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View Diary: Rolling Jubilee Hits $8,000,000 in Medical Debt to be Retired Uncollected. MORE UPDATES! (279 comments)

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  •  jpm - "it's the assertion" (0+ / 0-)

    First, I think this is a great idea and fully support its goals. However, I think there are some gray areas in the tax law regarding the purchase of these liabilities and their forgiveness. While I can certainly see the tax case for treating these as gifts, I can also see the IRS' case for why these should be treated like a routine forgiveness of debt. with the result that the forgiven debt balances would all become phantom income to the very people who are being helped.

    I think it would be in the interest of all parties if the best of the tax lawyers who are helping would ask the IRS for guidance and a letter that could demonstrate to all the potential donors, as well as the beneficiaries, that the IRS had agreed these were gifts and no adverse tax consequences could arise if your debt was purchased and then cancelled.

    "let's talk about that"

    by VClib on Fri Nov 23, 2012 at 03:59:21 PM PST

    [ Parent ]

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