Whoa, whoa - wait a sec. I certainly hope that the Burning Man Project chooses to not be about profit, and that they will be a fundamentally good charity that they allocate their donations in a way to maximize impact. (Whatever that really means given how nebulous the mission seems in practice) I kinda think that they will honestly do at least a fair job.Eric wrote:Lemur is correct - it's currently a privately held company that has the gall to pay the people who work there. Once they transition, they will still be paying the people that work there, but it won't be about profit, it will be about 'spreading the ideals of Burning Man into the world' or something. Not that it's currently about profit, but having a non-profit run it removes that argument from play.
However, being a non-profit simply means that an organization lacks shareholders and does not pay dividends. It does not mean that the organization cannot find ways to enrich individuals.
Being a 501(c)3 non-profit means that the organization has convinced the IRS that it is in some sense a charity. This means that it does not have to pay corporate taxes on any profit, and more importantly it opens the door to institutional donations. It also results in a bit more transparency.
But just because an organization has 501c3 status does not mean that it isn't heavily involved in making people rich. The Sugar Bowl - one of the four biggest and most profitable college football games in the US - is (or was) a 501c3 non-profit. They were caught making campaign contributions which is a no-no for a 501c3, but I don't think anything came of that. You can work on getting massive ad revenues and that is just fine. You can pay your directors and officers salaries that are competitive with the CEO pay of a Fortune 500 company.
Basically, the corporate form of an organization, be it an LLC or non-profit, may in practice have little to do with how much money people are making off of it. One should really look into the details of an organization and form your own judgement.
In fact, for small organizations that are not seeking institutional donations, converting from an LLC to a 501c3 may cost considerably more money than the tax savings that are generated.
