Often, we’ve had the internal discussions at Americans for the Arts about intrinsic problems of the not-for-profit model. These problems seem intractable because our tax code only allows foundation grants and tax-deductible gifts to flow to not-for-profits.
I wanted to share something I just learned about L3C’s.
A low-profit limited liability company (L3C) is a legal form of business entity in the United States that was created to bridge the gap between non-profit and for-profit investing by providing a structure that facilitates investments in socially beneficial, for-profit ventures while simplifying compliance with Internal Revenue Service rules for “Program Related Investments”. It was first introduced in Vermont in February 2008.