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articles posted 12/06/05
Antiwar Sermon Brings IRS Warning
All Saints Episcopal Church in Pasadena risks losing its tax-exempt status because of a former rector's remarks in 2004.
By Patricia Ward Biederman and Jason Felch, Times Staff Writers
The Internal Revenue Service has warned one of Southern California's largest and most liberal churches that it is at risk of losing its tax-exempt status because of an antiwar sermon two days before the 2004 presidential election. Rector J. Edwin Bacon of All Saints Episcopal Church in Pasadena told many congregants during morning services Sunday that a guest sermon by the church's former rector, the Rev. George F. Regas, on Oct. 31, 2004, had prompted a letter from the IRS. In his sermon, Regas, who from the pulpit opposed both the Vietnam War and 1991's Gulf War, imagined Jesus participating in a political debate with then-candidates George W. Bush and John Kerry. Regas said that "good people of profound faith" could vote for either man, and did not tell parishioners whom to support. But he criticized the war in Iraq, saying that Jesus would have told Bush, "Mr. President, your doctrine of preemptive war is a failed doctrine. Forcibly changing the regime of an enemy that posed no imminent threat has led to disaster."
On June 9, the church received a letter from the IRS stating that "a reasonable belief exists that you may not be tax-exempt as a church . " The federal tax code prohibits tax-exempt organizations, including churches, from intervening in political campaigns and elections. The letter went on to say that "our concerns are based on a Nov. 1, 2004, newspaper article in the Los Angeles Times and a sermon presented at the All Saints Church discussed in the article." The IRS cited The Times story's description of the sermon as a "searing indictment of the Bush administration's policies in Iraq" and noted that the sermon described "tax cuts as inimical to the values of Jesus." As Bacon spoke, 1984 Nobel Peace Prize winner Archbishop Desmond Tutu, a co-celebrant of Sunday's Requiem Eucharist, looked on.
"We are so careful at our church never to endorse a candidate," Bacon said in a later interview. "One of the strongest sermons I've ever given was against President
Clinton's fraying of the social safety net." Telephone calls to IRS officials in Washington, D.C., and Los Angeles were not returned.
On a day when churches throughout California took stands on both sides of Proposition 73, which would bar abortions for minors unless parents are notified, some at All Saints feared the politically active church had been singled out. "I think obviously we were a bit shocked and dismayed," said Bob Long, senior warden for the church's oversight board. "We felt somewhat targeted." Bacon said the church had retained the services of a Washington law firm with expertise in tax-exempt organizations. And he told the congregation: "It's important for everyone to understand that the IRS concerns are not supported by the facts."
After the initial
inquiry, the church provided the IRS with a copy of all literature given out
before the election and copies of its policies, Bacon said. But
the IRS recently informed the church that it was not satisfied by those
materials, and would proceed with a formal examination. Soon after that,
church officials decided to inform the congregation about the
In an October letter to the IRS, Marcus Owens, the church's tax attorney and a former head of the IRS tax-exempt section, said, "It seems ludicrous to suggest that a pastor cannot preach about the value of promoting peace simply because the nation happens to be at war during an election season." Owens said that an IRS audit team had recently offered the church a settlement during a face-to-face meeting. "They said if there was a confession of wrongdoing, they would not proceed to the exam stage. They would be willing not to revoke tax-exempt status if the church admitted intervening in an election."
Amazing! If the church ADMITS to doing wrong, (even though they didn't) the IRS will drop the case? This sounds like extortion plain and simple! Problem here is, it's actually legal and the church asked for the IRS to hoard this over them as have many churches. GREED has caused the preachers of filthy lucre (money) to give the IRS the upper hand on this one. This was planned long ago!
It is already written into the fabric of the law of the land that if you're a church you are tax exempt. BUT, if you are such a man that loves money and you want to be able to walk into Walmart, a car dealership, or even pick up groceries at the local shop & save without paying the sales taxes, you can if you get a 501C3 tax ID number. Thing is, that tax ID number is only supposed to be used for legitimate business purchases. Most preachers get this ID number to illegally evade the sales tax when purchasing items. That greed has caused them this problem. Fact is, we should do as Jesus said when the Pharisee's tried to trick Him into publicly speaking against Caesar by using the "tax" card. He said, "...Render therefore unto Caesar the things which be Caesar's, and unto God the things which be God's." (Luke 20:25)
The 501C3 number is a trap! It is designed to allow big government a foothold into the churches. Yes, charitable organizations, and big businesses should have a break, but churches don't need this. The IRS can and will use this against them just as easy as any back alley loan shark snaps bones. Had they read the fine print when signing up for the already guaranteed tax free status, they would have seen what the IRS placed in the code. The article stated, "The federal tax code prohibits tax-exempt organizations, including churches, from intervening in political campaigns and elections" Yes, it's a vague statement, but that's the beauty of it. They can go after anyone they wish with this law. As long as they're greedy enough to sign on the dotted line that is.
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April 06, 2005
IRS to target religious nonprofit "ministries"
Last year Christian Headlines reported that the IRS had launched an investigation into 2000 nonprofit organizations. This week Internal Revenue Commissioner Mark W. Everson addressed the Senate Finance Committe about about his organization's findings. He also presented the committee with a 14-page letter presenting an overview of the investigation.
A corporation sole is an entity authorized under certain state laws to allow religious leaders to hold property and conduct business for the benefit of a religious entity. The leader may incorporate under state law in his capacity as a religious official. A corporation sole may own property and enter into contracts as a natural person, but only for the purposes of the religious entity. Title in property that vests in the officeholder as a corporation sole passes to the successors in office, and not to the officeholder's heirs. The purpose of a corporation sole is to ensure continuity of ownership of property dedicated to the use of a religious organization.
The corporation sole form of organization serves a valid function for legitimate religious entities. However, some promoters are urging use of corporation sole statutes for tax evasion. Individuals incorporate under the pretext of being a "bishop" of a religious organization or society. The idea being promoted is that the arrangement entitles the individual to exemption from Federal income taxes as a nonprofit, religious organization described in section 501(c)(3). The position is utterly without merit."
Stayed tuned. This week Christian Headlines will have more news to report on several televangelists and excessive compensation practices.
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