Attorney-at-Law

“IS THERE, FOR HONEST POVERTY?”

In Uncategorized on 09/12/2016 at 23:20

Well, answering Scotland’s Greatest, Judge Paris says it’s not honest poverty, when confronting Ronald W. White, 2016 T. C. Memo 167, filed 9/12/16.

Rev Ron is founder and pastor of the World Evangelical Outreach Church (WEOC) in Defuniak Springs, FL, and has been these past thirty years. Rev Ron “…ministered from the pulpit and at nursing homes, helped build churches on foreign soil, established a feeding program for children, and supported widows and orphanages.” 2016 T. C. Memo. 167, at p. 3.

Rev Ron convinced his board of advisors to restructure the church as a corporation sole under the name and style of “The Office of Presiding Head Apostle, of Ronald Wayne White,” which claimed to be a domestic Nevada corporation, although all its operations were based in Florida.

And Rev Ron signed a Vow of Poverty. And didn’t file returns or pay tax on better than $300K he got over a four-year stretch.

If this sounds like a mail-order dodge from fifteen years ago, see my blogposts “Not Reasonable But Not Negligent,” 8/1/13, where Judge Paris dealt with the same scenario, and “The End of An Affair,” 8/26/15.

Same story here. “Petitioner acknowledges that WEOC or its related entities made payments on his behalf for his personal expenses. Petitioner’s primary contention is that his vow of poverty insulates him from being taxed on the compensation he received for his services to WEOC.” 2016 T. C. Memo. 167, at p. 6.

And even though all payments went through the church bank account, Rev Ron was sole signatory thereon.

But Rev Ron claims he got the money from the church, not from third parties, unlike all the cases that theretofore nailed these dodges.

Judge Paris: “Petitioner’s argument, however, is misguided. The Court has previously noted that cases in which a taxpayer receives money from a third party (a party other than the religious order) and remits that money to the religious order in accordance with his vow of poverty are factually distinguishable from cases in which a taxpayer executes a vow of poverty to a religious order and receives money directly from the religious order.” 2016 T. C. Memo. 167, at p. 8. (Emphasis by the Court) (Citations omitted).

Rev Ron wants to rely on a 1919 Treasury pronouncement, but that was superseded in 1977. The rule is that whatever the impoverished gets must be given back to the church, leaving the impoverished only the minimum necessary to survive.

Rev Ron kept it all.

And Rev Ron didn’t file a Section 1402(e)(3) exemption certificate, so he owes SE. The rule is strict; the clergyperson must file timely.

Looks like Scotland’s Greatest has the last word.

 

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