fewer of these things going on. It's not an "imbroglio" that requires "massaging". We just need to figure out the tax law so we can give our users a little guidiance and support in filling out their tax forms sometime before next April. Any user who finds all this too high for them is welcome to just continue doing as they have done in the past - donate money and don't deduct it from your taxes. That way the tax-exempt status will have no impact on you at all.
One other note: Thanks for getting the 501(c)(3) application done also go to Mark Conger. He pulled together three-and-a-half years of financial records and generated all the financial data that the IRS wanted, redoing it several times to get it all right. We couldn't have done it without him.
Good show, Jan. Dues to a 501(c)3 are deductible, except for that "something of value" thing. I don't think Grex gives anything that fits into this category. I have already cited the case of a New York non-profit that restricts parking at its Manhattan headquarters to members. The value of that does not have to be declared. That "something of value" is something that is either provided "rarely" (like, say, an annual dinner), or also sold (like a slick magazine). So, don't even consider trying to put a "value" on grex membership. The dues are a simple donation.
i survived the letter just fine, janc - and you answered teh specific question, why add mud?
re #27: I don't care what you do with your chainsaw, until you ask me to
subsidize your activities. You want to stick your hand in my wallet?
Sorry -- I'm going to tell you what I think.
Don't pretend that you went out and bought a chaninsaw, and that I
have no right to tell you how to use it. You went out and got a
tax exemption -- a goverment subsidy of your activities.
This item is now linked to co-op.
resp:32 Aaron, do you feel the need to approve of *every* program the government sees fit to support? If so, surely there are far bigger fish to fry than one little system that provides free internet access to the poor and the world.
Hey, being a frothing-at-the-mouth Libertarian, I think *all* businesses should be tax-exempt. >8) Many thanks to all who finally got this done.
Re #32: Aaron, you certainly have a right to say what you think and to try to influence Grex policy. But I happen to think what we're doing with Grex now is a fine use of our status, and the IRS agrees. In fact Jan was *extremely* careful not to embellish on what we do in the application, and the IRS approved it quite quickly. I take that to mean we are well within the boundaries of what they see as worthy of exemption.
The government (i.e., us) support non-profits with tax exemption if they provide some service that *otherwise* the government might be asked to or have to provide. Non-profits are the way our government reduces its own size. I thought Aaron normally approved of smaller government.
re #34: Read what I said, Misti. You took a subsidy, and now you get to live
with my opinion. You have two choices -- learn to live with it, or
give up the subsidy.
re #36: I don't much care what was in the application. If somebody hands you
the brass ring, and your response is, "Yawn".... don't expect me
to be impressed.
re #37: Are you asserting that Grex was granted its exemption on the basis
that it alleviates the burden on government -- one of several
categories of 501(C)(3) organizations? Possible, but very unlikely.
Incidentally, unless you were granted an express effective date retroactive to the date of the letter, it would normally follow that only those donations made after July 13, 1998 would be deductable.
Actually I also have the option of ignoring your opinion. ;) It is my opinion, and apaprently the IRS agrees, that Grex is doing a good job of providing a service that benefits this country in its own small way by providing access to the information "superhighway", albeit in a slow, clunky bus, that would otherwise be unavailable to a lot of the poorer users we serve. The better informed our populace is, the better off our country is. Granted, Grex isn't quite on par with a US Government class, or a programming class, or a journalism class -- but all these subjects and more are discussed here -- often in a manner far more amusing than the average class would be. If we can capture the imagination of the occasional young person and tun them to an interest they would not otherwise have discovered, if we can provide that one piece of information that a citizen needs to determine who to vote for, if we can provide a place where someone can develop a skill that makes them more employable, if we can help a young person to develop a little more social grace than )s)he otherwise would have, we're providing a service that makes our world a little better. OK, we're not talking about Nobel peace prize quality stuff here -- but every journey requires that first step. Maybe some day a Grexer will earn a NPP based in part on an interest developed here. Maybe not. Maybe a kid from a poor family will wander on to Grex from the local library, create an account, get fascinated by computers and go on to develop web pages for a living instead of dropping out of school and stealing cars or selling drugs. Maybe not. Maybe two people from opposite parts of the world will meet here on Grex, fall in love, marry, and give birth to the next Albert Einstein or Mohatma Ghandi. Maybe not. The fact is, we are providing a service free of charge to all comers. Like most things, the value of this service depends a lot on what you put into it. But we are making the opportunities available which is no less than the public schools are doing. We don't pour information into the heads of our users -- but truth be told, the school systems can't do that without a lot of cooperation from their users either.
Jan and Mark: I am blown away by this. It makes one hell of a neat birthday present!
re #40: Ignoring my opinion is one way of living with it, albeit not the
most constructive way.
If you can now explain how party is an educational resource, I
will have to conclude that you are eminently qualified for the
M-Net board.
It isn't, and I don't think anyone would try to make the assertion that it is. However, jsut as school's have things like play areas, so can Grex.
Re 42 - OK, I'll bite. What would you consider more constructive than ignoring you?
I trie warn you,
So, so far our bit 501(c)3 drawback is that Aaron disapproves. As long as M-Net comes back up soon, that shouldn't be a big problem. ;)
if it doesn't, i propose we take up a collection to pay marcus to do grex the service of resurrecting mnet. or steve. whoever is the most willing and able to handle the security stuff necessary for the job.
Re #38 re #37: yes, the government granted Grex tax-exempt status because Grex lessens the burden on government. That is only reason that it is done. Of course, not everyone needs or wants the particular easing of burden involved, but *some* do, so the net effect of creating many 501(c)3 tax exempt organizations is a wide sprectrum of services provided by the private (non-profit) sector, based on local needs, that alleviate a burden on government.
Aaron: If the IRS recognized our status in a non-retroactive way it would *never* be as of the date of their letter of recognition. It would be as of the date when the application was postmarked, or, if there wasn't a recognizable postmark, as of the date that it was received by the IRS office. As it happens, there is a whole page of the application form that is all about determining when the status starts. You check the one that you think applies to you. The last one on the list is for non-retroactive status, as described in the previous paragraph. We didn't check that one. What I checked was the second-to-last one, the "good faith" exception to the normal filing time limits, which I felt we qualified for. This does give retroactive status. Apparantly the IRS thought so to, since they accepted the application as filed, without amendments.
I meant to remark that you did an exceptionally good job in filling out the application, since it is "usual" for the application to be returned for more information (the IRS has *forms* asking for that more information, indicating how commonly it occurs).
I have no ambitions for Cyberspace Communications to do anything better that what it is already doing - which I consider pretty darn good. If I thought that tax-exempt status would force us to do anything different than we are doing now, then I wouldn't have applied for it. If you look at our application (I forget the URL, but if you follow the "governance" link on our home page, you'll find it), you'll see that it includes mention of party, and explicitly says that a lot of the usage of the system is social rather than educational in nature. I think there is no question that such activity is fine with the IRS. If it wasn't we'd ditch the tax-exempt status, not party. It may well be that there are better things that Grex could and should be doing. I'd like to hear what kinds of things you have in mind. Not having heard your ideas, I certainly don't disagree with them. All I disagree with is that we must do these unspecified things *because* of the tax-exempt status. The only things we have to do *because* of the tax-exempt status are to issue proper receipts and returns, and continue doing what we said we were doing in our application (or inform the IRS if we change). Lots of Arbornet people have been telling us that we should get tax-exempt status. Anywhere else in the world, this advice would be considered insane. We are engaged in the kind of service that our government, in its infinite wisdom, has chosen to consider tax-exempt. Why shouldn't we ask them to recognize that status? Only because of Arbornet. For reasons unique to Arbornet (including some good reasons), tax-exempt status has become a club that people use to hit each other over the head with for years now. The concern has always be that, if Grex gets tax-exempt status, then people who have a stake in that fight on Arbornet would feel they have to carry it over to Grex, so people can't say, "well, Grex has 501(c)3 and they don't worry about any of this." The last thing that we want is to be drawn into the biggest mud fight in M-Net history. Aaron, when you declare that we have to make (unspecified) changes because we have tax-exempt status, you are setting off lots of alarms in lots of people's heads. I have to response that I reject *any* suggestion that our policies should be dictated by our 501(c)(3) status. That status is something that the government gives us in recognition of what we are doing. We'll happily take it, and use it to encourage donations to the system, but we will not be steered by it. We will be steered by the mission set forth in our articles of incorporation, and by the will of our users. We are committed to an ideal, not to tax-exempt status. I have no idea if Arbornet's tax-exempt status is in order or not. I don't think Grex's tax-exempt status is relevant to that issue. Grex is a different organization, with different articles of incorporation, different bylaws, and different ways of raising money. It's application for tax-exempt status was done on a different basis. Anyway, if you'd like to see changes in Grex's mission, I'd be interested in hearing what you have in mind, and why you think they would be more suitably performed by us than by some new organization specifically chartered to do that (e.g., it might be something that has good synergy with what we already do). I just cannot agree that we should change what we are doing simply *because* the IRS decided that what we are doing is tax-exempt. That's just weird.
I agree completely with Jan. I've said before that 501(c)3 status is both beneficial and benign, though one has one more piece of paper to fill out each year. I find all the gnashing of teeth about it incomprehensible and can only conclude that those that find themselves doing that don't understand what it is or what it requires. In particular, I am just puzzled over the turmoil at Arbornet. There are tens of thousands of non-profits that benefit from tax exemption and get along just fine with it, and then there is one that creates sound anf fury about it: incomprehensible.
Re #40 (Misti). Among other things, grex is doing a fine job of putting people in touch with each other. It also put Tim Ryan in touch with us at Kiwanis, resulting in several donated 386s which will be sold and the money used to support local non-profit groups performing services that the government would probably have done more expensively and inefficiently (since it would not have had volunteer labor). It put me in touch with a Bosnian refugee in need of a translation (thanks Larry). It got Kent Nassen in helping with computers at Kiwanis, and Richard Pirie with software. It got us a bit of recycled lumber that might have gone to the dump otherwise. We traded or acquired otehr computer equipment (omni, and a classifieds ad). It found a grand piano in need of tuning for a friend in need of practice. The computer aspect of grex is only one aspect, for many of us the chance to communicate and meet other people is primary.
You don't understand. aaron is just getting started.
Thank you, Jan for making the points I kept skipping around. ;) You're absolutely right, Sindi. I think we'd have to do extensive interviewing of many, many Grexers to make a comprehensive list of all the good a system like this does every day. ;)
Want to start an item asking 'What has grex done for you?"
That's an interesting idea... ;)
Re 54: You don't understand. I like Aaron and respect his opinions and expertize. Though I always read his posting with interest, and never dismiss anything he says out of hand, I do disagree with him on this particular issue. Aaron is not a problem. If Aaron is the only problem with 501(c)(3), then there is no problem.
This response has been erased.
See! Isn't this discussion *fun*?! 8-)
This is good news. Wonder if its retroactive. Im thinking of whoever it was that bought that 10-year membership. Guess they have bought that a month too soon, and now they can't deduct it whereas if they'd waited, they could have. Might be reasonable to offer lifetime memberships now, say for the same price as a ten-year, or $600?
Grex would have to decide whether the return on investing that $600, at most $30/year, is an acceptable discount from the regular dues of $60/year.
I'd have to say that Grex is actually putting money into Aaron's pocket. We are providing all these services that he would otherwise be taxed for. The Govt certainly can't provide them without taxes. Maybe since we are giving (a small) amount of money to Aaron every year he should instead allow us to dictate to him what are acceptable lifestyles. Now if the Govt. were writing us a check for $12,000 it would be harder to make this argument, but since we have converted from paying no taxes on our pitiful income to paying no taxes, and converted from filtering money through an inefficient Govt. to sending it directly to us where we are frankly astoundingly efficient with it I don't see how we could make any other argument than above.
By teh way, what report do we have from the city on your taxes?
Re resp:61: (1) I've seen no reason to believe that this status isn't retroactive. (2) Non-retroactive status would be granted as of the date the IRS received our application. I do have record of that date someplace, but the fact that they didn't mention it in their determination letter is another reason to believe it is retroactive. Thus, in either case, the person who made the $600 donation is in the right time period to make it tax-deductable. The question remaining is whether Grex memberships are fully tax deductable. My opinion that they are, but we still need to research this further.
re #44: Trying to understand my perspective, Rob? Did that not occur to
you, or do you consider closing one's mind to be the best
approach to disagreement?
re #46: You need to read what I said, Steve. I have no problem with
Grex's exemption -- I think it is great that it was awarded. I
take issue only with the waste of such a valuable tool --
something which may or may not happen, but which some people
show an obvious inclination, if not outright preference, to do.
Right now, we are dealing with a hypothetical future. You should
probably be more concerned by anticipatory defenses of future
inaction than with comments that future inaction would be
unfortunate.
re #48: I very much doubt that you are correct, Rane. However, if you
can provide the correspondence that backs up your assertion, I
will happily reconsider.
re #49: Jan, you are confusing two separate issues -- the date upon
which you are "retroactively" made exempt is not necessarily
the same as the effective date of your exemption for the purpose
of deducting donations. If you cannot find clear language in
the correspondence you have, inquire with the IRS. They will be
happy to clarify.
re #51: Again, it would be extraordinarily helpful if people would read
what I said. I did not say that Grex had to do anything -- I said
that it would be a shame if Grex did nothing. It would be.
Why are you asking me to point to the directions in which Grex
should grow? Last I checked, I couldn't even read your staff
conference, a source of information that would be quite helpful
to evaluating potential areas of growth.
I don't think confusion by Arbornet's directors, despite repeated
efforts to help them understand Arbornet's exemption, has any
relevance to Grex. I do think the Grex administration will read
the materials necessary to understanding the exemption, and will
understand those materials.
re #54: What is your problem, Bruce?
re #63: Oh, I get it -- Grex is going to pay for my UM Account, and my
Tabnet account, so I don't have to support the former with my
taxes, or support both with fees?
re #65: It should be as simple as a phone call -- and the number should
appear right on the corresponsence you have exchanged. My concern
here involves only whether a misunderstanding might lead people
to do something that they technically cannot do. I guess I do have
an interest in your being correct, not that I am likely to try
to amend, but as they say, better safe than sorry.
I *do* understand your perspective, aaron, I just don't happen to agree with it. Or didn't *you* bother to consider that possibility?
Aaron, there is nothing in the staff conference that would help you to make recommendations on what Grex should do in the future.
There are several ways to read the tax code: (1) what the framers of the tax code had in mind when they wrote the law (2) how the IRS (or other tax collection agency) interprets it (3) how the court interprets it (4) how an accountant might interpret it for a client (5) what "joe smith" in the streets thinks it *ought* to mean In most of these possible interpretations, it is senseless to try to apply any sort of overall logic to it. That is because for each of these views, there is not one coherent voice. Many people framed the tax laws, and they had many different and often conflicting views. 501c3 status is not an exception to this. To say 501c3 status "means" we're providing service the gov't would otherwise have to provide, or that 501c3 status is "for" charities, is complete nonsense -- that's trying to say 501c3 "means" and only one thing, and it's really just a special case of (5) [man in the street]. Unfortunately case (5) means very little where it counts--case (2) [irs] and case (3) [courts] are what matters to grex, and the viewpoint we here on grex should really be following is case (4) [accountant]. That is to say, one of grex's jobs is to figure out how to efficiently provide as much service as possible, and 501c3 is merely a tool the gov't provides us that should make us just a little more efficient. That's all 501c3 is, a tool, - it doesn't *mean* anything, any more than your social card *means* anything, or your *1993 tax income return *means* anything. It's just random data in an extremely complex game where people shuffle little bits of paper on desks, and it means we can shuffle paper just a *bit* differently, and maybe, get a slightly better deal on computer hardware.
I'd think it was a shame if Grex did try to do "something with 501c3" and in the process pissed off a lot of supporters/staff because it didn't work out. The first sentence of the letter telling us we got the 501c3 says basically says that we have tax-exempt status for things *as they are*, and that we if change that we have to tell the IRS about it so they can decide if we still qualify.
re #67: Maybe instead of being obstreperous, you will articulate your
position?
re #68: I guess I would have to take your word for that.
re #69: Now that we recognize that 501(C)(3) is a tool, perhaps we can
decide if it is best to get the most positive use of the tool, to
use it on rare occasions while leaving it in the garage most of
the time, or to leave it out on the lawn to rust.
re #70: Does the concept of "natural growth" seem alien to you? Nothing
has to be forced. Surely there are members of the Grex board who
have ideas of good things Grex could do, which will have a much
greater chance of success with its exempt status.
Am I wrong about that? Has there been a complete dearth of such
ideas among board members?
Grex has a long history of growing its services as resources permit. I see no reason why that will change. The 501(c)3 status will increase resources due to tax exemptions and increased attractiveness to donors. I'm sure that the board, staff, and users will think of nice things to do with those resources, just as they always have. So no, you're not wrong. If that's all that's at issue, I'm a bit puzzled why this discussion is so heated, or even why it's taking place.
It's not heated on my end. If it's heated on somebody else's end, they should consider that their hostility, not my comments, is at the root of that heat.
Grex is naturally growing all the time. Check out the length of the password file some time, and compare the average number of online users vs. a year ago, or two years ago.
I don't know that the password file is the best place to look for evidence of growth, nor that even if it were the place to look for growth in size, that it would be the best place to look for the type of growth of which I am speaking. Is the growth due to international users who like free email and party, for example?
This would be a much more productive conversation if *someone* would speak in specifics about what they think Grex ought to do with its 501C3 status, so I'll start: Now, with with extra resources 501C3 will provide through taxavings and any donations it inspires, I think Grex ought to focus on making as much access to computer and information resources accessible to as many people as we can support worldwide. That would include finding ways to bring more locals on board over the dialins and make more telnet ports available for the rest as quickly as that's feasible. The people we bring in will provide the information resources to one another. We might also add asection to the Handbook about how to use lynx. (Working on that one myself.) Next...
Here's the thing, though, Misti -- Abornet has proved quite decisively that just having 501(C)(3) status will *not* inspire people to donate. Recall\ that most people do not itemize, and most do not give enough to take any real advantage of the charitable contribution deduction. Don't count your chickens before they hatch -- and try to think of ways to incubate the eggs.
It is the organizations purposes and activities that inspire people to donate - 501(c)3 is just a little icing on the cake. I don't know what Grex might seek a grant for, but an organization has essentially zero chance of obtaining a grant unless they are 501(c)3 tax exempt. Something to consider if there is some new venture that Grex would like to expand into (such as, educational programs).
A measurement of growth for me would be the number of "voices"
in this agora.cf vs. a year ago or two years ago. A voice would be
a userid entering or responding to item(s). Exclude very low volume
users--those that enter item in error, or respond only to the welcome
item to not be heard again.
Has anyone made this measurement? Perhaps this methodology and
discusion seserves a new item?
Re #76: Along the lines of expansion, as mdw noted earler, the tax exemt status may give large companies incentive to donate new hardware (read- FASTER hardware), which would be a definate advantage to the 501(c)(3) status. Private donations would also be encouraged, at least for people who itemize their taxes, as they could claim Grex as a deduction now.
I don't think new donations are something to count on, which is why I emphasized the tax savings. It probably will result in the occasional corporate donation of hardware, etc. and I think that alone is sufficient. Of course, we do have to work on finding ways of getting new memebers and maintaining more existing members -- but I consider that to be a different issue, since - as Aaron has pointed out - most people won't be influenced all that much. As Rane says, our best best in getting new members is to look for people who are willing to donate because of what Grex is and what it does. Those people are out there, I'm sure. We have to find them and make it as attractive as possible for them to join in supporting the system. After listening to Dan R. at the last board meeting, I think it may be time to take a look at credit card options again. It may still be too expensive, but it could add enough convemience for our members that I think it's worth checking every so often anyway. I'm wary about looking for grants. I'd be concerend about rwo things: 1) any restrictions the grant-givers might want to place on Grex and 2) letting folks get the perception that Grex doesn't need grass-roots support because it's government/grant funded. Most of what makes Grex special is its grassroots nature. That doesn't rule out specific grant moneys for specific expansions -- but I think it would fundamentally change the nature of our system to depend on grants for support of our daily needs.
Unfounded worries. One gets a grant to *do* something over a period of time, and when it is over, it is done. I don't think that there would be a fall-off of grass roots support if Grex got a grant that started something new that they could also take advantage of. In fact, it could attract even more members to donate to continue the activity.
There is no danger of us *not* using the 501c3 status. We'll soon be making use of one minor, but pleasant surprise -- it seems 501c3 status means we don't need to pay state and local taxes on our phone lines anymore.
Getting rid of phone taxes is a very good thing :) It might also be worthwhile to have Grex moved to it's own electric meter (Check with your landlord and the electric company about this, it would let you write off the taxes on electricity, but might wind up costing too much to be worth anything). Also, looking for other possible benefits, does Grex pay any taxes on the lease? It might be possible to eliminate those also. Certainly worth an attempt.
Re #82,83: I share Misti's 2 worries about grants, but having no experience with them, I will take Rane's word for it that it is possible to avoid them. I think we should keep the pifalls in mind, though, if we decide to apply for a grant. (In other words, I believe Rane when he says that it's possible to get a grant and not be subject to strings or promote disinterest among users, but I'm not convinced that things can't go awry. So I think we should be careful.)
(#84 slipped in) No, we don't pay taxes on our lease. I will call Detroit Edison some time to see what it would take to get us our own meter, but I suspect it's going to turn out to be more than we can recoup in a reasonable amount of time.
The main difficulty that can come up with a grant is that somehow you were given one, but are not set up administratively to accomplish the task for which it was given. One keeps reading about situations like this in Detroit. What should be done is to return the grant, but this is tough if you've already set up the system to use it, even imperfectly. My main point is that the word "grant" does not necessarily mean "doom". Quite the opposite, in fact, in most cases. Granting agencies are probably even more careful than most applicants in ascertaining that the applicant really is qualified to exercise the grant.
Re resp:66, Re resp:49:
I don't think there are two different dates. Here's a quote from
IRS Publication 557:
EFFECTIVE DATE OF EXEMPTION
A ruling or determination letter recognizing exemption is
EFFECTIVE AS OF THE DATE OF FORMATION OF AN ORGANIZATION
if, during the period before the date of the ruling or
determination letter, its purposes and activities were
those required by law [deleted reference to section of manual
which tells what the law requires]. Upon obtaining recognition
of exemption, the organization may file a claim for a refund
of income taxes paid for the period for which its exempt status
is recognized.
If an organization is required to alter its activities or
substantially amend its charter to qualify, the ruling or
determination letter recognizing exemption will be EFFECTIVE
AS OF THE DATE SPECIFIED IN THE LETTER. If a nonsubstantial
amendment is made, such as correction of a clerical error in
the enabling instrument or the addition of a dissolution clause,
exemption will ordinarily be recognized as of the date of formation
if the activities of the organization before the ruling or
determination are consistent with the exemption requirements.
A ruling or determination letter recognizing exemption MAY NOT
BE RELIED UPON IF there is a material change, inconsistant with
exemption, in the character, the purpose, or the method of
operation of the organization.
This is pretty clear that the default and normal situation is that
recognition is retroactive to the founding of the corporation. It is
also clear that if there was some other date, it would be mentioned in
the letter. It explicitly says that our right not to pay federal taxes
goes back retroactively and that we could ask for anything we paid to be
returned. It does not explicitly mention the deductability of
donations, but I've never seen anything to suggest that not paying taxes
and deductability of donations are seperable.
Once again, non-retroactive status is not the default. If you are
applying for that, you have to specificly request it by checking the
"yes" box on line 6 of part III of the application form. We did not
check that box.
(It's the default if you have to make changes in order to gain 501(c)3 status, if I understand that. And that might be the normal case.)
So at least, all of 1998 can be called a tax-exempt year?
Yes. For most people that's going to be the relevant fact. But I'm convinced that every year since Grex's founding has been a tax-exempt year.
So, everyone, file amended tax returns for all those years.....
re #88: You are again dealing with a separate issue -- the corporation's
tax liability. Call the IRS -- they'll clear up the issue.
In everything I've read (which is a lot), I have never seen any hint that these two issues are separate under any circumstances at all. If there were any situation in which an organization didn't have to pay taxes, but people donating money to it did, then I think that would be a significant enough thing so that the IRS would have made some mention of it in one of their publications. My understanding is that the "two issues" are one and the same. You're going to have to present at least a thread of evidence to support your contention before I start believing that this is an issue that needs clearing up. It seems perfectly clear to me.
Jan, it is *typical* for the IRS to set an effective date for the deductibility of charitable contributions. I have never heard of any organization where years and years of past contributions were allowed to be retroactively deducted, whatever the status of the organization's tax liabilities. Perhaps you can name one? The problem here, Jan, appears to be that you are afraid that I am correct.
I think you can only redo your taxes for the past three years anyway. Aaron, I would appreciate if you could phrase your questions and comments less aggressively. Maybe you could use phrases like "I think" or "in my opinion" instead of "The problem appears to be". That is your opinion. Your style of expressions is probably normal for court appearances, but people in grex are attempting to work together, not against each other.
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Perhaps the problem was the obnoxious way Jan phrased his last paragraph. I am not responsible for the fact that there are people on this system who view any challenge to the status quo, no matter how reasoned, as hostility. If you think Jan's last paragraph was an effort at consensus building, I suggest you examine your own prejudices before challenging my presentation.
If I were in Jan's place, I would have stopped responding to your 'challenges'
long ago. You are pushing people's patience to the limit. I think it has
a lot to do with your writing style and choice of vocabulary, which are often
intended to provoke. I am attempting to analyze the problem from the
viewpoint of a linguist, not a psychologist. How about "I found the phrasing
of Jan's last paragraph upsetting"? That way Jan would not feel that you were
attacking him personally, and might continue to attempt to respond to the
facts of your argument rather than the emotions.
Anyone else want to have a go at this?
I am pushing people's patience to the limit? How? By suggesting that they check to see that the gun is not loaded before playing Russian Roulette with the IRS? I don't see that I was asking a whole lot, in suggesting that somebody make a simple phone call to clarify the issue. I don't get upset by Jan's comments -- Jan, most of the time, is one of my favorite on-line personalties, whether or not I agree with him. If you are getting upset about this discussion, the problem is not with Jan's comments or with mine. The problem is that you lack perspective.
I wish I knew who to call to get definitive answers to our tax questions. I am afraid that what Rane said may be right: if we call the IRS we may get a telephone operator who doesn't have the knowledge or authority to give out authoritative answers. My current plan is to ask the Accounting Aid Society our questions, as soon as they have received our membership dues. (Which should be any day now.) Could you recap for me, Aaron, what you think we should call the IRS about? I'm afraid I have lost the thread of the conversation.
I don't think there is anything "offensive" about the last sentence of my resp:94. You have a theory. I have a different theory. You claim that the burden of resolving the difference falls on me. That I should go out and do a lot of research. Why should I do that? I'm a busy person. I have to decide if I'm going to research tax law for Grex, process the 500 message backlog in my staff mail, work on Backtalk, or maybe do some paying work. I have to prioritize things. How much priority I give to researching this issue depends on how worried I am about it, and how much good I think it will do. So far, nothing you've said has convinced me to worry very hard, and since I don't really understand the position you are taking, any research I do to try to prove or disprove it is likely to prove worthless anyway. I'm not "afraid to be proved wrong". I have lots of experience with being wrong, and if you do prove me wrong, I'll deploy my tried and true strategy for such cases - I'll change my mind and henceforth be correct. You aren't pushing my patience. I'll be happy to respond to anything. If I find it convincing, I'll be convinced. So far the few sentences you've entered supporting your case have not overwhelmed my own opinions, but you needn't take that as condemnation - it's not as if you've actually presented your argument yet.
janc, can you also put on your back burner the guide paper on 'how to respond to aaron'? It needs to be posted on M-net. Thank You.
<chuckle>
I have never found anything Jan wrote offensive to anyone, and don't see how
anyone could have read anything offensive into it. And I admire how patiently
he has managed to deal with all sorts of questions.
.
Then there is that nagging issue about how we filled out the application to be retroactive to the beginning of time. (Cyberspace Communications Inc, time). And that other nagging fact that the IRS accepted our application without ammendment or comment. These seem to be big red letters screaming from the wall that this argument is pointless. Maybe some loud voice in this item should calm down and think about the info we have before demanding we run all over the planet getting more info. This all came out more inflammatory than I intended, but I've been pretty inflammed.
Definitely don't depend on the IRS for right answers, especially via the telephone. They've a proven track record of handing out terrible advice.
Re resp:106 - Actually Aaron has acknowledged those facts, and that Grex has the retroactive right not to have paid taxes. His claim is that the same may not apply to the right of other people to deduct their donations to Grex from their taxes. Every proof I've seen of the retroactive status refers only to our "tax-exempt status" and does not explicitly mention "deductability of donations," so Aaron's claim is not directly defeated by any of it. However, I've always assumed that having tax-exempt status implies absolutely that donations are deductable (within the usual limits), and I have never seen anything to indicate otherwise except Aaron's bald statement to the effect. I feel that if something that important isn't mentioned in all the publications I've read, then it is either because the IRS has been seriously remiss, or because it doesn't exist. I believe the latter, but cannot absolutely deny the possibility of the former. It would take more research to prove one or the other of us right.
The response from the IRS to a general inquiry was to refer me to page 13 of Publication 557, which indicates that ordinarily, if an organization applies for an exemption more than fifteen months after its creation, the exemption is effective retroactive to the mailing date of the application. I have not seen anything to the contrary, outside of Jan's bald statements. I would want to reveiw all of the relevant documentation, and perhaps to make a specific inquiry with the IRS, before declaring that the standard rule does or does not apply in the present circumstance.
Aaron, if you want to retroactively deduct your donations to Grex, you should consult your tax advisor. Grex staff is not in the position to provide any more information than they have about what the papers we received from the IRS say. Apparently they allow people like you to deduct their donations back to the beginning of Grex. I'm sure anyone for whom this is a serious question has a tax advisor that they can trust to advise them in light of their own financial situation. For those of us who are not seriously considering redoing our tax returns, it is a waste of staff time to continue asking for information that we have no intention of making use of.
Consulting a tax advisor is a far better move than consulting the IRS directly anyway. As Marcus said above, the IRS has aterrible track record with the advice they give over the phone and they refuse to be held to it in case of dispute. That being the case, a tax advisor can at least back up the advice with specific reasons and represent us in case of dispute. Then again, as Colleen says, why chase down information we don't need...?
I am sure Mark could have told this story better, but here is a brief summary
of Kiwanis' Electronics Dept's adventures with Ameritech.
We have been testing out computers with Netscape, on the one Kiwanis phone
line, and kept getting bumped off due to call waiting. Nobody in charge at
Kiwanis knew why we had call waiting so Jim was given permission to call
Ameritech to cancel it. He had no problem cancelling call waiting, just told
them the phone number and his name.
In connection with our move to a new room, we were also given permission to
get a new phone line installed so that we would be able to test out phones
and answering machines by calling between the two numbers (and not get bumped
off line when anyone picked up the phone). Jim set up an installation date
and time and was told to be there Thursday before May 1 from 8 to noon. To
get a new line he was required to spell out his complete name as the contact
person, and to given them the main phone line in the building, which is on
the corner of First and Washington St. in Ann Arbor.
After nobody showed up by 1 he made a few phone calls and eventually learned
that the installer had been sent to Kiwanis pre 1965 address on Fourth Ave,
which Ameritech had as the Kiwanis address for the phone number given to them.
(One wonders where the bills are being sent to). Jim had given them the
current address. Eventually the new phone got installed, as tone phone.
Today Jim asked me to call and change it to pulse phone. They could not find
the number (Jim had reversed two digits) so asked for the service order
number. When I called back with it they said they had no record of the
service order number, and never keep that record once the phone is installed
(this is a different and more clever person on teh second call). Jim figured
out the correct number and they asked for my name and said it did not match
the name on the account, which had to be the name on the main number. They
could not tell me the main number or the name. It was not Jim Deigert.
Eventually they parted with the first name, someone we had never heard of.
I put Jim on the phone and he explained that Ameritech seemed to be using a
very obsolete address for Kiwanis and possibly the person whose name they had
was no longer alive, and it was his name that was supposed to be on the
account. They relented and gave him the person's name, which we never heard
of. They still refuse to give us any information about charges other than
$13.20 plus taxes and they cannot tell us the taxes because our name is not
on the account. Plus 8.53 cents/call because it is a business account because
we are using it to sell things. (We are not exactly using it to sell things,
just to test them out).
Jim left a message for the person who he thinks is in charge of the
other telephone number to call back and help fix the situation. Anyway,
Kiwanis is probably eligible, as a non-profit, not to pay the taxes, whatever
they may be. (We still cannot imagine why they cannot tell us how much state
and federal tax is paid on a typical business account unless we are the actual
person associated with a particular account.) We may be asking for Mark's
help filling out some forms for this.
Do businesses have to pay extra to have an unlisted number?
Let me know, Sindi, and I'll give you the name of the tax person at Ameritech who fixed up our account. You might want to refer it to the person who pays the phone bill, though; s/he will probably want to do the same thing for all Kiwanis's lines.
TWo of the three lines are probably eligible, the other line is for the club, not the non-profit foundation. Thanks. We may want to call out on the non-profit line to save paying taxes on each 8.53 cent call. Mark, do you know the monthly charge including taxes for a business line? Jim called the current Kiwanis Club secretary. The phone company apparently had his name along with that of a former secretary and he gets the bills. He will call and ask them to put Jim's name on instead of the former secretary so that Jim can call and find out how we are being billed, and he will also ask about the other line (unlimited or per-call charges). I will now attempt to call and get some general information on the costs of a business line.
The pricing is quite complicated, Sindi, and it fluctuates often. It shouldd be about $20 per line, all told.
I called and got someone intelligent this time. $20/line plus 8.53 cents per
outgoing call plus 3 percent federal and 6 percent state tax. She defined
a business as any place without both kitchen and sleeping area. (The previous
unhelpful person said it is a business if it makes money). She offered to
mail the tax-exempt form to the mailing address for the Kiwanis numbers and
never once asked our names, just the phone numbers. Tax would be on the base
rate plus all calls and we may be exempt from all tax on all three lines.
We may ask for help with the forms when they come. Make that about $19-20,
she said it depended on our phone number and other things. All business lines
require that you pay per call, unfortunately. What we really need now is some
sort of null-modem type arrangement (an internal phone connection) to test
out fax machines and answering machines on, with no per-call fee. JIm has
schematics for building something like that, he says it is not simple. Does
anyone know a simple way of doing this?
We would then only need the phone lines for grex/Netscape and could
use our little box to test equipment on, even modems.
WOuld anyone like to build one of these for us from the schematics?
It would be a good high school science project, says Jim. We could issue
credit for it maybe.
I would certainly like to see the schematics, although I can't promise anything.
Business lines tend to get much better repair response than residential lines do, which I'm sure is one reason why lots of people with businesses in their homes still get business lines.
Actually, you can install a "business" line at home, even if you have both a kitchen and a sleeping area at your home. On the other hand, you can't necessarily install a "personal" line at work, even if your work happens to have both a kitchen and a sleeping area (as do many hotels.) You can get a centrex system to avoid the per-call phone charges (station to station calls don't get charged). Centrex may or may not be cheaper on an overall basis; you have to add everything up to see which one comes out ahead.
But there's at least a $20 overhead charge for having a centrex account, so for 3 lines I doubt it's worth it, unless you make a lot of calls between the numbers.
Re 116/117: it shouldn't be too difficult. Between two modems on computers it would be simple - just have to command the modems to go off hook and then connect. But I don't think you can command a FAX machine to go off hook except by hitting it with a ring. I'd be interested in that schematic too.
Jim will look for the schematic and mail or fax copies to you both. If we can get this thing built it should only be 10-20 real calls on our new line. Per month. Jim could not find it, but it was from an old issue of Electronics Now magazine which the library may still have. $20 centrex charge divided by 8.53 cents = 234 calls. We don't test quite that many phones, answering machines, faxes and modems per month.
Re somewhere back there: You did NOT have to cancel the call waiting! Dialing *70 on tone service, or 1170 on pulse service, disables it for the next phone call. Of course, if you need the regular traffic to get through, this may not be an option.
We were doing this but it was a nuisance, and since nobody had ordered call waiting or was using it or wanted it we cancelled it.
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I have not heard of this. Usually they charge per month for the call-waiting service.
What should happen with call waiting is that you get billed by the month to ahve it. With other services, you get billed by the month, or per use.
You have several choices: