SUO: 501(c)(3) status of IEEE
After some referral through the channels suggested by Jim Schoening, I
have confirmed with the standards office of IEEE that they now operate
most standards work under a 501(c)(3) rubric not a 501(c)(6) as Frank
Farance and I (deferring to his expertise) had assumed. What Frank
probably had in mind was IEEE/ISTO work in which he also participates.
IEEE/ISTO work is indeed done under the (c)(6) rubric, I have been told by
the standards office.
A 501(c)(6) organization is a tax exempt but not tax deductible business
league. A 501(c)(3) is a tax deductible rubric that covers universities
and research foundations, among other charitable activities. A (c)(3)
imposes a somewhat more stringent standards of disclosure, openness and
publication, as well as requiring a strict distinction between charitable
activity, on the one hand, and lobbying and business activities, on the
other. These latter activities are not entirely prohibited if properly
declared and limited.
To give a flavor of the distinction, I have been informed by competent
counsel, for example, that with respect to volunteer activity if a
significant activity of a 501(c)(3) is conducted by a for-profit firm on a
volunteer basis and used to build its for-profit activity, the tax
exemption of the (c)(3) organization may be called into question by the
IRS if this is a significant portion of the (c)(3) activity. For a (c)(6)
organization this would not be as salient an issue, since the purpose of a
(c)(6) is to serve the collective interests of a business community,
though even here there are limits to the inurement of material advantage
to participating members.
Within the IEEE (c)(3) standards work it is crucial that members
participate formally as individuals rather than as representatives of
corporate interests. If not, they would form a consortium and fall under
the (c)(6) rubric.
I am sending a copy of this email to the standards office to make sure I
have it right, and I will share any corrections that are made, in case the
issue affects others. This has been an issue for me personally, as I have
had to choose between participation in SUO on purely procedural grounds
appropriate to a limited "business" role, or on intellectual grounds in
connection with a philosophical project sponsored by foundation grants.
Lee
Josiah Lee Auspitz
lee@textwise.com
17 Chapel Street
Somerville, MA 02144
617-628-6228
fax -9441
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