Eliminating Credit Card Debt Advice

The Internal Revenue Service is contacting 740 tax-exempt credit counseling agencies as it expands efforts to ensure such agencies deserve their tax-exempt status. It already has revoked or plans to revoke the tax-exempt status of 41 agencies, an IRS official said today. It continues to look at an additional 21 agencies.

IRS Commissioner Mark Everson, speaking in a telephone press conference, said the agencies already investigated were “not operating for the public good and they do not deserve tax-exempt status.”

Nick Jacobs, spokesman for the National Foundation of Credit Counseling, an industry trade group, said none of his association’s members were on the IRS list of 41. “We welcome the scrutiny,” he said of the IRS’ investigation. “We welcome steps that help ensure that consumers are getting the best possible counseling.”

The decision to query all 740 tax-exempt agencies about their operations is “unprecedented action for the IRS. We will continue to do more,” Everson said.

The agencies scrutinized already offered what Everson termed ill-advised plans to consumers that resulted in those consumers falling farther into debt or bankruptcy.

# posted by Sponduliqs @ 12:18 PM