teach a man to fish

April 19, 2001 1:33 PM

Keep the servers running smoothly today
 or
create a fleet of system admins for Metafilter tomorrow?
posted by fooljay to MetaFilter-Related at 1:33 PM (17 comments total)

I was going to donate to the Scholarship fund, but also wanted to donate to the server fund. However, since the scholarship fund was created from excess server fund monies, does that mean that the server fund is essentially closed?

Where's a fund manager when you need him? What's my rate of return? Are there tax consequences? ;-)
posted by fooljay at 1:35 PM on April 19, 2001

BTW, for those who missed it on the front page:



Cut & paste baby...
<a href="http://www.metafilter.com/scholarship.mefi"><img src="http://junk.metafilter.com/scholarship2.gif" border="0"></a>

Very cool...
posted by fooljay at 1:38 PM on April 19, 2001

oh well, you know, the server fund thing is always good, but if people want to give to the scholarship specifically, they can.

(there's another button on the scholarship about page, and I'm going to make at least one or two more)
posted by mathowie (staff) at 1:44 PM on April 19, 2001

A little from column A, a little from column B.

I love that button, btw.
posted by hijinx at 1:45 PM on April 19, 2001

So, Matt, are you saying that giving to the server fund is also giving to the scholarship fund? IOW, are you planning to regularly roll it over? Seems confusing IMHO. Hell, you have both funds set up. Let em stand on their own...

I got 10-1 odds on the server fund, btw
posted by fooljay at 2:37 PM on April 19, 2001

I hope you've got the tax implications worked out with all these funds, Matt.

Don't you need to get some non-for-profit type status?

posted by lagado at 7:02 PM on April 19, 2001

There are not actually two pockets here, there are three. And the third pocket has already been tapped pretty extensively, not counting time.

The server fund is theoretically affected by the router purchase, too. I mean, technically, since Matt already said the server fund is underwriting the scholarship fund, that money's coming out of some poor schmuck just trying to go to college. ;-)

But I would say that the scholarshp fund is doing well so far, and eventually maybe can stand on its own. Give where you want ... either one is going to do good.
posted by dhartung at 7:02 PM on April 19, 2001

I don't think Matt will need not-for-profit status as long as it's all handled under the geise of "We're picking one college student to give $x to."

Considering the banner ad, it's basically just money so someone can relax a bit while at school and spend time learning, as opposed to worrying about money all the time, I don't think there's any stipulation that y% of the money must go to tuition, etc.

It's just a helping hand to someone at a time when helping hands are especially helpful.

Though I think that after this one's awarded, it'd be worthwhile to look into setting up an actual savings account for the money and building it up to act as an actual fund.

A set amount of money (at least $500) gets paid out every year, and the overflow goes back into the savings account (and eventually into some kind of actual money-making scheme like mutual funds and whatnot) to make more money for next year.

Once a system like that is set-up, Matt will need to make it an official not-for-profit scheme so he doesn't get his ass kicked with Capital Gains taxes. Plus, by making it a registered charity, we could all donate to it as official charity donations, and use it as a loophole for our own taxes. Yay! :-)
posted by cCranium at 6:49 AM on April 20, 2001

IANATA (I Am Not A Tax Accountant) but... I think that, as an individual, the money Matt raises for the scholarship will be considered taxable income by the IRS unless the student he gives the money to happens to be a Federally-approved charity, in which case he can deduct it. In other words, fat chance. If he intends to be giving away large amounts of money on a regular basis, he definitely needs to talk to an accountant to see how to avoid tax liability for this.
posted by kindall at 11:08 AM on April 20, 2001

Interesting point, kindall. If the accountant can't come up with a good way to avoid liability, though, I think taking enough from the donations to cover the taxes would be entirely ethical.
posted by lbergstr at 12:22 PM on April 20, 2001

Errmmm, yeah. Hey! Who left that can of worms sitting there all open like that!? Oh. nevermind...
posted by fooljay at 1:01 PM on April 20, 2001

God taxes suck.

I'm giving money away. People are giving me more everyday, and I'm giving it all away. If the gov't wants a cut, they can fuck right off. I'm not reporting anything about this because it's small and strictly an act of benevolence.

...but I suppose if it caught up with me, I'd cover it all myself. StupidfuckingIRSandtheirgoddammedlaws...
posted by mathowie (staff) at 1:58 PM on April 20, 2001

Oh, and I guess it was a bit premature to say stuff like "annual" because yeah, it'd be better if amazon and paypal weren't getting cuts of the money, that it was making interest while it waited for its intended recipient, and that it was all hunky dory with uncle sam. But I hate administrivia (anyone else want to do the icky parts of this?)

I guess the whole point of doing it was to do something nice for others that I've always wanted to do, and as a small side benefit, to inspire others to do stuff like this. Others inspired me to do crazy stuff like this, and part of me hopes I get to pass it along in the process.

Selfless acts mediated by the web are about the greatest things on earth. You don't have to limit your web involvement to goofing around with little ego-boosting personal sites, you can actually touch lives and make people's time on earth a little easier with the web.

Lance said it a couple weeks back, get out there and do cool shit. Go!
posted by mathowie (staff) at 2:08 PM on April 20, 2001

Amazon reports the money they pay me in affiliate fees to the IRS. If the same is true of the Honor System, you're going to have to account for it in some way or it will be considered income.
posted by rcade at 4:34 PM on April 20, 2001

ouch. ok, I'll keep my eyes peeled and look into various solutions for this year.
posted by mathowie (staff) at 4:52 PM on April 20, 2001

There have got to me some CPA types who read Metafilter...

I just did a search specifically looking for a certain type of service: One which acts as a directed non-profit agency. In other words, if Amazon held non-profit status [*snicker*] we would give the money directly to the MeFi scholarship set up by Matt with Amazon. At some point, Matt pulls the trigger and Amazon gives the money to someone. It doesn't seem like this would be a problem, since the money never touches Matt's hands.

Of course, I think drug smugglers call this money laundering...

By the way, if a site ever needed a full-site search it irs.gov. That thing is ridiculous...

Good links to start with here and here...

I'll keep looking....
posted by fooljay at 5:44 PM on April 20, 2001

It occurred to me that if MeFi were accounted for as a business venture, you might be able to write off the scholarship as a marketing expense, as it does draw a lot of attention to the site. (No, that's not why you're doing it, but from an accounting standpoint it would be legitimate, I think.) You could also then deduct the costs of running MeFi from any money you make running it. However, for that to work, you'd have to actually make a (small) net profit running MeFi three out of five years to keep the IRS from classing it as a hobby and disallowing your deductions. That could be a tricky line to walk -- especially if donations generally don't cover expenses. (If they do, then every December you just spend most of the leftovers on site upgrades.)

IASNATA... (I Am Still Not A Tax Accountant)
posted by kindall at 12:02 PM on April 21, 2001