[conspire] Installfest tomorrow; updated LUG HOWTO, esp. on tax/corp. craziness

[Rick Moen]

Hey!  SVLUG's monthly installfest is tomorrow at Google's training
centre in Mountain View near Shoreline Amphitheater.  I'll try to 
be there, and at least hang out for a bit.

I'm just burning some CDs of RHEL5.  It appears, as far as I can tell so
far, that it's like RHEL3/4 in containing no proprietary software
contents, and non-software contents (trademark-controlled image files)
that are lawfully redistributable for non-commercial purposes.  So, it
appears to be for y'all lawful to duplicate.

There are also all sorts of other updates, such as the aforementioned
SimplyMEPIS 6.5 release candidate 1, etc.


Back in 2003, Kendall Clark of the North Texas LUG passed maintenance of
the Linux Documentation Project's "Linux User Group HOWTO" to me.  I did
quite a bit of revamping over the following year, but then neglected it
for three years after that.  So, it's spring cleaning time -- and I've
been tightening it up and updating it, again, catching up on events:

o OSDL and Free Standards Group emborged each other, and metamorphosed
  into the Linux Foundation, which merits your donation dollars and 
  "affiliate" memberships.

o The XFree86 Project, Inc. did a masterful job of rendering itself
  irrelevant.  Vive X.org!  XFree-who?

o SSC, Inc. nuked the much-needed "GLUE" (Groups of Linux Users
  Everywhere) Web site / database without warning or discussion,
  refused people's offers to take over its contents and maintenance,
  and redirected its former URL to the _Linux Journal_ Web site.
  Thanks, SSC!

o Red Hat did another of its goofy site redesigns, blowing away the 
  Red Hat User Group Program, but substituting a self-edited 
  "Army of Friends" directory.  

o _LinuxWorld Magazine_ got nuked including _all copies of back issues_.
  Thanks, IDG!

o  A bunch of new, and good, lists of LUGs emerged, at O'Reilly, 
   LinuxHQ, Wikipedia, and Free Software Foundation.  Yes, indeed 
   -- you guessed it! --FSF's pages list only groups that put "GNU"
   in their names.

Speaking of that, I finally got around to something as a simple debt of
fairness, though I'll probably get snippy mail about it:  At the end 
of brief intro section "What is GNU/Linux?":

   (This HOWTO credits the Free Software Foundation's GNU Project as the
   crucial motive force behind creating and furthering a free aka open
   source integrated system. Thus, it refers to "distributions"
   comprising the GNU operating system atop the Linux kernel as
   "GNU/Linux". Yes, the term is awkward, and FSF's request for credit
   isn't widely honoured; but the justice of FSF's claim is obvious.)

FSF being much astoundingly PR-tarded and having a tendency towards
self-parody, it's difficult to publicly support most of its positions
without seeming like a loon and/or attracting endless argument, but I
didn't think I could, in conscience, ignore that issue, i.e., needed
to correct the impression that our OS emerged parthogenetically from
the forehead of Torvalds.


The middle part of the HOWTO has a lot of OS-boosterism yammer.  I've
tightened the prose and tempered it with _some_ steely realism, but not
yet really taken an axe to that.  Probably, that's my next task.




"7. Legal and political issues; 7.1 Organisational legal issues" got a 
partial re-write.  Because of persistent errors in this area by some USA
LUGs, the section about the United States got this new summary section
-- because this nonsense -=still=- keeps getting maintained by people
who should know better:


   Common Misconceptions Debunked:

   * Incorporation and tax-exempt status are separate issues. You don't
   have to be incorporated to get recognition of tax-exempt status. You
   don't have to be tax-exempt to be incorporated. (Odds are, you honestly
   won't want either. You just probably assume you do.)

   * The "liability shield" one can get from incorporating 
   _doesn't protect volunteers from legal liability_. All it does 
   is prevent any plaintiffs from suing individual shareholders 
   (LUG members, in this case) for tort damages _merely because 
   they own the corporation_, if the corporation itself is alleged 
   to have wronged the plaintiff. Plaintiff's maximum haul in 
   damages from suing the corporation is limited to the corporate 
   net assets, in that one case. However, volunteers are still
   fully liable for any personal involvement they're alleged 
   to have had.

   * Umbrella insurance coverage against tort liability (i.e., 
   against civil litigation) for your volunteers almost certainly 
   costs far too much for your group to afford (think $2,500 each 
   and every year in premium payouts, give or take, to buy $1M in 
   general liability insurance coverage -- which generally would 
   cover only the corporation as a whole and its directors in the 
   strict performance of their defined duties), if you can find it 
   at all.

   * IRS recognition as a tax-exempt group doesn't mean donations to
   your group necessarily becomes tax-deductible: Automatic
   deductibility is reserved to _charities only_, IRS category 501(c)(3),
   which must obey extremely stifling restrictions on group activities
   (e.g., it would then become illegal to host anti-DMCA events or 
   support any other political activity), and must meet exacting 
   paperwork and auditing standards. It's difficult to envision 
   501(c)(3) charity status actually making functional sense for 
   any Linux group -- though one continually hears it recommended 
   by those who imagines being able to tell people their donations 
   will be guaranteed tax deductible must justify any accompanying 
   disadvantages. Most LUGs would more logically file (if at all) 
   for recognition as a "social and recreation club", category 501(c)(7) [1].

   * In any event, unless one wishes to become a registered charity to
   render incoming donations tax-deductible, there is _literally no point_ 
   in applying for IRS recognition of your small, informal Linux group 
   under any of the Internal Revenue Code section 501(c) tax-exempt 
   statuses, because IRS simply doesn't care about groups with annual 
   gross revenues less than $25,000, and doesn't want to hear from them. [2]

   * The Federal Volunteer Protection Act of 1997 [3] does not [4], in 
   fact, shield volunteers of Internal Revenue Code section 501(c)(3) 
   charities from tort lawsuits. At most, it furnishes some legal 
   defences that can be raised during (expensive) civil litigation, with 
   a large number of holes and limitations, and in most states will 
   be denied unless the group also carries large amounts of (very 
   expensive -- see above) liability insurance. Also, unless the 
   volunteer's duties are not very meticulously defined and monitored, 
   and the alleged tort occurs strictly in the scope of those duties, 
   there's no shield at all -- plus the litigated action must not involve a 
   motor vehicle / aircraft / vessel requiring an operator's licence, 
   nor may the volunteer be in violation of any state or Federal law, 
   else again there's no shield at all. (On the bright side, it's 
   completely false, as often alleged, that the volunteer must
   be a member of the group, to be covered: In fact, the Act clearly 
   states that a volunteer may be anyone who performs defined services 
   for a qualifying group and receives no compensation for that labour.)

   As may be apparent from the above, a number of groups have, in the
   past, talked themselves into unjustifiable levels of bureaucratic
   strait-jacketing with no real benefit and serious ongoing
   disadvantages to their groups, because of misconceptions, careless
   errors, and tragically bad advice in the above areas. In general, you
   should be slow to heed the counsel of amateur financial and tax
   advisors. (This HOWTO's maintainer had past experience during his
   first career as a _professional_ finance and tax advisor, but, if you
   need competent advice tailored to your situation, please have a
   consultation with someone currently working in that field.)

   [1] http://www.t-tlaw.com/lr-06.htm
   [2] http://www.guidestar.org/news/features/990_myths.jsp
   [3] http://www.congress.gov/cgi-bin/query/C?c105:./temp/~c105ss2v68
   [4] http://www.runquist.com/article_vol_protect.htm


South Bay Linux people may recall that SVLUG recently emerged from
having had damned near _every one_ of the above-listed errors urged upon
it, leading to much unpleasantness and silly handwringing ("What if
someone electrocutes himself at an installfest?"), before the situation
was corrected.  I'd like, if possible, to help other groups avoid
wandering down any of the same garden paths.

The Linux Documentation project hasn't yet posted the update on its main
site and mirrors -- should happen RSN -- but my local copy can always be
read here: http://linuxmafia.com/lug/  (Note that the LinuxDoc SGML is
always available, and that this is a freely licensed document under
Creative Commons BY-SA 3.0.