I am still hoping the IRS can simply start rejecting charitable deductions for fixed donations, based on the following section of the agreement:
Quote:
VII. Treatment of Parishioners' Contributions
VII.B. Until … December 31, 1999, the Service agrees not to contest the deductibility of Church of Scientology fixed donations in connection with qualified religious services (those appearing on the "Scientology Classification, Gradation and Awareness Chart." )...
…, for as long as this paragraph B. of this section VII. applies, as set forth in paragraph F., the full amount of the fixed donation for these services shall be treated as a charitable contribution under Code section 170… END QUOTE
My translation: Until the year 2000, the IRS will allow without protest any "fixed donations" for auditing and other courses to be deducted as charitable contributions.
However, probity said that the agreement can't be re-opened, and I am not a tax lawyer, so I have stopped actively pushing this idea. I do think it could be "final" that there is a December 31, 1999 moment when things change. Based on the input from probity, I rewrote my summary as follows:
My understanding is that the IRS can't go back before Dec 31, 1999 and change anything. It would also be an unwelcome fight to change the tax treatment for the years 2000-2011, since the IRS appears to have allowed tax deductibility for fixed donations for religious services in those years, under the protection of Omnibus Budget Reconciliation Act of 1993. But, the IRS could for the 2012 tax year FIGHT CoS and any of its so-called charities, now, saying they "failed the operational test*" and are NOT charities because, allegedly
1. Miscavige violated rules on self-dealing (Miscavige's lavish lifestyle suggesting his hand is in the cookie jar),
2. Miscavige knowingly committed acts of fraud or criminal conduct that might constitute a violation of public policy, as laid out in the St. Pete Times articles, hitting and imprisoning staff, allowing child labor, etc.
3. Miscavige was a sole dictator with pre-signed letters of resignation for those under him on corporate boards. For example, Heber Jentzsch is in mysterious and probably abusive seclusion, despite being a President. Other highest officers were forced out rather than the legally required dignified resignation. This violates federal and California charity policy about no single leader with unchecked power.
4. CoS aggressively pushes its members to fund-raise and donate to Int'l Assoc of Scientologists and other legal-attack corporations, which claim to be unattached to the Church of Scientology Int'l and the other top "religious" corps, but of course are deeply linked. These monies go into private investigators and anti-free-speech lawsuits which are not a suitable use of a charity's resources. IAS and its related attack-orgs are NAMED in the IRS Secret Agreement.**
5. CoS gets religious privileges, yet mixes religious with non-religious. The Secret Agreement says,
Quote:
VII.B. Until … December 31, 1999, the Service agrees not to contest the deductibility of Church of Scientology fixed donations in connection with qualified religious services (those appearing on the "Scientology Classification, Gradation and Awareness Chart." )...
…, for as long as this paragraph B. of this section VII. applies, as set forth in paragraph F., the full amount of the fixed donation for these services shall be treated as a charitable contribution under Code section 170…
My translation: Until the year 2000, the IRS will allow without protest any "fixed donations" for auditing and other courses, to be deducted as charitable contributions.
These must be listed on the Scientology Classification, Gradation and Awareness Chart at
http://www.whatisscientology.org/html/P ... 181_1.html . One flaw here is that Section 170 requires that the institution getting those tax-deductible donations must be “exclusively religious.” But, on that Chart is “Allergy or Asthma Auditor Rundown Course” which is medical, not religious. Another flaw would be if the Chart changed over the year. Was it fixed in place in 1993? If the Asthma course was added later, does that get tax deductibility, too?
6. Commissions*** are allowed in the Secret Agreement, for a staff or public who persuades someone to take a course. The only duty is, the person receiving the commissions reports them on their taxes. But how can this be "exclusively religious" if the church is making such a profit off the course, that they can pay a commission? Are clerks or accountants properly recording each commission, and reporting it to the IRS so the IRS can match the amount on the salesperson's tax return? How high are these commissions, because it gets very uncharitable if someone is paying for auditing, getting a tax deduction for it, and then a high percentage of the money, rather than "supporting the church" or "helping the community," is going right into someone's pocket. This is highly unspiritual and crass.
Miscavige gained tremendous power within CoS by winning the tax exemption; underlings may hate and fear him but think they'll lose the tax exemption if he is forced out. If CoS loses the tax exemption while Miscavige is in charge, his position is greatly weakened. Especially if he's on trial for assault and battery.
I now accept Probity's claim that we can't easily fight the tax deduction for auditing services, because the Omnibus Budget Reconciliation Act of 1993 was too generous about fixed fees for some religious services. Probity recommended instead using the operational test against CoS:
*The Operational Test: Bruce Hopkins, Law of Tax-Exempt Organizations, 8th edition wrote:
Quote:
4.5 OPERATIONAL TEST
(a) In General
An organization, to qualify as a charitable entity, is regarded as operated exclusively for one or more tax-exempt purposes only if it engages primarily in activities that accomplish one or more of its exempt purposes. The IRS observed that, to satisfy this operational test, the organization's "resources must be devoted to purposes that qualify as exclusively charitable within the meaning of section 501(c)(3) of the Code and the applicable regulations." An organization will not be so regarded if more than an insubstantial part of its activities is not in furtherance of an exempt purpose. An organization is not considered as operated exclusively for one or more exempt purposes if its net earnings inure in whole or in part to the benefit of private shareholders or individuals. An organization can be substantially dominated by its founder without, for that reason alone, failing to satisfy the operational test. A court concluded, however, that an organization cannot qualify for tax exemption where one individual controls all aspects of the organization's operations and "is not checked" by any governing body.
** My CoS Organization Charts lay out the key CoS entities, including those covered by the Secret Agreement: Each entity named in that agreement, like
Religious Technology Center, is
underlined.. See
viewtopic.php?f=9&t=31561 .
Narconon which blatantly defrauds, mistreats, and neglects its drug-recovery victims, is only one of the Secret Agreement corps groups failing as a charity.
(also posted at OPERATION SUNSHINE WEEK FTW!!1! (Mar13-19 2011),
posting.php?mode=edit&f=166&p=394639***
Quote:
IV.E.3. …all commissions … from Scientology-related entities to individual fundraisers are properly reported to the Service by the payor…
Most of the above thread is further discussed at
viewtopic.php?f=9&t=29926