Wednesday, November 26, 2008
In a November 24, 2008 article, the Chronicle of Philanthropy picked up on the simmering controversy concerning the Mozilla Foundation and whether search related royalties from Google should be treated as nontaxable royalties rather than unrelated business income. Pointing to an earlier post by Associate Editor John Colombo, the Philanthropy stated:
John D. Colombo, writing on the Nonprofit Law Prof Blog, says the case is not the first where questions about whether payments are “royalties” or unrelated business income have arisen, citing previous tussles with the Sierra Club and AARP. “My guess is that the IRS is going to classify this income as UBI (unrelated business income), not royalties, but there’s certainly enough doubt about the definition of royalties that I wouldn’t bet much on it,” he writes.
Nice going John.