The money question...

by Tornintwo 50 Replies latest jw friends

• 

  Oubliette

  I posted this comment on a parallel thread:

  The lack of financial transparency was always one of the things that really bothered me about this religion.

  Every congregation publicly reports their accounts every month, but "mother" keeps her's secret.

  To which OrphanCrow responded:

  The WTS' lack of transparency is why the Charity Intelligence Canada has given the Watchtower Society an "F" grade.

  https://www.charityintelligence.ca/charity-details/40-watch-tower-and-tract-society-of-canada

  This got me thinking: That report by the CIC is most telling. A grade of "F" indeed!

  I looked at the linked "Financial Statements." They are very opaque. There is really no way to tell from those statements how the monies are spent or what the assets are or how utilized.

  I'm one guy, with one job and a couple of relatively minor investments and my financial statements are much more detailed than these nonsensical "statements." They are really a joke.
  

  It was interesting to note the $57 million (Canadian Dollars) "Deficiency of revenues over expenses." That's a lot of money to be hemorrhaging. Of course, it could all just be a paper loss moving money from one branch to the other.

  Another interesting tidbit from this report.

  It states that in the 2014 fiscal year, "The Society granted [$35,921,000] to 434 qualified donees in Canada."

  That's nearly $83,000 per "donee" on average. Just who are these people and what did they do to warrant getting such a large grant? That amount is surely much larger than the average JW earns annually.

  Let's review: It's a cult!
• 

  OrphanCrow

  Oubilette: It states that in the 2014 fiscal year, "The Society granted [$35,921,000] to 434 qualified donees in Canada."
  That's nearly $83,000 per "donee" on average. Just who are these people and what did they do to warrant getting such a large grant? That amount is surely much larger than the average JW earns annually.

  That amount is simply representative of a paper transaction to "forgive" Kingdom Hall loans. It is a side step to fall in line with the allowable "donation" system of income. Loans are not considered an allowable form of revenue for charities.
  
• 

  blondie

  Church Audit Process

  The following is the sequence of the church audit process.

  1. If the reasonable belief requirement is met, the IRS must begin an inquiry by providing a church with written notice containing an explanation of its concerns.
  2. The church is allowed a reasonable period in which to respond by furnishing a written explanation to alleviate IRS concerns.
  3. If the church fails to respond within the required time, or if its response is not sufficient to alleviate IRS concerns, the IRS may, generally within 90 days, issue a second notice, informing the church of the need to examine its books and records.
  4. After issuance of a second notice, but before commencement of an examination of its books and records, the church may request a conference with an IRS official to discuss IRS concerns. The second notice will contain a copy of all documents collected or prepared by the IRS for use in the examination and subject to disclosure under the Freedom of Information Act, as supplemented by IRC section 6103 relating to disclosure and confidentiality of tax return information.
  5. Generally, examination of a church’s books and records must be completed within two years from the date of the second notice from the IRS.

  If at any time during the inquiry process the church supplies information sufficient to alleviate the concerns of the IRS, the matter will be closed without examination of the church’s books and records. There are additional safeguards for the protection of churches under Internal Revenue Code section 7611. For example, the IRS cannot begin a subsequent examination of a church for a five-year period unless the previous examination resulted in a revocation, notice of deficiency of assessment, or a request for a significant change in church operations, including a significant change in accounting practices.

  https://www.irs.gov/Charities-&-Non-Profits/Churches-&-Religious-Organizations/Church-Audit-Process

  Special Rules Limiting IRS Authority to Audit a Church

  Tax Inquiries and Examinations of Churches

  Congress has imposed special limitations, found in section 7611 of the Internal Revenue Code, on how and when the IRS may conduct civil tax inquiries and examinations of churches. The IRS may begin a church tax inquiry only if an appropriate high-level Treasury official reasonably believes, on the basis of facts and circumstances recorded in writing, that an organization claiming to be a church or convention or association of churches may not qualify for exemption, may be carrying on an unrelated trade or business (within the meaning of IRC § 513), may otherwise be engaged in taxable activities or may have entered into an IRC § 4958 excess benefit transaction with a disqualified person.

  Additional information

  • Restrictions on church inquiries and examinations
  • Audit process https://www.irs.gov/Charities-&-Non-Profits/Churches-&-Religious-Organizations/Special-Rules-Limiting-IRS-Authority-to-Audit-a-Church http://www.christianitytoday.com/ct/2012/october-web-only/why-irs-has-stopped-auditing-churches-even-one-that-calls-p.html
• 

  blondie

  Church Audits - "Reasonable Belief" Requirement

  The IRS may begin a church tax inquiry only if an appropriate high-level Treasury official reasonably believes, based on a written statement of the facts and circumstances, that the organization: (a) may not qualify for the exemption; or (b) may not be paying tax on unrelated business or other taxable activity. This reasonable belief must be based on facts and circumstances recorded in writing.

  The IRS can obtain the information supporting a reasonable belief from many sources, including but not limited to:

  • Newspaper or magazine articles or ads,
  • Television and radio reports,
  • Internet web pages,
  • Voters guides created and/or distributed by the church,
  • Documents on file with the IRS (e.g. a Form 990-T filed by the church),
  • Reliable information reports from concerned members of the church or the general public and
  • Records concerning the church in the possession of third parties or informants.

  The IRS must derive the facts and circumstances forming the basis for a reasonable belief from information lawfully obtained. If this information is obtained from informants, it must not be known to be unreliable. Failure of the church to respond to repeated IRS routine requests for information is a factor in determining if there is reasonable cause for commencing a church tax inquiry.

  Additional information

  IRM 4.76.7.4.1 (08-20-2010

  https://www.irs.gov/Charities-&-Non-Profits/Churches-&-Religious-Organizations/Church-Audits-Reasonable-Belief-Requirement
• 

  berrygerry

  I've thought for a long time the US needs to do something about how it treats non-profits, so far we haven't.

  If you watched John Oliver when he decided to form his own church, he stated that, in two recent years, the IRS audited only two churches in one year, and only one church in the other year.
  
• 

  Brokeback Watchtower

  That amount is simply representative of a paper transaction to "forgive" Kingdom Hall loans. It is a side step to fall in line with the allowable "donation" system of income. Loans are not considered an allowable form of revenue for charities.

  So the fact that the forgave the loans because they were technically illegal to make being that they were a charity. If I remember right they also charged interest on those loans in the past. So I think this alone warrants a audit plus some stiff penalties I would assume.

  I would be so happy if the IRS did an audit of the WT corporation I'm sure they would find a lot of illegal activity that benefits some third parties when they do.
• 

  LevelThePlayingField

  Regarding that $35.9 million granted to those donees and that amount is simply representative of a paper transaction to "forgive" Kingdom Hall loan...well I remember how it was announced that when the society forgave the KH loans how this was such a loving arrangement and all. Well, hmmm, now wait a minute, think this through for a second. If they can show all this money being pushed back off the books, you know, all these loans being forgiven everywhere it makes them look like they don't have much money receivable, am I right? Then it makes them look pretty thin. Soooo, when lawyers look at the WT to sue them they see less assets.

  Now there is a LOT less assets in New York, a lot less assets the world over. It sounds like there is a lot less money in there coffers. And in another post, in Australia, they are selling Kingdom Halls and combining congregations.

  So, if that was their move on forgiving the KH loans then that was pure evil. "If ever that evil slave..."
• 

  truthseeker100

  Wirerider: Why do I have to pay extra taxes for their water, fire department, police services?

  You are a true American everyone could learn something from you. LOL
• 

  Tornintwo

  Thanks for all the responses, some pure conjecture of course...

  the point Lisa Rose and others make about lack of transparency is very thought provoking though...why aren't they transparent? why so many different corporations etc?

  I knew of an affinity fraud by a 'brother' who fleeced a lot of witnesses of their life savings before being disfellowshipped thankfully, but, he was never prosecuted despite various attempts. Why? Because he had lots bank accounts and companies in different countries, the police couldn't track all the money successfully and prove fraud, they didn't have the resources and jurisdiction wasn't certain....sound familiar?

  what is alarming is that there can be any legal charity which isn't fully transparent about its finances
• 

  Vidiot

  @ Tornintwo...

  It's not all that alarming (well... surprising, anyway) when you realize just how well kickbacks work.