IRS Whistleblowers Revisited

March 11, 2021 by

Photo by adil113. CC BY 2.0

Has it really been nearly a year and three months since Lars Nielson released his brother’s whistleblower complaint against the church? What felt like the story that would dominate news of Mormonism in 2020 was quickly buried by Trumpian scandals and then worldwide pandemics.

Like most people, I’ve only thought about the $100 billion endowment fleetingly over the last year or so; I’ve been more wrapped up in translating my job to my home, helping my kids become at-home students, and playing the saxophone.

Monday, though, a court decision came across my desk that made me think of Ensign Peak Advisors and Lars Nielson. See, one reason his brother filed a complaint with the IRS was in hopes of getting a whistleblower award. Statutorily, whistleblowers are entitled to receive between 15 and 30% of the amount the IRS collects as a result of their complaint.

[Read more…]
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#TrumpTaxReturns on The Surly Subgroup

September 29, 2020 by

As far as I know, the only news in the U.S. since Sunday has been the New York Times‘s investigation of leaked Trump tax returns. I certainly know that the first article Sunday evening definitively changed my work schedule for the week.

There’s a lot of information in the article, but there’s also a lot of additional context that tax people can bring to it. I’ve done a bunch of tweeting about the context, and just put my tweets together into a single blog post. (I’ll note that the tweets are better because they are GIF-filled, but the blog post is easier and, as a bonus, links to all of the tweets).

There’s nothing even remotely Mormon-y about this but, to the extent you’re interested in some further content and tax-y goodness, check out the Surly Subgroup.

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Some Thoughts About Ensign Peak Advisers and the Church

December 17, 2019 by

The Religion Unplugged and Washington Post stories raise (at least) three important questions. I’m going to try to address all three here (though at least one will be really quick), and I suspect that this post will be unsatisfying both to those who want to see the church vindicated and those who want to see it get its comeuppance. And that’s because, contrary to popular perception, the tax law isn’t an area full of clear answers and bright lines. It’s also because many tax issues are fact-dependent, and we lack many of the facts. To the extent that you want more information and analysis, Peggy Fletcher Stack has been doing some great reporting on this.

The three main issues I see are these:

  1. Does the church have $100 billion in securities-type investments?
  2. Should the church have $100 billion in securities-type investments?
  3. Does the $100 billion in investments violate the tax law?

Now, I have absolutely no answer to number 1. I’m slightly skeptical, just because growing $12 billion in 1997 to $100 billion today (with two significant market downturns happening in those 22 years) strikes me as requiring some pretty aggressive assumptions. On the other hand, it’s at least plausible. And notably, the church has the ability to tell us how much it’s worth. To the extent it chooses not to do so, assertions like this will continue to find traction. Since the ball’s in the church’s court here, and since I have neither knowledge of nor the ability to find out the net asset value of the church’s investments on my own, for purposes of this post, I’m going to assume that he’s right, and that the church has $100 billion invested in Ensign Peak Advisers.

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Russian Taxes: A Bleg

August 15, 2019 by

Readers know that I’m interested in basically anything that has to do with the church and taxation. And the other day, I was looking at the Church History Library catalog and came across some fascinating snippets about Russian taxes on U.S. missions.

One comes from the Russia Samara Mission, between 1998 and 2001. The catalog summary includes this: “mission’s troubles with Russian tax authorities and KGB regarding financial matters; attempt to register Church in Kazan (15 August 1998.”

The second entry is for journals of a CES missionary in the Russia Rostov na Donu Mission. It includes this entry: “information about Russian tax system and hardship it caused missionaries renting apartments in Russia (22 October 2002).” [Read more…]

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The Parsonage Allowance is a Go

April 2, 2019 by

Old Dutch Parsonage, Sommerville, NJ. By Zeete. CC BY-SA 4.0

On October 24, 2018, the Seventh Circuit heard an appeal in Gaylor v. Mnuchin, the parsonage allowance case. I’ve written several times about this case over the last six or so years (some links in this post), and I checked the Seventh Circuit’s website for the decision incessantly.

And eventually, it released its opinion. Two and a half weeks ago. I’ve been meaning to blog about it, but haven’t had time to do it justice. And I still haven’t, but wanted to at least flag its conclusion and suggest where it may go from here. Maybe sometime in the future I’ll have time to really engage the opinion here.

A quick summary/reminder: the case dealt with the constitutionality of section 107(2) of the Internal Revenue Code. Section 107(2) says that a “minister of the gospel” can exclude from gross income (and thus not pay taxes on) a housing allowance paid by his or her employer. In essence, it represents a religion-specific exception to the general rule that amounts an employee receives from her employer constitute income subject to tax.[fn1] [Read more…]

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The Church Is Going to Pay More In Taxes

January 28, 2019 by

In 1972, the church opened its new Church Office Building at 50 East North Temple Street. The 28-story building, built by Christiansen and Clyde Construction Company for $31.3 million, allowed scattered church employees to all work under one roof. Initially, about 1,500 employees, who had been at 16 different locations, moved into the building. It was originally slated to provide office space to over 2,000 employees. And so that those employees could make it, the Church Office Building had 1,250-spot underground parking garage.

And the existence of that 1,250-spot underground parking garage means that the church owes federal income taxes for 2018.

Because yes, the church owes taxes for last year. And, perhaps to church members’ surprise, those taxes aren’t the result of secular liberals who hate Mormons/religion/God. Those taxes are the result of the Tax Cuts and Jobs Act, the GOP’s late-2017 tax reform that was both conceived of and passed without any input or votes from Democrats.  [Read more…]

Filed Under: Current Events, Economics, Mormon, Politics, Society & Culture Tagged With: , , , , , , , ,

Obligatory #TaxDay Post

April 18, 2017 by

Happy Tax Day![fn1]

Most years (and maybe every year) I do a tax post on Tax Day. I’ve been struggling to think of one the last couple days, though: there haven’t been a whole lot of Mormon tax (or even religious tax) developments over the last several months, and those few there have been[fn2] I’ve already posted on.

So I thought that I’d do something that isn’t really timely, but is interesting. See, as I was researching for my book,[fn3] I came across a Tax Court decision that dealt with the Church of Jesus Christ. I’m pretty sure, name notwithstanding, the Church of Jesus Christ is not part of the family of Mormon churches,[fn4] but its web presence is really, really limited, so most of what I know about it comes from the court’s opinion. Even if the Church of Jesus Christ isn’t a Mormon church, though, the case itself has to engage with Supreme Court tax precedent that is the result of the Mormon church. So here goes: [Read more…]

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On Fred Karger, Tax Exemptions, and the Mormon Church

December 16, 2016 by

Today, Fred Karger asked a provocative question: should the Mormon church lose its tax exemption? To answer that question, he’s asking for certain (anonymous) tips about the church’s use of its money, though implicit in the way he frames the question is that yes, it should. In short, his argument the the church should lose its tax exemption seems to follow these contours:

  • The church has, and earns, lots of money.
  • The church engages in for-profit businesses and investments with that money, and doesn’t pay taxes on its for-profit earnings.
  • The church uses tax-deductible tithing money for lobbying, in contravention of the tax law.

He wants to collect information to ultimately file “the biggest, loudest and most comprehensive IRS challenge to a Church’s tax-exempt status in history.”  [Read more…]

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How Much Accommodation?

June 13, 2016 by

130114152903-abc-schoolhouse-rock-just-a-bill-horizontal-large-galleryLast week on The Surly Subgroup, I wrote about a bill making its way through the House right now. The last section of that bill would make it even harder than it already is for the IRS to audit churches it suspects have campaigning for or against candidates for office.

Reading the bill (and writing the post) crystallized for me a question I’ve had at the back of my mind: how much accommodation should we push for? That is, should there be an upper to the exceptions churches and other religious organizations seek from the law?  [Read more…]

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The Mormon Church in the @PanamaPapers?!? [Updated]

May 10, 2016 by

[Update below]

Yesterday, the ICIJ released its searchable Panama Papers database. (For some background on the Panama Papers, you can look my BCC post or my Surly Subgroup post. Or the ICIJ’s site.) Some enterprising individual appears to have plugged Mormon-related words into the search bar, and came up with at least two hits: Bonneville International and Deseret Investment.

Now, this is exactly what we’re supposed to be doing with this database: searching for those who think they can use tax havens to avoid meeting their obligations. So should you be outraged that the church is doing this?

Short answer: no. But I’m a law professor, so the short answer is never enough.   [Read more…]

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On Oxfam and Your Taxes

January 23, 2015 by

OUS_Logo_h_greenAs Ronan mentioned a couple weeks ago, in 2015, BCC is going to encourage our readers to donate to Oxfam America to aid in its efforts to relieve poverty. Lest our altruism be imperfect, though, I wanted to mention that donating to charitable institutions doesn’t require pure altruism; that is, the warm glow of giving may not be the only benefit you receive from your donation. You may (at least, assuming you’re a U.S. taxpayer) also be able to reduce your taxes. [Read more…]

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Pastors’ Housing, Take 2

November 17, 2014 by

ParsonageHarpersLast week, almost a year after a district court in Wisconsin declared the parsonage exemption unconstitutional, the Seventh Circuit has reversed her decision. And thus ends a (brief) chapter in the religious culture wars.

Or not . . . [Read more…]

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