Quote from: Darkbane on February 24, 2014, 03:24:52 am

Shouldn't we demand invictus become a legally registered non-profit organization before we start creating a pyramid of forks for them to get cash flow from again and again? I mean if we're about protecting the community, shouldn't we start with them to protect us?

I say this because currently... they are a for-profit company... which means all these "donations" get taxed... do you think its right for them to pay 40-50% of taxes on our donations... when if they were a non-profit they would not be taxed at that rate and more of our money would be used for us?

that one step alone could save millions over the course of a year with the amount of money they are getting...

The federal government imposes a tax on gifts larger than a certain amount. This tax is paid by the person giving the gift, not the recipient. The gift tax rules apply to gifts given by corporations. However, when gift tax is due on corporate gifts, it's not actually the corporation that's liable for paying the tax.

Individuals Only
According to the Internal Revenue Service, the gift tax applies only to "individuals" -- that is, people. Corporations do not pay gift tax, nor do other entities such as partnerships, estates or trusts. However, if a corporation does give a gift that qualifies for the tax, the tax still has to be paid by someone.

Paying the Tax
When a corporation gives a taxable gift, the stockholders of that corporation are liable for reporting and paying gift tax; each must file a gift tax return for his "share" of the gift. Tax law is essentially silent about how to divide up the responsibility, since corporations generally don't go around giving taxable gifts. Small-business corporations with just a handful of shareholders may be able to assess the responsibility fairly easily.

Related Reading: How Does a US Corporation Utilize Foreign Tax Credits?

Gifts Subject to Tax
Gift tax is assessed based on the total value of the gifts from a particular giver to a particular recipient. As of 2012, a giver could provide up to $13,000 worth of gifts to a recipient before the tax would apply. With such a limit, a business shouldn't have to worry about gift taxes for token gifts. Gifts to tax-exempt organizations, including charities, are not taxable

Bytemaster, once again I commend you guys on trying to find creative interpretations of the law, however you are not "accepting gifts"... you are taking "donations" in one statement, "earning" in another statement, "competing" in another statement, and then referring to the item in question as "shares" or an "investment"... that's the legal problem!

you can't just decide what type of taxes or product you want something to be and only follow that imaginary line, you have to follow what you're actually doing... either you're selling a product to customers, you're taking donations (which are not gifts), or you are having an IPO and selling off shares of invictus or a sub-company owned by invictus... creative interpretation does not allow you to bend rules, especially when during this "donation" phase you needed to comply with the laws of 50 american states and whatever international laws apply for each individual country where you accepted them from..

thats the issue...

everyone company in this country would consider every transaction a "donation" if they could skirt the IRS and call it a gift from their "patron"... so the problem remains as to how this will be classified in the eyes of the IRS... as of now its all a for-profit business model which will have substantial taxes due unless like you said, you spend every penny... this does not mean you WON'T have to pay taxes, it will be greatly reduced, but there will be significant taxes for payroll, healthcare, along with all the other normal state local federal taxes every business must pay... then it will come down to if employees are considered independent contractors or not, and there are very strict guidelines to determine if someone is or is not, and companies can pay a substantial fine for trying to skirt that law as well...

you see my issue is the fact you guys are "looking into non-profit" status means you are NOT getting the amount of legal advice and thought before all this is done, you're only doing it after you realize there very well are going to be issues, and that is what scares me with my "donations"... because THOSE donations could become property seized and distributed as a reward so they will not go for the true intention of developing this community as promised...