Bitcoin core non-profit gets approved for tax exemption, perks for donors

Photo: Cointelegraph

501(3)(c) status boosts the project's legitimacy as well as its efficiency in using donations.

A new non-profit aiming to fund Bitcoin development education and research has been approved for special tax status, conferring benefits on donors.

Brink, which launched in the fall, has been approved as a 503(c)(3) organization according to a Feb 10 blog post. The status both exempts Brink from federal taxes and provides some interesting benefits to donors, especially considering their use of Bitcoin. 

Donations to 503(c)(3) organizations in the U.S. have always been an important tax write-off, but considering the long-term confusion over the IRS seemingly asking for Bitcoin users to pay capital gains taxes on any use of Bitcoin as a payment. In its announcement, Brink says that it offers an alternative:

"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."

Headed by Bitcoin core developer John Newberry, Brink runs fellowship and educational programs for new devs. The legal status as a 503(3)(c) non-profit will also open Brink up to new disclosure requirements, which Bitcoin's innate transparency may make simpler. 

However, the BTC address that Brink advertises on its Twitter feed appears to be unused, suggesting that its donations from existing sponsors like the Human Rights Foundation and Square Crypto have been coming through other channels or even fiat. Newberry had not responded to Cointelegraph's request for comment as of publication time. 

The confusion over having to pay capital gains taxes on any payment in Bitcoin had led many to call for a de minimis on the value of those payments before the IRS can come for them. 

Reprinted from Cointelegraph, the copyright all reserved by the original author.