11 ms·

Kickstarter is a shop and should be regulated like a shop. What would happen to Amazon if a pre-order failed and I didn't get a refund? If it were an investmen

by billpg 11y ago

Kickstarter is a shop and should be regulated like a shop. What would happen to Amazon if a pre-order failed and I didn't get a refund? If it were an investment site, you'd be getting shares for your money.

cwyers 11y ago
It's neither. What Kickstarter really is is a donations platform. It's like when PBS holds a fundraiser and you get a bag for donating $X to support your local PBS station. (This isn't quite right either, as PBS just buys the bags, if Masterpiece Theater doesn't finish shooting an episode on time it doesn't imperil bag delivery, but it's a lot closer than either of Kickstarter The Store or Kickstarter The Investment Platform.)
- reagency 11y ago
  Right, and the difference between PBS and KS is that PBS is actually capable of delivering the promised reward, not perpetuating a fraud. KS used to be a preorder system to fund bulk orders of pre-production invented hardware. Then it became a scam platform.
- dmfdmf 11y ago
  I agree, after reading all these comments and links it has to be viewed as charity donations. They need to sever ANY expectation of outcome and can't offer any inducements or incentives or promises to buy, etc. In essence a Kickstarter project says "Here is my project, please give me money" as long as that is clear then the govt may leave it alone but perhaps there are different regs on charities. Also, the IRS might have something to say about the tax status of gifts over $10K, so recipient will have to pay income tax upfront.
  - _delirium 11y ago
    Fwiw if they're legally gifts (which is not always obvious, consult your tax professional etc.), gift tax in the U.S. is payable by the gifter, not the recipient: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Frequently-Asked-Questions-on-Gift-Taxes#1 http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employ... I believe this is because it's mainly aimed at wealthy estates who're trying to end-run the estate tax by conveying large amounts of money to would-be heirs via gifts instead.
    - dmfdmf 11y ago
      I agree these are questions for a tax pro. Also, I think the gift tax and rules are different for related vs non-related parties. If you pulled $100K in "gifts" from a Kickstarter project I'd bet the IRS would rule that as income, if they haven't already.
superuser2 11y ago
When you back a Kickstarter project, you accept the (diclosed) risk that you will not get anything for your money if the project fails. This is the nature of Kickstarter. Otherwise people would just do Amazon preorders like everyone else. If you don't like this, don't back Kickstarter projects. It doesn't matter that you believe Kickstarter is a shop - you are wrong and the expectations you invent and project onto an organization do not and should not give it legal obligations.

by billpg 11y ago

cwyers 11y ago

It's neither. What Kickstarter really is is a donations platform. It's like when PBS holds a fundraiser and you get a bag for donating $X to support your local PBS station. (This isn't quite right either, as PBS just buys the bags, if Masterpiece Theater doesn't finish shooting an episode on time it doesn't imperil bag delivery, but it's a lot closer than either of Kickstarter The Store or Kickstarter The Investment Platform.)

reagency 11y ago
Right, and the difference between PBS and KS is that PBS is actually capable of delivering the promised reward, not perpetuating a fraud. KS used to be a preorder system to fund bulk orders of pre-production invented hardware. Then it became a scam platform.
dmfdmf 11y ago
I agree, after reading all these comments and links it has to be viewed as charity donations. They need to sever ANY expectation of outcome and can't offer any inducements or incentives or promises to buy, etc. In essence a Kickstarter project says "Here is my project, please give me money" as long as that is clear then the govt may leave it alone but perhaps there are different regs on charities. Also, the IRS might have something to say about the tax status of gifts over $10K, so recipient will have to pay income tax upfront.
- _delirium 11y ago
  Fwiw if they're legally gifts (which is not always obvious, consult your tax professional etc.), gift tax in the U.S. is payable by the gifter, not the recipient: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Frequently-Asked-Questions-on-Gift-Taxes#1 http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employ... I believe this is because it's mainly aimed at wealthy estates who're trying to end-run the estate tax by conveying large amounts of money to would-be heirs via gifts instead.
  - dmfdmf 11y ago
    I agree these are questions for a tax pro. Also, I think the gift tax and rules are different for related vs non-related parties. If you pulled $100K in "gifts" from a Kickstarter project I'd bet the IRS would rule that as income, if they haven't already.

superuser2 11y ago

When you back a Kickstarter project, you accept the (diclosed) risk that you will not get anything for your money if the project fails. This is the nature of Kickstarter. Otherwise people would just do Amazon preorders like everyone else. If you don't like this, don't back Kickstarter projects. It doesn't matter that you believe Kickstarter is a shop - you are wrong and the expectations you invent and project onto an organization do not and should not give it legal obligations.