This spending/giving/running the Mudcat operation is a seat-of-the pants labor-of-love off-the-books arrangement at this point in time as far as tax implications for all. Incorporation as a non-profit is one sound answer.

It costs some legal fees to become incorporated, but once that is achieved there are donation benefits for all, there is a level of protection for the individual running the operation, and there is accountability. The thousands Max must have poured into this over the years would have been deductible donations for him. If it makes money Max could even conceivably pay himself for his time, or at least pay himself back for his future investment in equipment and software and electricity. As to whether Mudcatters feel it is approriate that Max earn a wage or be paid back is open for discussion, but I see no conflict in this becoming part of the operation. It would be up to Max who got paid, what they were paid, etc., and it would take care of capital improvements. That main thing here is that Max would have to make these arrangements part of a public document (the corporation tax return).

I have a friend who did this with a small targeted organization in order to keep his various enterprises separate because he doesn't do this all of the time, only when opportunity presents itself (sound familiar?) In that case, he's trying to inspire people to preserve their community historic post clocks in urban areas. Incorporation has allowed him to use donated dollars to host a web site with information, to network with various other non-profits and donor groups to target specific projects in their areas; it allows him to write grants offered only to non-profits, and it pays office expenses for printing and such.

Management of Mudcat doesn't leave the hands of the originator under this arrangement, but there is accountability and protection. Our nameless guest has toned down his rhetoric and made lucid points. And though he hints at it, he hasn't gone so far as to suggest this remedy to what he perceives as problems associated with an individual running a setup that some suggest is a private club.

Food for thought.

SRS