sean@ms.uky.edu (Sean Casey) (04/01/91)
Here's my solution: Treat pay BBS services as a business. They pay business phone rates. They must file taxes as any other business. That's what they are, and they should not be allowed an exception. Those that make no profit should file for a non-profit tax status. Once the IRS approves it, they can again pay residential phone line rates. And their customers can tax-deduct their BBS fees too! Sean -- ** Sean Casey <sean@s.ms.uky.edu> ** Recent news headline: "Compaq joins price wars"
randolph@cognito.Eng.Sun.COM (Randolph Fritz) (04/01/91)
Sean, currently small non-profits (annual revenues less than $5,000/year, which describes most BBSs) are simply ignored by the IRS. It takes about a year, and quite a bit of paperwork, to get recognized as non-profit by the IRS; that's if you're some type of organization they understand, which probably isn't the case for BBSs. Your recommendation would have what is called a "chilling effect" -- if you need a tax lawyer and a year's negotiation with the IRS to run a BBS at a reasonable price, most BBS operators will probably just not bother. nd t ou ui R Press T __Randolph Fritz sun!cognito.eng!randolph || randolph@eng.sun.com ou ui Mountain View, California, North America, Earth nd t
peter@taronga.hackercorp.com (Peter da Silva) (04/01/91)
sean@ms.uky.edu (Sean Casey) writes: > Those that make no profit should file for a non-profit tax status. > Once the IRS approves it, they can again pay residential phone line > rates. And their customers can tax-deduct their BBS fees too! No good. Non-profit organizations pay business phone rates too. In fact when Southwestern Hell was trying to put all BBSes under business rates, they would call up BBS operators and ask them: "Are you a business or non-profit?". This was a trick question. The correct answer was "neither: this is a hobby.". -- (peter@taronga.uucp.ferranti.com) `-_-' 'U`
rogue@cellar.UUCP (Rogue Winter) (04/04/91)
sean@ms.uky.edu (Sean Casey) writes: > Those that make no profit should file for a non-profit tax status. > Once the IRS approves it, they can again pay residential phone line > rates. And their customers can tax-deduct their BBS fees too! > > Sean > -- > ** Sean Casey <sean@s.ms.uky.edu> > ** Recent news headline: "Compaq joins price wars" I have few problems with local BBS services that charge a fee for extended services. (I must - I'm on one now.) As long as the service is fairly priced and has a unique value, and there are no connect charges, then pay services have some validity. For example, I pay $35 for a six-month subscription to the Usenet feeds. I consider this a great price for a public node. Of course, I also know the sysops - but this doesn't give me a price break. As to the non-profit status of BBSes, most are already run at a loss - if I had to guess, I would say that less than 2% of the charging systems out there put the user fees in the sysop's chocolate fund. Most fees go into hard drives, multiplexers, and higher-speed modems. Any non-profit organization must first raise $500 to register with the IRS forthe special tax status (if this doesn't come under usury, nothing does). I'd much rather see that $500 go for a hard drive or a 9600 baud modem than for bureaucrat appeasement.
scratch@hpb.cis.pitt.edu (Steven J. Owens) (04/10/91)
In article <10768@exodus.Eng.Sun.COM> randolph@cognito.Eng.Sun.COM (Randolph Fritz) writes: >Sean, currently small non-profits (annual revenues less than >$5,000/year, which describes most BBSs) are simply ignored by the IRS. >It takes about a year, and quite a bit of paperwork, to get recognized >as non-profit by the IRS; that's if you're some type of organization >they understand, which probably isn't the case for BBSs. Hm... this brings up a thought... what about setting up some sort of umbrella organization for BBSes. To belong the BBS MUST be non-profit, and then organization files for non-profit status? I know absolutely nothing about tax law, accounting, etc, just a random thought that occurred to me. Is this feasible/possible? If so, it might make a lot of sense for a variety of similar purposes, banding together for mutual benefit and self- protection much as other special interest groups do... Steven J. Owens | Scratch@Pittvms | Scratch@hpb.cis.pitt.edu "We talk often - and sometimes rather glibly - of freedom of speech, freedom of expression, freedom of the press. But are these things really free? Or are they borrowed with the promise that they are ours to use as long as we treat them as the precious, complex, and fragile things they are?" - Charles Marshall, vice-chairman of AT&T