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Charitable Work - What are the laws?

by svedski
4 replies
I was thinking of doing charitable work by starting a help organization.
The plan is to do this by DM.

The question is, how much of the donations can I keep as salary for my work?
Lets say for instance that in the mailpiece I never say "Every penny that you donate will go straight to the cause", but instead I just say "Help us by donating, and we will help the cause in return" or something like that.

What are your thoughts?

To your knowledge: My plan was to split the donations 50/50.
And this is of course only of the profits, after overhead (which will be at least 50 percent in itself). So basicly, if I get 100,000 USD, 50,000 will pay for overhead, 25,000 to the cause and 25,000 to me.

Is that illegal or is that OK?
(Morality: I take the risk with my own money, I spend countless hours writing a mailpiece and actually collects money for a good cause that wouldn't have been if I hadn't taken the initiative.
I should be payed for my work. The contributors are happy because they feel like they did something good. The cause gets money, I get money and the donators feel good about themselves. Everybody wins.)
#charitable #laws #work
  • Profile picture of the author Aaron Doud
    In the US you would need to make a charity which in most (all?) states requires a board of directors.

    You can pay yourself whatever you want but I think the IRS might come after you with a 50% commission. You'd be better paying yourself a pure salary even if that ate into more than 50% of the charity the first year or two.

    Just remember your charity's financials will be public knowledge. You skirt morality too much and you are likely to be on the local news.

    So if you want to form a charity to create a job you better make sure it can stand up to scrutiny.
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    Aaron Doud - Sales & Success
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  • Profile picture of the author bizgrower
    You should be able to get a free consult with a local CPA
    or lawyer or non-profit advisor.

    You could also just donate to this cause?

    Dan
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    "If you think you're the smartest person in the room, then you're probably in the wrong room."

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  • Profile picture of the author Andrew H
    I was looking into starting a service like this, where people could accept donations for their charity and I would take a cut at checkout. During my market research I discovered there is already some competition: Instant Websites for Nonprofits | Bellstrike

    What you want to do (ie: take a percentage), is very standard in the 'donations' world - a finders fee. Those people that go door to door, for the most part, do it for the commission money which I have heard can range anywhere from 10-50%. It might be easier to partner with an existing charity rather than starting your own though, that way you can avoid most of the legal hoops.
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    "You shouldn't come here and set yourself up as the resident wizard of oz."
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  • Profile picture of the author svedski
    Thanks a bunch, Aaron, Bizgrower and Andrew H.
    Contact a lawyer would of course be the obvious thing to do right here, and that's what I'm going to do.

    Sidenote: I really need to start contributing to other members soon.
    I feel I get help time after time but don't return the favour. It is coming though, so bare with me for a while longer! : )
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