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Re: OT: Mechanical questions regarding KIVA.org Posted by Scott Paterson [Email]  (#13)  [Profile/Gallery]
(more from Scott Paterson) on Sun, 17 Aug 2008 18:57:26
In Reply to: OT: Mechanical questions regarding KIVA.org, MI-Roger  [Profile/Gallery]
, Sun, 17 Aug 2008 16:29:47
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>1) I assume if a loan is defaulted, the funds provided can be deducted as a contribution to a charitable organization. Is this correct?
1. This, I think, would be a capital loss, not a charitable donation.
>2) How does an individual treat the small income generated from loans that do not default? The 1040 form lists interest received from individuals, but is this the right classification?
2. There is no small income generated as it is a zero percent loan. There is however, a HUGE AMOUNT OF GOOD KARMA generated and for that, thank god, the IRS does not tax you.
>3) Would this be considered as foreign interest and treated as such on the 1040?
3. See answer #2. I understand that Kiva has and is considering a small interest to lenders, but it is not being well received by the lending community. Who cares about 1%, I mean really. I'd rather not go through the paperwork for 1% and it no longer feels like good karma either. If you want to try your hand at earning a percentage off loaning to people, you can look at prosper.com or eBay's Micropoint.
>4) Do the members receive any income from the loans? It appeared from the website that there is income associated with a successful loan, albeit so small that the lender's motivation is obviously humanitarian in nature and not income directed.
4. Again, no, if you lend $25 to someone, when the loan is fully repaid, you get that $25 back. No more, no less.
Hope that helps, feel free to post any further questions. Saabnet.com has now made a total of 119 loans.
-Scott
http://www.kiva.org/lender/saabnet
_______________________________________ Saabnet.com Webmaster Saabs Owned: 1973 Saab Sonett III (Current) 1983 Saab 900 Turbo 1985 Saab 900 Sedan 1990 Saab 900 1992 Saab 900S 1999 Saab 9-3 Turbo 2005 Saab 9-2X Aero (RIP 95K/Accident-guy ran stop sign) 2005 Saab 9-2X Aero (Current) 2007 Saab 9-3 SportCombi 2010 Saab 9-3X Wagon Winner 1996 Saab Owners Convention Rally Novice Class Winner 1999 Saab Owners Convention Rally (All Classes) Also Founder of two non-profits: Poverty2Prosperity.org RunClubMenloPark.org
, Sun, 17 Aug 2008 16:29:47, Mon, 18 Aug 2008 01:30:32, Sun, 17 Aug 2008 22:17:43, Sun, 17 Aug 2008 18:57:26 <-- Viewing This Message, Mon, 18 Aug 2008 03:44:59, Mon, 18 Aug 2008 05:31:04
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