We all work together to make sure everyone has enough.

The 501(d) business advantage.

IRC Section 501(d) - Apostolic Associations

​The 501(d) status provides tax exemptions for religious and apostolic communities that share a common treasury. The IRS has failed to define religious/apostolic and thus the terms can be construed to mean any strongly held spiritual or secular belief. The business that the community decides to operate is not taxable as long as all the proceeds are deposited into the designated common treasury and distributed. This includes all income whether produced through the community’s revenue source or by the individual. The community’s business can have either a not for profit or a for profit purpose. The 501(d) exemption does not have any restrictions on political activity, unlike the 501(c)(3). In addition donations made to the community are not tax exempt.

1. ​Members are not employees.
2. Workmanʻs Compensation, Social Security and income tax are not paid.
3. Social Security credits are not accrued unless a member elects to pay Social Security tax.
4. Donations are not tax-deductible.
5. Limited outside income is allowed but is double taxed: to the member and to the community.
6. Community must operate at least one business.

Advantages of a 501(d):

• Labor provided by members of 501(d).
• No employees, no payroll, no payroll taxes and no income taxes.
• Workers are compensated with in-kind goods and services bought in
• bulk quantities.
• Members produce a high percentage of their own food, reducing the
• cost of feeding workers to manufacturers level, about one-sixth of retail prices.
• Eliminates the need for government welfare or charity assistance for members.
• Motivated, responsible and dedicated workers.
• Clients and customers give preference to a worker-owned business.​

East Wind Nutbutters Warehouse

Examples of Successful 501(d) Businesses

East Wind Nutbutters          
​Southern Exposure Seed Exchange 
Commonwealth Seed Growers        
Twin Oaks Hammocks and         
Twin Oaks Tofu               

Since 1980
Since 1999
Since 2008             
Since 1967        
Since 1991    

Supports 65 people.
Supports 32 people.
Supports 15 people.
Together support 105
people.

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