zlacker

>>modele+(OP)
There is a lot in here but turning a non-profit into a for-profit definitely should be challenged. Otherwise why wouldn't everyone start as a non-profit, develop your IP, and then switch to 'for-profit' mode once you got something that works? You don't pay income taxes and your investors get write offs.

>>silico+z11
I'm not at all clear on what a "not for profit" status even does, tax wise. In any jurisdiction.

They are still able to actually make a profit (and quite often will, because careful balancing of perfect profit and loss is almost impossible and loss is bad), and I thought those profits were still taxed because otherwise that's too obvious as a tax dodge, it's just that profit isn't their main goal?

>>ben_w+u41
Well, you're confused because of your erroneous determination that they're "able to make a profit." They are not. They are able to have positive cash flow but the money can only be reinvested in the nonprofit rather than extracted as profit.

>>emoden+061
OK, so for me "positive cash" and "profit" are synonyms, with "[not] extracted" meaning "[no] dividends".

>>ben_w+J61
Positive cash flow and profit are almost synonyms although there can be subtleties they are not relevant to this discussion.

The parent comment is making a common mistake that non-profits can not make profits, that is false. Non-profits can't distribute their profits to their owners and they lack a profit motive, but they absolutely can and do make a profit.

This site points out common misconceptions about non-profits, and in fact the biggest misconception that it lists at the top is that non-profits can't make a profit:

https://www.councilofnonprofits.org/about-americas-nonprofit...