My crony is now the CEO of an NPO, as well as wants to launch the for-profit commercial operation regulating the same indication as his NPO as well as donating 100% of his increase to the non-profit. the role of the for-profit commercial operation is to supplement monetary confidence to the non-profit as well as relieve faith upon grants, etc.
also, both the NPO as well as the for-profit would be underneath the same primogenitor company. Although the branding of the 2 companies would be underneath opposite names.
so what is the authorised entity for this? can it still be personal as the non-profit? an L3C? or would it still be billed as the for-profit agency. or something wholly different?
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The IRS will smell something then will call for major audit. Tell your friend to do it right, legal and to avoid doing something unaware of. He better consult with an attorney for this where there will be many papers to be filled for the IRS, secretary of the state.
I agree with what above answer said !
There is a way to do this for YOUR friend and it will benefit him greatly and it is legal !