Monday, May 5, 2014
Why No One In Their Right Mind would CROWDFUND
1) Equity Crowdfunding is a Felony.
2) Donation-based Crowdfunding is for Non-Pofits
It will only get you in trouble unless you are a non-profit. One of my friends is former SEC Comissioner and happens to teach Law at George Washington. The SEC & IRS send their attorneys to him for their continuing Ed Credits. Because they are his students, they tell him what's coming from their agencies.
A for-profit that accepts donations, must pay 50% in taxes to the IRS. This isn't being done. They are just letting that pile up and they are going to start levying bank accounts. They don't have to make any announcements because the laws have been on the books and KNOWN for decades.
KickStarter & IndieGoGo aren't culpable because they state in the agreements that you sign, that you are responsible.... but who reads those things, right?
Next, there is quite a bit of fraud in crowdfunding... people raise money, then never follow through. You only hear about the big wins but for each dollar that makes it for good, there are $42 that go down the tubes and taken out of the economy.
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