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Tax law benefits?

Discussion in 'BlackHat Lounge' started by bushbabie21, Mar 21, 2012.

  1. bushbabie21

    bushbabie21 Executive VIP Jr. VIP Premium Member

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    Hi folks,
    I am thinking about starting a small charity to help find and support the "untapped Genius" in everyday people or people that might otherwise just end up in a dead end job or unemployed. The concept is to offer services that we help these people develop to companies and individuals that are looking for these services. We use the money to further help these ordinary people grow and establish their businesses in the hopes of create trajectory changing ventures and jobs in their communities.

    I have thought hard about this and need help with one important factor: "tax incentive". The idea is to offer these companies the services and being a legal 501 c 3 charity, allow them to write these expenses off. Now i know that corporations and even smaller entities like llc's and sole proprietorships can write off business expenses...but the question is this: Is there a benifit i can provide tax-wise becuase i am a charity vs these companies just paying for a given business expense and writing it off?

    THanks in advance for the help!
     
    Last edited: Mar 21, 2012
  2. bushbabie21

    bushbabie21 Executive VIP Jr. VIP Premium Member

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    Especially interested in input from Winchester as he seems to have a solid business and accounting background.
     
  3. Winchester

    Winchester BANNED BANNED

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    Should have PM'd me I would have totally found this sooner!

    Anywho, yes writing off a charitable donation is significantly different for a business than a business expense. In most situations they get to write off the entire value (if not then at least a greater value) than if it was just a business expense.

    It all depends on your country/state.

    The main issues you will face is starting a charity and the continued auditing that ensures your operations are actually meeting some form of charitable gain for the community.

    Personally here in Canada the hoops you have to jump through to create a charity will require you to hire a lawyer (and this is coming from someone with legal experience who has written extensively on legally matters here on BHW).

    If ya let me know your state or country I can have a quick glance and see if I can give you any more insights.

    I wish you all the best with the venture because if it is an actual charity rather than a job scheme or tax fraud - then it sounds like a good cause to me.