Questions for non-profit tax attorney. Makersmiths is a 501(c)(3) non-profit maker space in Leesburg Virginia. We are looking for definitive and defensible answers to the following questions. Some of these questions have multiple parts. When discussing Tax Liability, we would like to know both how it applies to us and to one of our members. Please consider Federal, State, County, and City tax implications. 1. We understand that we can have periodic (4 times, 6 times, or maybe more – we would like to know how often) fundraising activities at which we can sell, for example, branded T-Shirts (like a T-shirt with our logo and a 2024 spring fundraiser message), key chains, and Coffee Mugs without incurring any Sales Tax liability. Is this correct? 1a. Makersmiths has equipment that consumes ink or paper or resin. We charge a fee for these consumables to offset the cost of purchasing these consumables. We also have metal, clay, glazes, thread, leather stain and oils that we charge a fee if the members use these supplies. Is this considered resale of goods and if so should we be collecting state sales tax? 2. If we have a full time company store, can we sell ‘branded’ merchandise – T-shirts, keychains, coffee mugs, or other similar items (for example, a T-shirt with our logo and a “Maker Spaces are Great” message) without having to collect Sales Tax ? 3. If we have a full-time company store, can we sell other un-branded items – end mills (a kind of fancy drill), sandpaper, lumber, steel, clay, and other supplies without having to collect Sales Tax ? What constitutes a 'convenience' item for our members and how would we determine if a particular good was a convenience item or subject to Unrelated Business Income Tax? 4. We understand that a Volunteer is someone who does something in our organization without expectation of compensation. Is this correct ? 5. As soon as that person asks for compensation, they become an Independent Contractor as long as they set the time and place of the service they are providing, set the hours that the services is provided, and set the scope of the work for the service they are providing (and a few other IRS things). Is this correct ? (We provide 1099’s for any who exceed $600 per year.) 6. We understand that if we ask someone to provide a service for which we are offering compensation (either as cash or, for example, a period of free membership, or a free class) with our requirement that they perform certain duties and we select the time and scope of the work, and it is work for which we would normally have to pay, they become a contract employee. Is this correct ? If correct, what tax activities or reporting must be done in this case ? 7. Are there any dollar limitations on items 1 through 6. (For example, $50 requires no tax, but $500 does ? What are the dollar values at which tax activities or reporting is required ? ) 8. We might want to provide some incentivizing compensation to some of our members. We understand that we can ‘award’ something (a free month of membership or a free class) to them without incurring any tax liability. Is this correct ? Would this be considered a quid pro quo exchange? 9. We want to know, if a member ‘asks’ for compensation (free membership or a free class) can we still give this to them without tax liability ? Does this make them a contract employee ? If so, we assume we will need to file a 1099 for them. Are there dollar limitations (other than the $600+ 1099 requirement) ? 10. We believe that we can hold an (annual, semi-annual, or other periodic – what period please) appreciation dinner for our Instructors and do not need to report this other than as an expense on our books. Is this correct ? Are there any other requirements or limitations ? 11. We believe that we could send one of our Instructors to an external class, as long as that class is related to the work they do for us as a volunteer, without incurring any tax or reporting requirements (other than as an expense in our own books) for either us or the Instructor. This to include the cost of the external class, transportation, meals, lodging, and incidentals. Is this correct ? Are there any additional record keeping or reporting requirements? Does the Instructor need to report this on their taxes ? 12. Are there other incentives we could offer to our Members or Instructors without incurring tax and reporting requirements ? What are they ? 13. If we elect to award a complimentary membership (person gets access but does not pay dues - 3 months in duration. We usually give these out to students or hardship cases). do we need to carry these in the liability section of our books? Are there any additional record keeping or reporting requirements? Are there tax implications for us or the member and if so, what ? 13a. Two members who, on a monthly basis, volunteer to load, fire, and unload the ceramic kiln. They are asking for a stipend or reduced membership fees for this service/work. The Board approved a 3-month Complimentary Membership (free membership) for each member. Is this a barter – free membership in exchange for the work? If yes, would a simpler way such as paying them each $65 per month and them continuing to pay their $65 monthly membership dues been better? If this is not a barter, is the value of the free membership considered income that the members would need to report on their tax returns? 14. Our CPA has looked at a complimentary membership we recently awarded that had some duties listed for the member. The CPA advises that this looks like a barter transaction. We think there is some additional tax reporting for barter transactions. Is this correct ? If so, what additional records and reporting do we need to do. 15. We have read some material on de minimus transactions. What kind of limits are there and what kind of records need to be kept. 16. Can we offer an internship (i.e. a summer student who wants to learn and contribute their time assisting one of our Stewards). What additional records and reporting are required and how should we carry this situation on our books ? 17. We have Open Houses to invite people into our facilities for tours to show them what we have and encourage them to become members. We also participate in Town or County events that allow us to have a booth to ‘market’ Makersmiths. Some of our members would like to display and sell their products (items they made at Makersmiths or in their homes/businesses). Can we do this and not jeopardize our non-profit status or incur any state sales tax requirements? 18. Can our Directors be paid for contract work they do for us or does the present an appearance of conflict of interest problem ?