[hackerspaces] Hackerspace legal formation and insurance

[Carlyn Maw]

I've been told by a number of people that we should have D&O insurance.
Anyone have any thoughts on that?

On Sun, May 23, 2010 at 4:40 PM, Nick Farr (hackerspaces.org) <
nick at hackerspaces.org> wrote:

> On Sat, May 22, 2010 at 23:17, Matthew McCabe <matt at mrmccabe.com> wrote:
> > The Austin Hackerspace is looking at options for forming a legal
> > entity and are considering an LLC or DBA.  What legal formation do the
> > US based hackerspaces typically use?
>
> US Hackerspaces typicaly go the Non-Profit Corporate route, or the LLC
> route.  I actually have never heard of a hackerspace going DBA.
>
> The main advantage to being a non-profit is the tax benefit, ability
> to receive grants and offer tax-deductibility for donations as well as
> membership control of the organization.  The main disadvantage is the
> paperwork overhead.
>
> The main advantage to an LLC is simplicity of paperwork.  The downside
> is that those listed as members of the LLC are liable for paying taxes
> on the profits of the hackerspace.
>
> Both an LLC and a Non-Profit corporation offer "corporate shield"
> status, meaning the assets of the directors/members are not generally
> at stake in a claim on the activities of the hackerspace.
>
> > Also, we are looking at buying liability insurance to protect the
> > founders and members of the space.  Any suggestions on what level of
> > coverage we should have?
>
> Get the general (commercial) liability insurance coverage required by
> your lease.  You really don't need insurance until you actually
> acquire a space and most other insurance for small organizations is
> not generally worth the cost.
>
> Nick Farr / http://nickfarr.org / 8B13F204
> Washington, DC, 20013-1208
> Currently in Germany: +49 177 647-8916
> P: +1 (707) 676-FARR
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