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View Diary: Rolling Jubilee Poised to Retire $9,000,000 in Medical Debt! (67 comments)

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  •  Sorry to say, but no -- this is a really dumb idea (0+ / 0-)

    every "dollar of debt bought for a nickel" and then cancelled is:

    a) most likely uncollectible in the first place. That's why it's in the five-cent bucket to begin with. Why waste money on buying it when you could better spend the money educating people in the simple means at hand of not paying it at all?

    b) because it is commercial debt being bought, cancelling it creates a tax liability on the "income" the cancellation represents for the recipient under current IRS regulations, which must be paid. Will the Strike Fund be sticking around to pay these tax bills, too?

    c) it violates the rules governing a (501) (c) (4) to buy commercial debt and forgive it except in cases where the recipient is clearly indigent. Strike Fund is not interviewing the recipients of their gifts to see if they are "indigent" or "working middle class" in the view of the IRS. This violation of their charter will bring cancellation of (501) (c) (4) status, and with cancellation will come a humongous tax bill for Strike Fund. A completely avoidable disaster.

    This project needs some serious tax experts to look at it and guide it, not a bunch of inspired amateurs tossing donated dollars in all directions like flower maidens tossing rose petals at a wedding.

    This project as currently operating is paying uncollectible debts for no reason and blindly leaving havoc in their wake for years following their parade.

    The IRS will not forgive, nor forget, even if we shut their website down for fun. This is the kind of mess they clean up after in their own good time.

    Expect them.

    Detailed explanation

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