tag:blogger.com,1999:blog-11887973.post8246619722646223734..comments2023-11-02T04:58:34.355-04:00Comments on Libertarian Party of Allen County, Indiana: Another misconception about loans and campaign finance lawsJeannette Jaquishhttp://www.blogger.com/profile/00226385515110623744noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-11887973.post-73097448453804834252007-05-26T16:41:00.000-04:002007-05-26T16:41:00.000-04:00KELTY-GATE!KELTY-GATE!David C Roachhttps://www.blogger.com/profile/03001418779103813547noreply@blogger.comtag:blogger.com,1999:blog-11887973.post-12693161946467209452007-05-26T09:17:00.000-04:002007-05-26T09:17:00.000-04:00Anonymous 9:30Thanks for leaving an example, it ma...Anonymous 9:30<BR/><BR/>Thanks for leaving an example, it makes it easier for me to see what you are asking.<BR/><BR/>In the example you left there are no tax consequences of any kind to the candidate when the loan is paid back. It is a return of principal.<BR/><BR/>I am considering the last step!<BR/><BR/>The return of principal is 100% tax free.<BR/><BR/>Mike SylvesterLP Mike Sylvesterhttps://www.blogger.com/profile/06918776704117318033noreply@blogger.comtag:blogger.com,1999:blog-11887973.post-72248949294432441112007-05-26T00:37:00.000-04:002007-05-26T00:37:00.000-04:00Anonymous,Re: "Please explain to me how the contri...Anonymous,<BR/><BR/>Re: "Please explain to me how the contributions do not become income to the Candidate when he uses them to retire his personal debt. Remember if not for the contributions, he would likely have to use POST tax dollars like salary ect to pay off the personal loan."<BR/><BR/>Repaying the loan to the candidate using other's contributions is exactly that - reducing the debt of the campaign to the candidate (principal in - principal out). I believe the contractual terms of the repayment to the candidate would be stated explicitly at the time the candidate made the loan (e.g., campaign will repay x at y interest rate). As Mike so eloquently stated in his example, the principal payment (x) repaid to the candidate would not be income but debt reduction (reducing the funds the candidate initially loaned to the campaign). Any interest paid (y) WOULD be considered income in the tax year the interest is repaid (and therefore subject to income tax). Of course, this wouldn't be declared on the candidate's personal tax return until the following year. <BR/><BR/>The candidate's repayment of his/her personal loan to the party granting the funds initially is a separate matter (with it's own contractual obligations). <BR/><BR/>This is probably why the election board wants to see any and all of these contracts to determine the nature of the lending relationship.<BR/><BR/>I'm no CPA, but this is basic accounting.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11887973.post-73527478564604536512007-05-25T22:30:00.000-04:002007-05-25T22:30:00.000-04:00Mike,I agree with 100% of your example, but what a...Mike,<BR/><BR/>I agree with 100% of your example, but what are your thoughts on the following example.<BR/><BR/>Candidate A gets a PERSONAL LOAN for 100,000 which according to the candidate can be used for anything he wants. (We all agree the 100K is NOT income to Candidate A)<BR/><BR/>Candidate A then contributes the 100K to his campaign in the form of a loan. No deduction for contribution and no income regognized.<BR/><BR/>Candidate A then uses other campaign contributions to retire his Personal Loan (which according to candidate was a personal loan that could be used for anything)<BR/><BR/>Please explain to me how the contributions do not become income to the Candidate when he uses them to retire his personal debt. Remember if not for the contributions, he would likely have to use POST tax dollars like salary ect to pay off the personal loan.<BR/><BR/>Its this last step that you are not considering. And, with all due respect to your new CPA status, you might be wrong on this one. Maybe not, but you might be.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11887973.post-12437771587341479482007-05-25T22:22:00.000-04:002007-05-25T22:22:00.000-04:00Mike, I agree with your example HOWEVER, you are l...Mike, I agree with your example HOWEVER, you are leaving out an important twist. It will take too long to explain in words, but I will give you a call.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-11887973.post-22533773433420579552007-05-25T21:56:00.000-04:002007-05-25T21:56:00.000-04:00"I used to read Taking Down Words; however, I stop..."I used to read Taking Down Words; however, I stopped a few months ago because she reminds me of Sean Hannity; except she is a Democrat. I cannot abide people who feel that their Party is always right and that other Parties are evil."<BR/><BR/>Mike, that's why I rarely go back there anymore. I started reading and posting there on the recommendation of Tracey Warner, when he shut down his blog. He thought I might enjoy the banter, and I did for a while, but she's become very partisan. And her participants/posters are pretty rabid.... <BR/><BR/>As for the accounting portion of your post, you explained that very well!Tim Zankhttps://www.blogger.com/profile/14619436377992741061noreply@blogger.com