Comments on: 501(c): (3) versus (6)

By: Alberto Ruiz

Alberto Ruiz — Mon, 25 Aug 2008 15:52:57 +0000

Hey Stormy, great post!
It’s quite interesting to learn this kind of things which are rarely explained to the broader community. Also, it’s nice to start seeing activity on your blog regarding your new position.
Keep us in the loop, we appreciate it a lot!

By: Stormy

Stormy — Mon, 25 Aug 2008 14:50:52 +0000

If the GNOME Foundation became a 501(c)(6) it would then have to act in the member company’s best interest – which hopefully would be aligned with the GNOME project’s best interest or in the goal of bringing a free desktop to the world – but they wouldn’t necessarily be one and the same. Our charter would be less clear.
It would be a trade organization run by the member companies instead of an organization run by an elected board of directors.
Right now our sponsor companies are part of the community but they don’t run the community. (Granted, the GNOME Foundation doesn’t run the community either but it is the community – it’s members are all GNOME contributors.)

By: Patrick Wagstrom

Patrick Wagstrom — Mon, 25 Aug 2008 14:45:28 +0000

It seems like this begs the question “Why isn’t GNOME a 501c6 instead of a 501c3?” From the list it seems like there are only two real advantages to being a 3 over a 6 — donations are tax deductable and it can apply for grants.
I’m not 100% certain, but looking at jdub’s map of GNOME, it seems like a substantial majority of folks participating in GNOME are outside the US — so the tax deduction elements in the IRS tax code don’t matter much to them. The exception might be if other nations had some sort of reciprocal agreement regarding charities, which doesn’t seem likely.
The other issue is applying for grants. I don’t hear about much of that going on, and I’d assume that once again most of that would be US focused grants. Again, this doesn’t make much sense as most of the grants regarding free software have been coming out of individual governments (not the United States) or from the EU. In fact the biggest source of grants for GNOME seems to come from Google Summer of Code.
Eclipse has shown that you can run a strong community that is a 501c6 structured organization. Individuals still have a lot of say, but so do the companies that contribute to the organization. I’d imagine that GNOME is somewhat structured to give individuals a larger say in the community, but what about the case when so many developers work for a handful of companies (Novell, Red Hat, Canonical, Collabora, etc). It seems like GNOME is in a similar situation where we have lots of members with a common business interest, but we’re sorta strangled from lobbying by the IRS tax code structure.