On Aug 30, 4:17 pm, "Paul Thomas, CPA"
wrote:

But lookee here! Since you are a CPA and possibly gullible enough to give
free advice, what is the precedent for a non-profit forgiving a for-profit
its debt without any security or recovery of that debt? Let's say the
amount is about $150,000 and the non-profit in a monopoly situation.

The NFP would be required to issue a 1099-C for the cancellation of the
debt.

The FP entity would have taxable income in most cases.

Then the board would have a fiduciary responsibility to not do business with
that entity in the future.

The board members know they are at risk for their decisions, both
financially and legally, right?

They can be sued for mismanagement, and even charged with criminal activity
if that's the case. That's why you do all you can when it comes to "full
disclosure", in the light of protecting certain details on personnel and the
like.

Y'all need to find a geeky attorney to join the board.

--
Paul A. Thomas, CPA
Athens, Georgia

Are you sure about this, because you have just put your finger on the
button?

Chess Cafe bought the USCF's books and equipment business in 2004, by
making by far the best bid and guaranteeing to pay a minimum of
$250,000 per year.

By mid-2005, they were far behind in their payments and refusing to
pay unless the USCF agreed to re-negotiate.

Finally, the USCF Executive Board agreed to forgive the indebitedness
of $150,000 and signed a new deal under which Chess Cafe guaranteed to
pay only $100,000 per year.

Naturally, the companies that were outbid by Chess Cafe are angry
because they were prepared to pay more than Chess Cafe ultimately paid
under the final renegotiated contract.

This all happened in the year BEFORE I was elected to the USCF
Executive Board.

So, now you are saying that the USCF Board could be sued for mis-
management and even charged with criminal activity.

Is that correct?

Sam Sloan