[skissane]

> I get that it's not trivial to set one of these up (especially for someone who is already in a funding deficit), but I think it would make donations a more attractive option for people.

Is there any sort of general purpose tax exempt org for funding free/open-source software development? Someone makes a tax-exempt donation to that org, earmarked for a particular project, the org forwards the donation to that project as a grant (minus a deduction for admin costs/etc). Then on-boarding a new project would mean just getting that project approved as a grant recipient with that org, which presumably would be a simpler process than setting up a tax-exempt org from scratch.

[jahewson]

Not really. Tax-exempt status in the US prohibits donated money being earmarked. It also can’t be used to funnel money to arbitrary affiliates - they’d need to satisfy the permissible tax-free mission of the org. Plus those affiliates are going to end up paying the tax themselves. Without a clear picture of where the money is intended to go, it’s unlikely such an org could obtain tax-exempt status in the first place.

Note: tax-exempt status has become harder to obtain in recent years for open source projects.

[skissane]

> Tax-exempt status in the US prohibits donated money being earmarked.

Is that true? According to for example [0], a donation earmarked for a particular individual is not tax-deductible, but a donation earmarked for a particular purpose can be. I think a donation earmarked to an open source project sounds more like the second than the first – they are free to give the money to any developer they wish, so long as that developer is going to use that money to work on the earmarked project.

[0] https://charitylawyerblog.com/2015/07/02/donations-benefitin...

[kelnos]

I'm pretty sure what you've described is essentially a tax-evasion money-laundering scheme, and I'm sure the IRS would frown upon it.