Making the organization as tax efficient as possible ensures that donors’ funds are used to the maximum possible benefit of the mission, and also encourage potential donors who might otherwise not be able to support us. In the U.S., 501(c)(3) status is an I.R.S. designation for charitable organizations which allows taxpayers to donate to the organization and claim a deduction on their federal income tax. Furthermore, donations of long-term appreciated assets like Bitcoin generally don’t incur capital gains tax and can be claimed as an income tax deduction for the full fair-market value.
We therefore knew that gaining 501(c)(3) status would be hugely beneficial to our donors and to advancing our mission. We applied to the I.R.S. for 501(c)(3) status shortly after incorporating the organization in September, and we’re delighted to announce that we received confirmation this week that 501(c)(3) status had been approved. Donations to Brink are therefore tax deductible under I.R.C. section 170, including donations already given.
We applied for 501(c)(3) status under three exempt charitable purposes:
Research - we support, design and publish research related to cryptocurrency. All results of this research and/or development of related technology such as software is made available to the public gratis.
Education - we provide education and materials to our fellows and the general public using a variety of methods, including dissemination or publication of guides, manuals, and blogs, among other possible resources. The materials are made available for free on the website.
Maintenance of Public Infrastructure - we maintain, design, and develop software made available to the general public, gratis and under open source licenses. This software, when run voluntarily by members of the general public, forms a peer-to-peer network. This network is a public payments and communications infrastructure developed and deployed as a benefit for the general public.
Gaining 501(c)(3) status means that our existing donations can be used more effectively and that more potential donors will be in a position to support Brink. Over the coming weeks, we intend to work with Donor-Advised Funds to make it even easier to support Brink.
Special thanks to Adam Jonas at Chaincode Labs for doing some initial research into how to start a 501(c)(3), and to Peter Van Valkenburgh at Coin Center, who gave invaluable advice in the early days. And of course, thanks as ever to our founding sponsors John Pfeffer and Wences Casares, without whom none of this would be possible.
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