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.Org in 2019: $67.5 million to ISOC, $18.3 million to Afilias

Non-profit that runs .org publishes tax return.

Logo for .org domain, featuring a blue circle with white letters spelling ORG

Public Interest Registry (PIR), the non-profit organization that runs the .org top level domain, has published its 2019 tax return (pdf).

There are two big numbers on the return.

First, the Form 990 shows that PIR contributed $67.5 million into Internet Society’s (ISOC) coffers for the year. ISOC is PIR’s sole member and the beneficiary of .org’s profits. ISOC entered into an agreement last year to sell the .org registry to a private equity company for $1.135 billion, only to terminate the deal after ICANN didn’t give its blessing. ISOC was effectively trading in the cash PIR throws off each year for a lump sum that wouldn’t depend on the future of the domain name market.

Second, PIR paid Afilias $18.3 million to act as the technical registry service provider for .org. This is similar to the amount PIR paid Afilias in 2018 ($18.1 million). PIR paid significantly more to Afilias in previous years before putting the contract out for bid. In 2017, Afilias made a whopping $37.8 million from the contract.

Top level domain name company Donuts is acquiring Afilias.

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  1. John says

    New in 2019 – PIR spent $1,250,000 in lobbying activities – almost certainly related to the major issues of ICANN removing all price caps for .org domain registrations and the proposed sale of the registry to private equity firm lead by the former CEO of ICANN.

    Interesting PIR said “while PIR has engaged in some limited government affairs work in 2019, none of it meets the definition of lobbying under IRC 56.4911-2.” Not sure what this means…..

    Bigger question – did the Internet Society Board of Directors approve of this lobbying spend – to defend its proposed sale to Ethos Capital and Jon Nevett’s old boss – while many of ISOC members were against the sale?

    • Andrew Allemann says

      John,

      I had to look back at the tax form to see what you were talking about. I double checked the Schedule C and verified that PIR *did not* spend any money on lobbying in 2019. The number I think you’re referring to is a threshold amount at which a non-profit is allowed to spend on lobbying without running into problems with the IRS.

      You’ll see on line 1F that non-profits enter a number here based on their revenue. In this case, since PIR generated more than $17M in revenue, they are allowed to spend up to $1M in lobbying. Then there’s a separate classification for “grassroots lobbying” that’s equal to 25% of this.

      So PIR is allowed to spend a total of $1.25M on lobbying without potentially losing its non-profit status. But it spent $0, as recorded in line 1C. You’ll also see $0 on line 11d of the main return Part IX.

      There’s more about this here:

      https://www.irs.gov/charities-non-profits/measuring-lobbying-substantial-part-test

      I’m not a tax accountant, but I am working on some of my business tax stuff tonight…and this was a welcome diversion from Quickbooks.

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