For decades now, the conventional wisdom has been practically knee-jerk: if you want to do your own thing in the arts, the first step is to start a 501(c)(3) corporation. I’m not sure this was ever good advice, but I’m positive it’s lousy today.
Don’t get me wrong: the 501(c)(3) model is a great choice if there are visions of marble columns dancing in your head. That’s because the rules and regulations on tax-exempt organizations are predicated on the archetype of a perpetual, quasi-public institution. Like all corporations, 501(c)(3)s by default are immortal; they are designed and expected to outlive the participation of their founders and are difficult to shutdown. Moreover, federal and state-level charity regulations are complex and onerous but generally pretty effective at preventing (or at least mitigating) abuses of the public trust. Read the rest of this entry »