Is there any reason I should say no to being a “TN charter incorporator"

[lawneedy]

Hello, I am in GA. USA

Is there any reason I should say no to being a “TN charter incorporator”

A person from the Department of Energy likes my inventions. The equipment is to be use in developing areas. He took a grant writing course and is now setting up a NPO. He ask me and his Score counselor, who also likes my inventions, to be “TN charter incorporators”. and on the board of directors. The Score counselor has agreed.
I plan to set up a LLC to manufacture the equipment for profit, but I would also like a piece of the NPO.
Could I be liable for anything? have my hands tied? or is there any reason I should say no to being a “TN charter incorporator”

 

[OHRoadwarrior]

There appears to be a conflict of interest developing. You cannot be active in a 501(C)3 organization, that buys or financially advances your business.

Exemption Requirements - Section 501(c)(3) Organizations

To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization, i.e., it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.

Organizations described in section 501(c)(3) are commonly referred to as charitable organizations. Organizations described in section 501(c)(3), other than testing for public safety organizations, are eligible to receive tax-deductible contributions in accordance with Code section 170.

The organization must not be organized or operated for the benefit of private interests, and no part of a section 501(c)(3) organization's net earnings may inure to the benefit of any private shareholder or individual. If the organization engages in an excess benefit transaction with a person having substantial influence over the organization, an excise tax may be imposed on the person and any organization managers agreeing to the transaction.

http://www.irs.gov/Charities-&-Non-Profits/Charitable-Organizations/Exemption-Requirements---Section-501%28c%29%283%29-Organizations

 

[Mass_Shyster]

Could I be liable for anything?

Sure. There's lots of liability for manufacturers.

If someone gets injured because your widget is defective, or even if they claim your widget is defective, or even if there was nothing wrong with your widget but they were near your widget when they got injured, you'll find yourself (along with your LLC) the subject of a lawsuit.

If YOU (personally) designed the widget, the LLC will not shield you from liability based on negligent design.

If YOU (personally) manufactured or assembled the widget, the LLC will not shield you from liability based on negligent manufacture.