@RUTGERS.ARPA:AXLER%Upenn-1100%upenn.csnet@csnet-relay.arpa (03/06/85)
From: "Don't worry, I'll tell you later." <AXLER%upenn-1100.csnet@csnet-relay.arpa (Don't worry, I'll tell you later.)> In a recent issue, a reader commented that the phrase "NESFA, Inc." implied that the group exists to make a profit, since they're incorporated. Sorry, but that's an unfounded assumption, as they may well be a non-profit corporation, as most faanish institutions tend to be (e.g., the WorldCons now incorporate in this fashion, as do many local clubs, esp. if they intend to own property/libraries/mimeo machines or to spend large amounts of money, as in putting on a con). The purpose of incorporating as a non-profit is simple: it protects the individuals who work for the group. For instance, if a convention were put on by an unincorporated group, and it lost money, *every* individual who could be proven to have worked on that con -- even in an unpaid volunteer position -- could be hauled into court by the convention's creditors. If the group is incorporated, then no individual is liable for the group's debts. (However, if an individual associated with the group commits a crime with the group's funds -- embezzlement or fraud, for instance -- then that person can be tried.) The precise mechanism by which a group becomes a non-profit corporation is defined by state law. Once a group has incorporated, though, they can also apply for tax-exempt status at both the state and federal levels. In most cases, this is done on the grounds that the group is, in some way, serving an educational or cultural purpose, as defined in section 401(c)(3) of the Internal Revenue Code, though there are lots of other legal reasons for being considered tax-exempt -- fraternal groups, religious organizations, and so on. By the way, being a "non-profit" corporation doesn't mean that you're\ trying to lose money. Rather, if the group makes money, the profit is not then distributed to the corporation's "owners", but used to further the pur- pose that was stated in the groups Articles of Incorporation. So, if NESFA feels that setting up a permanent structure for their clubhouse will help in some way to fulfill the formally-stated goals that are in their charter (and this is almost certainly the case, since such goals are usually stated in a manner that allows broad interpretation), then their stated plan of using any Boskone profits to help build/buy/furnish such a clubhouse is not only reasonable, but laudable -- they're doing exactly what they told you they were going to do. If you don't like the way NESFA goes about setting and fulfilling its goals, the best thing you can do is to join and raise your voice at meetings. Using sf-lovers as a forum is probably a waste of time, since this tends to be a collection of readers, not of faans -- the typical total attendance at the annual sf-lovers party at Worldcon, from what I've seen, is less than a hundred, and there are many, many more readers out there . . . --Dave Axler