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CBS/Paramount sues to stop Axanar

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carlosp said:
Except this isn't really about fraud, is it? Isn't more about whether they should qualify for the tax exemption?
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Yes, these are separate (if not unrelated) issues.

You correctly characterized the differences between nonprofits above $200K and below $200K. Some nonprofits, particularly one-person passion projects with an executive director but no staff, purposefully keep revenue under $200K to prevent greater scrutiny. In many cases, it's because these nonprofits have terrible bookkeeping practices. In a few cases, it's because they've spent the money in a way that would raise questions. In Alec's case, I suspect it would be both (if he bamboozled the IRS into providing Axanar an exemption).

I would kill to see an Axanar Productions 990, though... especially the accomplishments section.
 
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A wee bout?

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carlosp said:
Instead, they would file the the Form 990-EZ — the "short form" of the 990 — or even the Form 990-N, filed by organizations with gross receipts of $50,000 or less.
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The IRS tends to be very particular in its wording. If it's actually specified as "gross receipts", then that horse left the barn a long time ago. Not sure what the breakdown is of what was received in which year, but I'd bet it's much more than $200K for 2015.

No amount of divestment will stop that distinction. They received the money; what they did with it and if they still have it are two entirely separate issues.
 
Ion said:
The IRS tends to be very particular in its wording. If it's actually specified as "gross receipts", then that horse left the barn a long time ago. Not sure what the breakdown is of what was received in which year, but I'd bet it's much more than $200K for 2015.

No amount of divestment will stop that distinction. They received the money; what they did with it and if they still have it are two entirely separate issues.
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Truth. If the entity through which he's applying for nonprofit status (is that "Axanar Productions?") took in more than $200K in 2015, he'll have to wait a year to get the benefit of the less-intense review (assuming he takes in less than $200K in 2016). And at that point, this is probably a non-issue because Alec will already be buried. Does anyone remember the breakdown of funds across years?
 
Ion said:
The IRS tends to be very particular in its wording. If it's actually specified as "gross receipts", then that horse left the barn a long time ago. Not sure what the breakdown is of what was received in which year, but I'd bet it's much more than $200K for 2015.

No amount of divestment will stop that distinction. They received the money; what they did with it and if they still have it are two entirely separate issues.
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RCAM said:
Truth. If the entity through which he's applying for nonprofit status (is that "Axanar Productions?") took in more than $200K in 2015, he'll have to wait a year to get the benefit of the less-intense review (assuming he takes in less than $200K in 2016). And at that point, this is probably a non-issue because Alec will already be buried. Does anyone remember the breakdown of funds across years?
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Nonprofit budgets need to show little or no profit each year, and they need to have a budget correlating their planned and most recent cashflow with their declared exempt activities upon filing. I think it might be a bit difficult to make this case for last year given they weren't really doing exempt activities as far as it seems to me.

They insist they were operating as a nonprofit, so it will be interesting to see if their application, which has to state their exempt purposes, can justify just making the film and soundstage as exempt activities. The IRS (according to LegalZoom) says they can claim to be a nonprofit from the time they file as nonprofit with their state, regardless of any 501c3 Federal application status. But has that application shown up yet? Maybe they are filing under an obscured name in order to avoid people analyzing their activities? Is Axanar Productions dba as anything?

My guess is they have to give last year a pass, and this may in turn show them up as not speaking truthfully to donors in saying they were operating as a nonprofit last year.
 
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RCAM said:
I would kill to see an Axanar Productions 990, though... especially the accomplishments section.
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Their initial application will be almost as good since it may contain a mission statement, and as far as I know must identify and justify their activities as exempt.
 
RCAM said:
Truth. If the entity through which he's applying for nonprofit status (is that "Axanar Productions?") took in more than $200K in 2015, he'll have to wait a year to get the benefit of the less-intense review (assuming he takes in less than $200K in 2016). And at that point, this is probably a non-issue because Alec will already be buried. Does anyone remember the breakdown of funds across years?
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You can figure out the year-by-year income from crowdfunding from the overview on AxaMonitor.
 
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muCephi said:
Nonprofit budgets need to show little or no profit each year, and they need to have a budget correlating their planned and most recent cashflow with their declared exempt activities upon filing. I think it might be a bit difficult to make this case for last year given they weren't really doing exempt activities as far as it seems to me.

They insist they were operating as a nonprofit, so it will be interesting to see if their application, which has to state their exempt purposes, can justify just making the film and soundstage as exempt activities. The IRS (according to LegalZoom) says they can claim to be a nonprofit from the time they file as nonprofit with their state, regardless of any 501c3 Federal application status. But has that application shown up yet? Maybe they are filing under an obscured name in order to avoid people analyzing their activities? Is Axanar Productions dba as anything?

My guess is they have to give last year a pass, and this may in turn show them up as not speaking truthfully to donors in saying they were operating as a nonprofit last year.
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I checked California's charitable organization database at the secretary of state's website, and there was no Axanar or Axanar Productions there.
 
wtriker1701 said:
"And as has been clearly said many times, Axanar actualy PAYS people, because it is a professional production, and doesn't use volunteers for the daily labor (sure volunteers help out, but full tiem employees, are paid."
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But not everyone was paid, right? I don't know how many people worked on a real movie for free, but I'd bet only interns.
 
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