ACTION

Everyone who pays any attention to the news knows the name Solyndra. It has become synonymous with the overall failed green energy program administered by the Obama team. Politicos know there are many other companies that have received loan guarantees for various green energy projects that have since become a source of ridicule for the White House. Some might even be able to name a few. There is the now-bankrupt company that made batteries for electric cars: Ener1. The plug-in electric sports car company, Fisker, that made its cars in Finland and has troubles too numerous to cite. And, of course, we know about the Chevy Volt—that our taxpayer dollars bailed out only to have demand so low that Chevrolet had to pull the plug on the production line and lay off workers for five weeks earlier this year. But few know the full story.

Connecting the dots will make your head hurt. There are various programs and special tax breaks and different kinds of companies that received green energy loans: solar, wind, and geothermal; and car companies, battery manufacturers, and biofuel producers. While the projects differ, they have several startling similarities. The vast majority of the green energy loan guarantees were given to companies that could not obtain enough financial backing from private investors. Their “junk” or “speculative” grade kept people from putting their own money into them —yet your money and mine was given to them, and we had no say in the matter. Of the 27 loans issued through the 1705 Loan Guarantee Program to 21 firms, virtually all of them have “connections” to either President Obama or other high-ranking Democrats—or both! The loans were made to fill a market created not by free-market demand, but by government mandates. And, all of the “special seven” got fast-tracked approvals through the Department of Interior with little scrutiny over environmental damages that would have taken any other energy company months, if not years, to get, and EPA regulations were applied selectively.

Many of the companies that received the funds had involvement with large donors and/or bundlers for the Obama campaign, and there is an amazing revolving door through which the players pass many times. They worked, for example, for Senator Harry Reid. Then they are on the staff of an investment firm that invested in one, or more, of the companies. Next you find he or she is on some White House commission—or worse, became part of the Obama Department of Energy team. Some 460 companies applied for DOE loans, but only 27 projects, 21 companies, got the funds. And 85% of these have been found to have “connections.” The remaining 15% may well have connections too, albeit more guarded or hidden.

These are not wild assertions. I have the data to back them up.

Following the publication of my column a couple of weeks ago on crony capitalism, I was connected with Christine Lakatos. She’s a private citizen and a single mom with a nose for research. Beginning in 2009, she was hired to work on investigative projects, following the green energy money. But when those projects were completed, she didn’t stop digging. She kept finding more and more. With no outlet for her work, she started a blog where she “brain dumps” her findings—which for a total unknown has received an impressive number of readers. For anyone but the most stalwart, her Green Corruption Blog is like getting a drink of water from a fire hydrant.

On Sunday, some of Lakatos’ research was presented in my weekly column. The response prompted us to begin a collaboration.

For each of the next 17 weeks, we will expose one green-energy, crony-corruption story after another (though my travel schedule may require me to skip a week here and there). It will be a “book” released chapter-by-chapter. If you like what you find, we hope you’ll let us know and come back the following week for the next installment.

Some single stories of what we’ll expose are “out there”—though surely not covered by the mainstream media and not all in one place or all connected as we’re doing.  If you made a study of the green-energy, crony-corruption story your passion, you likely found out a lot of what we’ll share. If you read the report from the House Oversight and Government Reform Committee (HOGRC) on the Obama Administration’s green energy gamble word-for-word, or watched the incriminating hearings, you’ll already know some of what we’ll present. Or, if you’ve read the chapter in Peter Schweizer’s book Throw Them All Out that addresses alternative energy and “how the game of funneling taxpayer money to friends has exploded to astonishing levels in recent years,” you have a good idea of the big picture. If you have made this your passion, have studied the report, and have coordinated with Schweizer, as Lakatos has, you are encouraged to help make these reports as complete as possible. Together, we’ll connect the dots and present it here in bite-sized pieces.

Each of the energy projects we will profile in the “special seven” section were recipients of billions of taxpayer dollars through the 1705 Loan Guarantee Program (LGP) and many will be receiving millions more through the 1603 Grant Program. The 1705 LGP is an expansion of the 1703 program that was approved in 2005 under President Bush—increasing the expenditures from $17.9 billion in 2007 to $37.2 billion in 2010. The 2009 American Recovery and Reinvestment Act significantly expanded the DOE’s authority, under Energy Secretary Steven Chu, through the newly created 1705 LGP. (Under the Recovery Act, $86 billion—approximately 10% of the stimulus package—was earmarked for green energy projects.) The LGP means that companies get risk-free money. If the company succeeds, the low-interest loan gets paid back. If they fail—as many have—we, the taxpayers, lose. In contrast, the 1603 Grant Program—implemented as part the Obama stimulus––is administered by the Treasury Department, with the goal of reimbursing eligible applicants for a portion of the costs of installing specified energy property used in a trade or business or for the production of income. Basically 1603 gives billions in favored businesses tax-free cash gifts that do not have to be paid back.

While we can prove that cronyism has run amok within the majority of 1705 LGP, we'll stay focused on the Special Seven. Here, in Part 1, we present a complete overview of the connecting dots on one project: SolarReserve, LLC. With this introduction made, we’ll likely address several companies, with a common denominator, in subsequent releases.

In Sunday’s column, the following thumbnail was presented: “SolarReserve’s Crescent Dunes project is a solar thermal power tower plant utilizing the advanced molten salt power tower technology with integrated storage located in Tonopah, NV. The company's Fitch rating is BB, yet in September 2011, it was the recipient of $737 million in DOE loan guarantees. Obama’s law school buddy and 2008 Obama campaign bundler, Michael Froman, was managing director of alternative investments at Citigroup—which became a major investor in SolarReserve. Froman currently serves on the White House staff. Additionally, other high profile Democrats are involved with SolarReserve.”

But there is more.

More about Michael Froman. Peter Schweizer reports that “When Obama ran for president, Froman helped raise large sums of money on Wall Street” for the 2008 campaign. The HOGRC report (page 47) confirms Peter’s findings and adds that Froman was a $200,000 bundler: “Michael Froman currently serves as the Deputy Assistant to the President and Deputy National Security Advisor for International Economic Affairs. He was a friend of President Obama’s from law school, and supported his political career by bundling over $200,000 for his 2008 presidential candidacy. Prior to his arrival at the White House, Froman was the Managing Director of Alternative Investments at Citigroup, where he managed infrastructure and sustainable development investments. Citigroup became a major investor in SolarReserve, which ultimately received a $737 million loan guarantee in September 2011.”

The Citigroup connection is tighter. Richard Parsons was Chairman for Citigroup from 2009 until he announced stepping down in March 2012. Citigroup was a top Obama donor in 2008. Parsons served on the Obama Transition Team and on the Economic Advisory Board. In 2011, Parsons was appointed to the President’s Council on Jobs and Competiveness.

Next, David Sandalow—who is currently “the Assistant Secretary for Policy and International Affairs at DOE, where he acts as Secretary’s Chu’s principal adviser on energy policy, as well as coordinating DOE’s foreign policy involvement.” (HOGRC report page 49) “Sandalow’s ties to the White House date back to the Clinton Administration, during which he worked with President Clinton on environmental issues. After having gained this experience, Sandalow became the influential Chair of the Energy & Climate Working Group of the Clinton Global Initiative. He went on to advise President Obama’s presidential campaign in 2008. Prior to joining the Obama Administration, Sandalow was a senior advisor to Good Energies, Inc., an energy-focused venture capital firm. Good Energies is an investor in SolarReserve.”

Other SolarReserve connections to the Democratic Party include:

Ronald Pelosi—Former Speaker of the House Nancy Pelosi’s brother-in-law, Ronald Pelosi, holds a leadership position with Pacific Corporate Group Asset Management—which is an investor in SolarReserve. Additionally, his colleague, Jasandra Nyker, has served as a member of SolarReserve’s board of directors.

George Kaiser—Argonaut Private Equity is an investor in SolarReserve. Argonaut Private Equity is owned by major Democratic fundraiser and a 2008 Top Obama bundler George Kaiser, who also invested in Solyndra. Kaiser made multiple visits to the White House in the months before the company was granted a $535 million loan from the government. The Managing Director for Argonaut Private Equity, Steve Mitchell, serves on SolarReserve's Board of Directors.

Tony Podesta—OpenSecrets.org shows that SolarReserve paid hundreds of thousands of dollars in lobbying fees to the Podesta Group. Tony Podesta is the principal at the Podesta Group—which he started with his brother John. John Podesta ran Barack Obama’s presidential transition team and is the Director of the Center for American Progress—which is “reportedly highly influential in helping to craft White House Policy.” Both Tony Podesta and his wife Heather (a Washington power couple) are frequent White House visitors that share high ranks in "lobbying power," and Democrat bundling as well.

Lee Bailey—SolarReserve’s Chairman of the Board is Lee Bailey, a Managing Director with U.S. Renewables Group, who holds a significant financial stake in SolarReserve. Bailey has donated $21,850 since 2008 to Democratic candidates, including President Obama, Senate Majority Leader Harry Reid, California Sen. Barbara Boxer and then-presidential candidate Hillary Clinton.

James McDermott—SolarReserve board member James McDermott is also a Managing Director with U.S. Renewables Group. He contributed $61,500 to various Democratic campaigns since 2008, including $30,800 to Obama’s presidential election campaign. U.S Renewable Energy Group has ties with Senator Harry Reid.

If there were only one connect-the-dots story, it would be easy to dismiss it as coincidence. But here, with just one company, you can see the dots connect, and connect, and connect. As you will continue to see, they keep on connecting. In this case, connect-the-dots is no innocent childhood game. It is a high-stakes gamble and only those with connections get to play. Obama and his Democratic friends are the winners. We, the taxpayers, the losers. We lose the financial investment of our tax dollars and our electricity rates go up—all to support the discredited ruse of man-made climate change.

First published at Townhall.com: Obama’s Green-Energy, Crony-Corruption

By Marita Noon (Jun 29, 2012) –– also pick up by: 

• George Jarkesy Radio Show
• Conservative Action Alerts
• The Strident Conservative
• EPA Abuse 
• OurMoney.net

Marita Noon, executive director of Energy Makes America Great Inc., is a voice for energy focusing on the intersection of energy, news, politics and environmentalism. Follow Marita at @energyrabbit

Christine Lakatos is a mother of two terrific daughters, an ACE Certified Fitness Trainer, author, and more –– turned ferocious Green Corruption researcher and blogger. Follow Christine at @calfit32

Our first stop will be "The Special7" that snagged billions in DOE loans that were "junk" rated, millions in tax-free energy grants as well as fast-tracked DOI public land approval with little scrutiny over environmental damage. And....you guessed it....ALL have "meaningful" connections (bundlers, donors, supporters) to President Obama, Senator Harry Ried, and other high-profile Democrats. Some even gained White House staff and DOE Advisor positions. 

While this column uncovered #1) SolarReserve, Marita reported on the entire list of seven in her  "Eco Scare Scams Raise Obama Campaign Cash" Townhall.com piece last Sunday, June 24, 2012.

Here are a summary of the others, but we will expand on each in the following weeks.

Three more Harry Reid ties:

#2) Nevada Geothermal Power (NGP) holds leasehold interests in six geothermal projects located in the Western United States. They hold a BB+ rating and received a $78.8 million loan, guaranteed by the DOE, in September of 2011. Executives from NGP contributed heavily in 2008 to Harry Reid’s campaign. 

#3) Ormat Nevada is a wholly-owned subsidiary of Ormat Technologies Inc., whose website touts “green energy you can rely on.” They have an S&P rating of BB and received $350 million in partial loan guarantees. Ormat’s lobbyist Kai Anderson and Director of Policy and Business Development Paul Thomsen were both former senate aides to Harry Reid and donors to his campaign.

#4)  BrightSource Energy has a three-unit power system project known as “Ivanpah,” located near the California/Nevada border, south of Las Vegas, that uses a proprietary power-tower solar thermal system. Ivanpah I and III have a BB+ rating while Ivanpah II is BB. On April 11, 2011, the DOE announced the finalization of $1.6 billion in loan guarantees for BrightSource’s Ivanpah project. The apparent “payoffs” to Democrats are myriad—having donated at least $21,600 to Democrats since 2008 (and zero dollars to Republicans). According to a Washington Free Beacon report, Senator Harry “Reid received almost $4,000 from Brightsource executives in the 2010 cycle, including $2,400 from CEO John Woolard, who hosted a fundraiser for the majority leader. Woolard is also a Barack Obama donor and has visited the White House 10 times since Obama took office.” Additionally, Sanjay Wagle (a significant 2008 Obama campaign supporter and contributor), a principal at Vantage Point Partners (the major stakeholder in BrightSource) was an advisor at the DOE at the time the loan was approved. And, John Bryson, BrightSource CEO, became Obama’s Secretary of Commerce (although he resigned his post late Wednesday) and has ties to an organization that helped craft the stimulus package. 

And more...

#5) Abengoa has two solar projects: Solana and Mojave Solar. Solana’s Fitch rating is BB+. Just before Christmas, 2010, the company received $1.45 billion from the DOE for a solar thermal plant, to use parabolic trough technology, in Gila Bend, AZ. Mojave Solar’s rating was BB. Yet the company received $1.2 billion in September 2011 for its solar assembly collection project in San Bernardino County, CA. Abengoa has connections to California’s Democratic Senator Dianne Feinstein.

• "The Special7"
• Department of Energy "Junk Loans" and Cronyism List
• While Peter Schweizer's book divulged that ten members Obama's 2008 Finance Committee­, and revealed at least twenty-five 2008 Obama bundlers, large donors, and supporters that were "privy" to large amounts of green loans, grants, and special tax breaks, I found more...
• The RAT in the Stimulus and the “Green Stimulus Authors” that Have Benefited Greatly
• Obama's Green Team, DOE Officials, and DOE Advisors –– Stacked with Left-Wing Radicals, Al Gore Acolytes, and Silicon Valley Liaisons –– are Heavily Implicated in this “Green-Energy Scheme," and many have raked in big "green bucks." Also, a few White House staff that have ties to government green-energy money. 
• At Least Five Members of Obama's Job Council Got DOE Cash –– A Council that is  Stacked With Democratic Donors, many of which came from President Obama's appointed 2009 Economic Advisory Board. 
• Obama-Connected Cleantech (VC) Portfolios that Snagged Billions of Government Funds for Multiple Green Companies and Green Projects 
• Wall Street, Big Oil, Big Energy, and Big Venture Capitalists are Players Cashing in on "Green" Too 
• Failed Obama-backed Green Energy Companies –– the bankrupt and troubled "green projects and companies" list, of which I have tracked close to thirty (and more on the State level), yet it continues to grow weekly.

I know that other disgraces have plagued the Obama administration and taken center stage lately like Fast & Furious, ObamaCare, White House National Security Leaks, and more, however, with only 17 weeks until the 2012 elections, we will attempt to expose President Obama's "clean-energy dirt"  –– Green-Energy, Crony-Corruption Story –– of which I personally believe is one of the biggest scandals (and most expensive) of the Obama presidency!

BEST KEPT SECRET OF THE CENTURY: Laws our Government Agency Leaders don’t know, or are purposely keeping from the Taxpayers! 

By Alexis Stuart, the Credit Whisperer®

Question: can an individual donate to Social Security, Medicare, Medicaid and/or The Department of Defense and write it off as a tax-deductible charitable gift on their taxes?

Can you guess which government agency still refuses to provide a written answer?

Can you guess which government agency provided the correct answer?

Can you guess why any government agency would not want taxpayers to know the Best Kept Secret I have discovered?

Can you guess why none of our government officials or any current presidential candidates are suggesting this idea?

Uncovering this “BEST KEPT SECRET OF THE CENTURY” all started in 2006, with an idea I had to help The Social Security Funds.  I first thought, “Why not donate to Social Security?” Then, I thought, I could start a nonprofit and get people to donate to our mission to help Social Security.  We could use the donations to help people buy or start businesses, create jobs and at the same time contribute to the economy and increase revenue to the Social Security Funds.  In a few years our nonprofit could donate to Social Security Funds when it is scheduled to run out of money.  As a Real Estate Broker and business owner, always looking for another good business to buy, I would follow the progress of small businesses for sale on the Multiple Listing Service. Many times, if the owners could not sell the business, they would end up closing.  I wanted to help employees build their credit power so they could buy the business from their boss, keep it alive and keep all of the employees working.  

This raised the question, “can a nonprofit donate to social security?” Better yet, “can an individual donate to social security and write it off as a tax-deductible charitable gift on their taxes?”

To find the answer I called The Social Security Administration Commissioner’s office on February 2, 2006 and was told by the secretary that she had never been asked that questions before. I was put on hold while she tried to find the answer. The secretary returned and told me she could not find anyone that knew the answer. Because no one in the office knew if donations were allowed, or if an individual could write them off on their taxes, she told me to write a letter to the Social Security Administration Commissioner and pose the question. 

It took three months to get an answer, but I received a letter dated 5/3/06 from Annie White, Associate Commissioner of Social Security Administration stating  “You may be interested to know that section 201(i)(1) of the Social Security Act currently provides for tax-deductible gifts to the Social Security trust funds”. The entire letter is available online at www.creditwhisperer.com/solution.htm   

I did form a nonprofit organization; Credit Power Educational Foundation, Inc., and part of our mission is to “STRENGTHEN our national economy and Social Security Fund”.

After watching many news reports on how the Department of Defense is the main purpose of the Federal Government and how Medicare and Medicaid were also running out of funds, I decided to ask them the same question I asked the Social Security Administration.

On March 14, 2011, I first called the Medicare and Medicaid office and the female who answered the phone said she had never been asked that question before. She put me on hold and then told me she could not find anyone that knew the answer and they would need to have someone call me back. I did not get a return call.

Next on March 14, 2011, I called the Department of Defense, and just like my call to the Social Security Administration, Medicare and Medicaid, was told by the Public Communication Responder for the Department of Defense that he did not know the answer so he put me on hold while he asked someone else. He returned and said they did not know if donations were allowed or if you could write them off on your taxes, so he put in a written request for an answer.

I did receive an email confirming my question and the following is a portion of the answer:

 “Unfortunately the Department of Defense does not accept monetary donations but we thank you for your interest and support.  We encourage you to visit our Community Relations website which lists a variety of pre-screened charitable organizations focused on supporting the military community.  http://www.ourmilitary.mil/help.shtml”

Question Reference #110314-000075

---------------------------------------------------------------

   Topic Level 1: Department of Defense

   Topic Level 2: Policy and Programs

    Date Created: 03/14/2011 02:06 PM

    Last Updated: 03/15/2011 04:14 PM

          Status: Solved

[---001:001561:14959---]

Because of other business activities I did not get back to my quest for an answer with Medicare and Medicaid until May 19, 2011. I again called trying to get an answer to my questions.  I was told to send a letter.  I called back and asked for the Director of Medicare and Medicaid and was transferred to Danette Greenwood, the personal secretary of Dr. Donald M. Berwick. I asked Danette “Can an individual donate to the Medicare or Medicaid Trust Fund and write it off as a tax-deductible charitable gift on their taxes?  Danette was very quick to answer “NO!” 

I asked Danette if I could speak to Dr. Donald M. Berwick and she said “I handle all of his calls”.  I asked if they do not accept donations could Dr. Berwick suggest that Congress, the Senate and President Barack Obama change the law. Danette suggested I contact my congressman to suggest a change in the law. I told Danette that I had already written to many congressmen and Senators and only received a few automated responses.  I suggested that Dr. Berwick has connections it would make more sense for him to bring it to the attention of the IRS, Congress, the Senate and President Barack Obama that we need to change the law so individuals can donate to the Medicare and Medicaid funds and write it off as a tax-deductible charitable gift on their taxes.

Danette finally agreed and told me to email my idea in and she would forward it to Dr. Berwick.  I sent an email on May 19, 2011. I did not get an answer, so I called Danette on June 3, 2011 and asked if she forwarded the email to Dr. Berwick. Danette said she forwarded my email to a group of people who would be responding to my email. Danette said she would check to see if any progress had been made in getting me an answer. I asked Danette if she would please put the answer in writing. Danette said she could not put her verbal “no” answer to my “can you donate question” in writing, but she would send me an email confirming that she received my email.  

I called Danette again on June 6, 2011 at 1:14pm

A man answered phone: “OFFICE OF THE ADMINISTRATOR”. He asked what it was concerning and put me on hold, came back and told me Danette had just gone into a meeting and he said he left a message at her desk.

I asked for his name and he refused to give it. He said it was none of my business and he did not want to be involved in the middle when my business is with Danette.

I then asked for Dr. Berwick and the man who refused to give me his name said he would never forward me directly to him, that Danette takes care of his schedule.

I called back on June 7, 2011 at 12:14 p.m.

I was able to speak to Danette; she said they would be getting back to me next Monday on June 13^th.

Danette still would not send me an email with the verbal “no” answer to my “can you donate question”. She said the other group of people will get back to me.

Danette agreed to send me a confirmation with a time line to get an answer to my question. She also agreed to send me an email after she called the other people to push them for an answer and let me know when I might expect an answer.

I called Danette again on June 8, 2011 at 11:55 a.m. I think I spoke to the same man with no name. He said Danette was in a meeting and she already had my message from before. I asked his name and he refused, saying, “I do not give out my name to anyone outside CMS”.

On June 8, 2011 at 1:21 p.m., I called Danette again and spoke to the man with no name. He said “Danette is busy, it is ongoing”. He refused to let me hold for Danette. I asked if Danette was avoiding me. He claimed Danette was not avoiding me and suggested that I email her.  I told him I was a taxpayer and wanted to hold. He said “That is not going to happen”, and hung up on me.

I sent Danette another email and received a response.

Wed, Jun 8, 2011 at 1:47 PM

RE: Response requested

Hi Alexis,

I will follow up with the component today to see exactly how long they will be in getting you an answer and get back to you as soon as possible.

Regards,

Danette

To see the email go to www.creditwhisperer.com/solution.htm

I still do not have an answer as of July 12, 2011 from Danette, Dr. Berwick, or the “component”.

On June 30, 2011 Danette finally told me to contact Dianne Heffron, the staffer working on an answer.  It took six days for me to finally connect with Dianne Heffron who is the Director of Financial Management Group of the CMSO

Dianne told me she had not received my email. She was able to find my email while I was on the phone. I refreshed her memory as to the fact Danette Greenwood had forwarded my letter and emails to her. Dianne said she was still working on an answer for me. So far she believed that I could donate to Medicaid on the state level, but not to their department. She suggested I contact Toby Douglass, the Secretary of the California Department of Health. She said they only match the state payments. (Another wrong answer)

Dianne said she was still doing research on the Medicare side. She did not know who would even be able to take the donation. She was sure that her department not able to take any donations.  I asked if she could put her answer in writing. Dianne said since the letter was addressed to the Director, Dr. Donald M. Berwick, she could not answer my letter or questions in writing. Dianne said Dr. Donald M. Berwick would need to down-grade the response to her.  She said that could take two weeks to get the down-grade.

I suggested that I send another letter addressed to her so she could answer it. Dianne said that would work, so I re-sent the letter, and another email, addressed to her on July 6, 2011.

I phoned Dianne Heffron on July 12, 2011, but she did not answer, so I left a message. I still do not have an answer.

I sent a letter to Dr. Berwick on June 15, 2011 informing him of the additional information I had uncovered concerning donating to the Medicare and Medicaid Trust.  A copy of the letter is available at www.creditwhisperer.com/solution.htm

Most people are unaware of this option, including Ms Greenwood.

I continued my research after I was told by Danette Greenwood that an individual cannot donate to the Medicare or Medicaid Trust Fund and write it off as a tax-deductible charitable gift on their taxes. 

It seems that contrary to the information I was given by Danette, an individual actually can donate to Medicare and Medicaid and write it off as a tax-deductible charitable gift on their taxes.

I contacted the IRS and spoke to Jacob, i.d. #1054973526.

Jacob put me on hold while he searched for the answer to my question, which was:

“Can an individual donate to Social Security, Medicare, Medicaid and/or The Department of Defense and write it off as a tax-deductible charitable gift on their taxes?”

Jacob told me to look in Pub 78 to find organizations that are currently tax exempt. He said Pub 78 lists most organizations but does not include all organizations and it does not list Federal, State and Local government organizations as they are not required to file for tax exempt status.

I asked Jacob for more details of how donations to a government agency can be written off on your taxes.  Jacob had to put me on hold again to search for additional information.  Jacob instructed me to search for Pub 526 on their website and to look at Table 1, page 2. Table 1 defines “Deductible as Charitable Contributions” for “Federal, state, and local governments, if your contribution is solely for public purposes (for example, a gift to reduce the public debt)”.

Here is the link for pub 526: http://www.irs.gov/pub/irs-pdf/p526.pdf

I asked for additional information to clarify the terminology “public purpose”.

Jacob was unable to answer my question and transferred me to the Tax Exempt and Government Entities Division of the IRS. I spoke to Miss Lee, i.d. # 1001181273.

Miss Lee was also unable to answer my question and needed to put me on hold to find the answer: She did not find anything to further clarify the terminology “public purpose”.

Miss Lee said, Federal, State and Local government organizations are not required to apply for formal recognition. She also said any government organization could request an Affirmation Letter to show that donors could donate to their organization and write it off on the donor’s taxes. 

Miss Lee also suggested that I look at Pub 557, page 30, which defines what a “government unit” includes.

Here is the link for pub 557: http://www.irs.gov/pub/irs-pdf/p557.pdf

I asked Miss Lee if I could get an Affirmation Letter to prove I could donate to a government organization.  She said if I could give her an address, she would search to verify if the government organization was in their system. If she found them in the system she could then send me an Affirmation Letter.

Because I had already spent 1 hour and 45 minutes to get to this point with the IRS, I asked if she could hold while I gathered the addresses for Social Security, Medicare, Medicaid and the Department of Defense.

As I found each address, Miss Lee was able to first confirm the Social Security

Administration, then Medicare and Medicaid, but was not able to confirm the Department of Defense.

Miss Lee said she would send me separate Affirmation Letters for the Social Security Administration, Medicare and Medicaid, that confirms that I can make a charitable donation. I have received the two Affirmation Letters and a copy is available at www.creditwhisperer.com/solution.htm

I asked if I could speak to a supervisor as Miss Lee could not explain why she could not find the Department of Defense in their system. 

Two days later a supervisor, Mr. Cordell, i.d. # 1000196899, returned my call. Mr. Cordell said, “The Taxability of Donations account for the Department of Defense was not active”.  He said if I could contact someone at the Department of Defense and ask them to call (877) 829-5500 they would be able to verify and reactivate their account by phone.

Mr. Cordell said because government organizations are not required to file a 990, their account can go inactive. Once the Department of Defense calls the IRS, they will be able to verify the account and have it placed back into an active status.  After that, I will be able to request an Affirmation Letter for the Department of Defense.

You would think if the head of Social Security, Medicare and Medicaid and the Department of Defense and any other governmental unit could raise extra money via a tax deductable donation they would be talking about it and encouraging as many people as possible. Isn’t this solution better than relying on taxes being raised.

It does raise the question, how to control the spending? We need to get control of the spending and we need reform.  If our government officials were more responsible in how they spend our tax dollars, then the public might be more willing to donate.

It is understood that we need to reform Social Security, Medicare and Medicaid and the Department of Defense. We need to eliminate the fraud and keep our officials from using the funds for unauthorized purposes. The wealthy would be more willing to donate if they had more confidence that the government would protect the funds, and if a firm plan was in place for reforming the systems. The reform is needed no matter if we voluntarily donate or the money is taken from us as a tax.

I have been told by The Social Security Administration, The Medicare Office and The Department of Defense that no one has ever asked if an individual can donate to their organizations and write it off as a tax-deductible charitable gift on the donor’s taxes.   

Once I discovered government employees didn’t have a clue, to prove my point this is the “BEST KEPT SECRET OF THE CENTURY”, I decided to call a few CPA’s in several states and posed the same question. Surely, they will know.  I found that most CPA’s did not have a clue. The CPA’s also did not have any clients that had ever donated to Social Security, Medicare, Medicaid or the Department of Defense or had ever asked if they could. The nicest and most knowledgeable CPA I spoke to was George Williams in Allen, Texas. Thank you George, for your kind words and interest in my quest.

So why do we have laws to allow us to make a charitable donation, yet our government officials, employees and CPA’s don’t know about it?

Why has no one educated the public about this solution to help the entire country?

I feel our country is more important than any embarrassment any government official may fear. Our government officials need to start making the public aware.

Recap as to knowledge of the tax law:

The Social Security Administration has been aware that an individual can donate and write it off as a tax deductible contribution since May 3, 2006 and has not notified the public.

Danette Greenwood gave me an incorrect verbal answer. Danette is the personal secretary to Dr. Donald M. Berwick, the director of Medicare and Medicaid and is still unaware of the law unless Dr. Berwick has read my letter dated June 15, 2011. Dianne Heffron the Director of Financial Management Group of the CMSO

is working on a written answer, but the verbal answer I have received from her is incorrect. I finally received an email response from Danette Greenwood on July 26, 2011 citing IRS Publication 526 after I pointed out this publication in my letter to Dr. Berwick on June 15, 2011.

I sent a letter to Dr. Berwick on July 27, 2011 asking the following:

Now that Peter M. Kelchner, CPA, at CMS, has researched Publication 526 and recognized that the Federal government is considered as a qualified organization for charitable purposes, I again ask the following questions:

1. Will you please set up a donation page on the website for both Medicare and Medicaid?
2. Can you bring this matter to the attention of the public, and the employees of the Department of Health and Human Services? You can even go further and ask the public to voluntarily donate to Medicare and Medicaid instead of relying on their taxes being raised.
3. Can you start an ongoing educational campaign to bring Publication 526 and Section 170(c)(1) to the forefront, so people will realize there is the possibility to donate to Medicare and Medicaid?

On August 20, 2011, I received a letter dated August 15, 2011, from Joseph Dion, Lead Ethics Administrator with the Centers for Medicare & Medicaid Services (CMS). Obviously he did not understand the questions I posed to Dr. Berwick in my letter dated July 27, 2011.

As of August 22, 2011, I have not received an answer from Dr. Berwick to my letter dated July 27, 2011.

Department of Defense sent me a response which was incorrect and may still be unaware unless they read my email dated June 13, 2011. The DOD still needs to contact the IRS at (877) 829-5500 to reactivate their account. I have made multiple calls to the Department of Defense. Commander Kathleen Kessler told me to send a letter to the Secretary of Defense. She told me no one has the authority to connect me to someone that can call the IRS to reactivate their account.  I sent a letter on 7/8/11 to Leon Panetta, the Secretary of Defense. As of August 17, 2011, I have not received an answer from Leon Panetta to my letter dated July 8, 2011. I phoned the IRS to ask for an Affirmation Letter on August 16, 2011 and spoke with Miss Lee, i.d. # 1001181273 again.  Miss Lee told me the Department of Defense is still not showing as an active government unit. Miss Lee submitted a referral asking for a letter referencing the Department of Defense as a government unit as tax deductable. She said it may take 30 days to get a response.

All documents can be viewed at www.creditwhisperer.com/solution.htm

I am just one of the little people. I need the help of government officials, media, teachers and the public to spread the word. You can all make a difference.

Alexis Stuart, the Credit Whisperer®,

is the author of “CAPITALIZE on CREDIT POWER”

This book will build a better country!

You can purchase the book at www.capitalizeoncreditpower.com

or www.creditwhisperer.com

© 2011