[TheThinkTank] Fancy Parts

Thu May 8 07:43:06 PDT 2008

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     Hi, Everyone.

         This thread is great. Your are all so knowledgable it
makes me happy. Does anyone know what the tax rules are for
Canadian shops who want to raise money selling "fancy parts"?
          Sasha


On Thu, 08 May 2008 10:28:16 -0400 Stuart O Anderson
<soa at ri.cmu.edu> wrote:
>Colin's experience is similar to ours.  Because our nonprofit
>status
>comes from another organization that we're part of, our income is
>combined with theirs in deciding whether we cross that limit.  We
>do
>cross it and pay sales tax on all our sales.  Being a non-profit
>means
>that the organization isn't owned privately or publicly by folks
>who
>make a share of the organization's profit - a non profit is still
>free
>to pay its employees and charge as much as the market will bear
>for
>its goods/services.
>
>>From the IRS website, the requirements for tax exemption are at:
>http://www.irs.gov/charities/charitable/article/0,,id=96099,00.html

>
>
>The bit that says what a 501(c)(3) may actually _do_ is below:
>
>The exempt purposes set forth in section 501(c)(3) are charitable,
>religious, educational, scientific, literary, testing for public
>safety, fostering national or international amateur sports
>competition, and preventing cruelty to children or animals.  The
>term
>charitable is used in its generally accepted legal sense and
>includes
>relief of the poor, the distressed, or the underprivileged;
>advancement of religion; advancement of education or science;
>erecting
>or maintaining public buildings, monuments, or works; lessening
>the
>burdens of government; lessening neighborhood tensions;
>eliminating
>prejudice and discrimination; defending human and civil rights
>secured
>by law; and combating community deterioration and juvenile
>delinquency.
>
>
>There's also a section that says you're not allowed to 'inure'
>(pay)
>people associated with the organization to excess.  So, if you're
>selling dura-ace brakes on ebay for as much as you can, but using
>the
>money to pay your volunteers for their time at a reasonable rate
>and
>improve you're shop (both activities being part of your
>'charitable
>purpose') then you're all set.
>
>Stuart
>
>On Thu, May 8, 2008 at 9:40 AM, Colin Dixon, Phoenix Bikes
><colin.phoenixbikes at gmail.com> wrote:
>> Income from sales is usually not tax exempt income - unlike
>donations - so
>> that may complicate things. and it is a bit dicey to give
>something to
>> someone and then have them give a 'donation' in return.
>> That said, usually states have a level below which you don't
>have to file
>> sales tax. In VA, I believe its $10,000 a year.
>> therefore, If you don't sell over $10,000, you don't need a
>license to sell
>> stuff and don't need to file. If you do sell over, you need to
>both register
>> to sell stuff (can still be a non-rpofit), and to file monthly
>to pay sales
>> tax.
>> Could be a little off on this, but I think this is the gist.
>> - colin
>>
>> On Thu, May 8, 2008 at 9:08 AM, Justin Pogge <xecax at hotmail.com>

>wrote:
>>>
>>> we have a special display for nicer parts that we want a larger

>donation
>>> for. we have a number of parts hounds that come to our shop to
>see what new
>>> goodies we have. selling parts like this really helps us out
>financially and
>>> lets us have more wiggle room when it comes to people not
>having very much
>>> money to donate for the bicycle that they fix up in our shop.
>plus, our
>>> mechanics can benefit from these parts by donating to their own

>coop and
>>> getting parts for much less than they would at a LBS.
>>>
>>>
>>>
>>>
>>>
>>> ________________________________
>>> > From: bbohs at purdue.edu
>>> > To: thethinktank at bikecollectives.org
>>> > Date: Wed, 7 May 2008 23:05:10 -0400
>>> > Subject: Re: [TheThinkTank] Fancy Parts
>>> >
>>> > If you want to indulge in profit, I hear you too.  Make your
>classifieds
>>> > intellectual to me, and I'll try to make them open for fair
>trade.  Let me
>>> > know.  Thank you for helping out the community, even for
>individuals who are
>>> > as accomplished as some.  Thank you
>>> >
>>> >
>>> > Brent Bohs
>>> >
>>> >
>>> >
>>> >
>>> > On May 7, 2008, at 10:58 PM, Brent Bohs wrote:
>>> >
>>> > Thank yo man, you seem to understand how this works.  I you
>have
>>> > profitable items, sell them at what you want.   Otherwise,
>name a price and
>>> > let the masses indulge in your success.   Let them know.  We
>can all benefit
>>> > from riding and people that help the whole ordeal are saints
>to me, man.
>>> >  You know you are doing so much for others.  Give me a shout!

>765-418-1272,
>>> > if you want to help the biking community more, I'm sure I can

>help you out.
>>> >  We, at this co-op, don't enrich ourselves, but we sure
>enrich any biker we
>>> > find in free or cheap parts, labor, and well-being, as we are

>trying to
>>> > promote biking as a safe and justifiable alternative to car
>traffic.
>>> >
>>> >
>>> >
>>> > Brent
>>> >
>>> >
>>> > On May 7, 2008, at 5:10 PM, james blesdoe wrote:
>>> >
>>> > HECK NO!!!
>>> >
>>> > You sell them as you see fit.  Nonprofit means you can't
>enrich your
>>> > self, but your organization is supposed to make a profit   In

>this economy
>>> > that is becoming easier all the time -at least at the Bicycle

>Kitchen  that
>>> > is the case.
>>> >
>>> > roll on
>>> >
>>> > Jim
>>> >
>>> > Erik Stockmeier> wrote:
>>> > Question!
>>> >
>>> > What the heck does everybody's shop do with fancy items of
>special worth
>>> > to collectors?  For example... perhaps you come upon a
>donation of half a
>>> > dozen 70s unused campi sidepull break sets.  Your stock of
>breaks is full,
>>> > so throwing them in the bin or selling them for 5$ or
>shlepping them on a
>>> > Roadmaster seems like a waste.  Is it ethically ok for a non-
>profit to
>>> > occasionally indulge collectors as a source of surplus
>income?  What about
>>> > legally for a 501c3?  Is it necessary to launder them through

>a "buyer" who
>>> > sells them at profit and donates the difference?
>>> >
>>> > Erik
>>> > _______________________________________________
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>>> > Thethinktank at bikecollectives.org
>>> >
>>> > http://lists.bikecollectives.org/listinfo.cgi/thethinktank-
>bikecollectives.org
>>> >
>>> >
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>>
>>
>>
>> --
>> Colin Dixon
>> Phoenix Bikes
>> Barcroft Park
>> 4200 S. Four Mile Run Drive
>> Arlington, VA
>> www.phoenixbikes.org
>> (703) 575-7762
>> c: (202) 494-9553
>> _______________________________________________
>> Thethinktank mailing list
>> Thethinktank at bikecollectives.org
>> http://lists.bikecollectives.org/listinfo.cgi/thethinktank-
>bikecollectives.org
>>
>>
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