Re: [AlpacaTalk] Re: [alpacapolitics] AOBA subsidiary
Hello Stephanie,
There is no more income. It's just that now we have to pay taxes on income
we didn't use to have to pay taxes on. There's actually less income as we
have to pay taxes now on income we received before but didn't pay taxes on.
Example using FAKE income (so don't get into a tizzy re: amounts):
Before we realized we had to pay taxes on income:
FRG income: $100.00
Magazine: $100.00
Auction: $100.00
Gross Income: $300.00
Taxes paid: -0-
Net income after Taxes: $300.00
AFTER we realized we had to pay taxes on income:
FRG income: $100.00
Magazine: $100.00
Auction: $100.00
Gross Income $300.00
Taxes paid: 100.00
Net income after taxes: $200.00
So you see, same income but now taxable so we actually have less income.
Non profits DO make money! Whoever told you that a not for profit can't
"make" a profit? Revenue and expenses never exactly match and I've worked
for many, many non-profits in my career that made money. The key is how
much you make and in what areas before you have to pay taxes. Separating
out the taxable income from the non-taxable income protects you from paying
taxes on the non-taxable income. It's the right, smart thing to do when
you run a not for profit and it's perfectly legal...that why the rules are
there to allow it. Consult a non-profit attorney if you don't believe this
to prove it to yourself.
Libby
Libby Forstner
Magical Farms
Stardust Alpacas
<stardustalpacas@
yahoo.com> To
Sent by: alpacapolitics@
AlpacaTalk@yahoog alpacatalk@yahoogro
roups.com cc
Subject
12/29/2007 07:01 [AlpacaTalk] Re: [alpacapolitics]
PM AOBA subsidiary
Please respond to
AlpacaTalk@yahoog
roups.com
If there was a reason to make a for profit
corporation, then there IS surplus money. If AOBA
chose to donate the money before the end of the year
(such as to the ARF), then they would avoid paying tax
on that surplus money. Instead, they choose to keep
it. Non profits are not-for-profit by definition. Why
is there a profit to hold on to? Are they charging to
much to the members?
If this was not an issue before, then obviously they
now have too much money in the bank to be considered a
non profit, which is why they had to make the change.
Seems to me, that AOBA should consider changing itself
into a non-profit cooperative (like AFCNA), where the
surplus money COULD go back to the members since
apparently the members don't own AOBA. Seems more fair
to the people that gave all that surplus money to AOBA
in the first place.
Stephanie
--- Acres of Love <alpacas@acresoflove
> There seems to be some mis-conception that AOBA has
> suddenly, magically
> begun turning some extraordinary profit, resulting
> in "surplus funds". No
> new "for profit" company was started. A corporate
> entity, Alpaca Livestock
> Company was formed to encompass three existing
> enterprises.
> Magazine, F&RG and the auction at Nationals.
>
> There is no new money. Just your friendly local IRS
> wanting income tax on
> the money generated by Alpacas Mag, F&RG program and
> the auction held at
> Nationals. So, there is no "surplus funds" to "give
> back" to members.
> Matter of fact, there is LESS money now, as IRS now
> gets some. The function
> of the Alpaca Livestock Company is to provide an
> official accounting point
> for the portion of activities and transactions
> within the realm of AOBA
> which the IRS deems taxable.
>
> We are on Dish Network and have seen several (AOBA)
> commercials this month,
> one as recent as 2-3 days ago. We have not seen an
> ILA commercial for some
> time, but we usually see them nearly as often as
> AOBA spots.
>
> Tennessee corporation records are, like many states,
> available on-line.
> Alpaca Livestock Company is "owned" by the Alpaca
> Owners and Breeders
> Association. AOBA members are just that, "members",
> not "owners" of AOBA,
> thus they do not "own" Alpaca Livestock Company,
> either. Wholly owned
> subsidiary companies do not issue stock
> certificates, as there are no
> "shares".
>
> Income tax liability could be avoided by AOBA by
> merely stopping publication
> of Alpacas Magazine, discontinuing the F&RG program,
> cancelling the auctions
> at Nationals and ceasing TV ad purchases. Since we
> can't afford the TV
> spots ourselves, we prefer that AOBA continue the
> aforementioned activities,
> even if some portion of the funds involved are
> subjected to income tax.
>
> Jess
>
> Jess & Cookie Bowers
> Acres of Love Alpaca Ranch
> Acres of Love Alpaca Transport
> 11006 N 92nd East Ave
> Owasso, OK 74055-6531
> (918) 327-3519
> Fax (918) 272-0969
> WWW.Acresoflove.
>
> ----- Original Message -----
> From: "Stardust Alpacas" <stardustalpacas@
> To: <AlpacaTalk@yahoogro
> <alpacapolitics@
> Sent: Saturday, December 29, 2007 1:55 PM
> Subject: [alpacapolitics] AOBA subsidiary
>
>
> >I am not a member of AOBA so this topic does not
> > apply to me directly, but since AOBA affects the
> > entire industry, it does concern me as an alpaca
> > owner.
> >
> > 1. Why did AOBA start a for-profit company instead
> of
> > giving money back to the members in some way, or
> > lowering prices for shows, magazines, or
> memberships?
> >
> >
> > 2. Why couldn't AOBA give the surplus money to the
> > affiliates, the Alpaca Research Foundation, or
> more
> > advertising? Honestly, I haven't seen an AOBA
> > commercial in at least a year.
> >
> > 2. Are all the AOBA members listed as owners of
> the
> > Alpaca Livestock Company business records?
> >
> > 3. Will the Alpaca Livestock Company be issuing
> stock
> > certificates (since it is not owned by just a few
> > people) and giving dividends to its owners?
> >
> > I am sure that there will be more questions once
> these
> > are addressed, but these are some initial concerns
> of
> > mine.
> >
> >
> > Thanks,
> >
> >
> > Stephanie Zeleny
> > Stardust Alpacas
> > Creswell, OR
> > 541-895-0964
> > stardustalpacas.
> > stardustalpacas@
> > stephanie@stardusta
> > As for advertising, I have not seen an AOBA
> commercial
> > in at least a year. I do see "I love alpacas.com"
> > commercials once in a while, but never AOBA
> > commercials.
> >
> >
> >
> > --- libby@alpacafarm.
> > rote:
> >
> >>
> >>
> >>
> >>
> >>
> >> Heather,
> >>
> >> I'm not the one to answer these questions as to
> >> exactly why. Contact the
> >> Marketing Committee members and they should be
> able
> >> to answer you
> >> questions. I'm, of course I'm assuming you
> really
> >> want to understand.
> >>
> >> I do know that it costs lots of money to
> advertise.
> >> The magazine costs
> >> money to publish. It's not done for free. Ads
> >> costs money. It isn't
> >> free to AOBA just because we all want it to be.
> So
> >> it can't be free to us.
> >> Out in the world, this is what things cost. Ads
> on
> >> TV (one of the most
> >> effective methods of advertising) costs big
> money.
> >>
> >> It works the same way as it works at shows....by
> >> charging some more (such
> >> as sponsorships)
> >> makes it possible for those
> >> who can't pay the full cost or don't want to pay
> the
> >> full cost to attend.
> >> It's EXPENSIVE to put on a show. Yes, those who
> pay
> >> a LOT more than it's
> >> worth get "something" for what they are charged
> but
> >> I have no doubt that
> >> they don't "get their money's worth" either.
> >> Instead of using words like
> >> "elitist BS," try to look at it different. Some
> >> people pay $5,000 for a
> >> sponsorship to a show so that others can attend
> for
> >> $50 and what the person
> >> who pays $5,000 gets is (sometimes) preferred
> >> stalling (certainly not worth
> >> $1,000 or so) or a small gift. If the cost was
> >> spread out the same to all,
> >> the cost would be hundreds of dollars each.
> Think
> >> about it. Elitist?
> >> Generous? Depends on your perspective. Why not
> >> help out a show and other
> >> participants by paying a sponsorship? Why not
> >> become a Benefactor and help
> >> others as well as getting all those elitist
> goodies
> >> you crave. Always
> >> surprises me how differently we all look at life.
> >>
> >> I sugget instead of complaining, please find out
> the
> >> facts first. You
> >> might be pleasantly surprised at why it has been
> set
> >> up this way (mostly by
> >> small breeders) all these years. Pretty clever,
>
=== message truncated ===
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posted by Chaddo at 6:10 PM
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