Debt Relief Industry

IRS Still Actively Going After Nonprofit Credit Counseling Agencies

As part of a Freedom of Information Act request by the National Policy Group it was disclosed that a number of credit counseling agencies are still undergoing audits with the Internal Revenue Service to determine if they are cleared to continue services as nonprofit entities.

The FOIA response by the IRS stated that under the Credit Counseling Compliance Project, 275 organizations had been identified to be included.

Of those 15 percent had their nonprofit status revoked, another 16 percent are still undergoing IRS audits, and 19 percent are completed and have had their tax status proposed to be revoked.

So far the audits have consumed about 87,000 man hours of labor just on the IRS side and have resulted in only 8 percent of the nonprofit credit counselors not having their status challenged or revoked. – Source

It appears there are still 115 agencies that are part of the Credit Counseling Compliance Project but have neither received a no action letter nor are in active examination.


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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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