Random 501c3 musings, from current tax class

It has always made me grimace to hear folks say that we can’t make money, because we’re a non-profit. Here’s part of a general definition of a “public charity”
"Normally receive more than 1/3 of their support from contributions, membership fees, and GROSS RECEIPTS FROM ACTIVITIES RELATED TO THEIR EXEMPT FUNCTIONS **, and not more than 1/3 of their support from gross investment income and net unrelated business income.

Since we’re organized as an educational non-profit, activities related to our exempt functions could include fees for classes. I am not advocating that we start charging significant fees (more that $5-20/student), but it wouldn’t impact our non-profit status. And, if we consider selling T-shirts as “unrelated business income”, we’d have to sell a boatload before we hit the 1/3 mark.

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Good info.

On a related note, DMS has more armchair lawyers afraid of their own shadows than I’ve ever seen in one place, ever.

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