James huntsman (jon's brother) sues church for 'fraud'

[ttribe]

4 hours ago, Analytics said:

I stand corrected. Does Ensign Peak Advisors use fund based accounting, and do they have a "tithing" fund and a "investment income" fund? 

Unlikely, IMO.

[CV75]

28 minutes ago, Scott Lloyd said:

No. That’s silliness. My paycheck is my paycheck. Its value is frozen in time. Any interest that accrues on that value is is not part of my paycheck. It is separate and apart from what I received from my employer and flows from my own industry and thrift in managing that value after it was conveyed from my employer’s possession to mine. My good fortune in receiving interest or return on investment is no more attributable to my employer than it would be his fault if I had squandered the funds on casino gambling. 
 

Added later: Suppose I scrimped and saved funds from my paychecks over time and used those funds to establish a successful Pizza Hut franchise. Are you saying my pizza business must be regarded as part of the pay I received from my employer? 

In the case of the Church, I suppose it just has to be demonstrated that the principal and interest are used for ultimately charitable purposes under the law. It seems this has been accomplished year in and year out. 

[Analytics]

4 minutes ago, ttribe said:

FYI - All SEC Filings by Ensign Peak Advisors, Inc. can be found here - https://www.sec.gov/edgar/browse/?CIK=1454984

Thanks. Eight weeks after the Washington Post publicly announced the whistleblower complaint in December 2019, Ensign Peak Advisors filed its first quarterly 13F-HR with the SEC, which it has filed every quarter since.

 

[Calm]

2 hours ago, webbles said:

You are basically the only person that seems to think that it isn't an integrated auxiliary.

And somehow this has been missed by the IRS for how many years now?

[Analytics]

35 minutes ago, Scott Lloyd said:

No. That’s silliness. My paycheck is my paycheck. Its value is frozen in time.

You may reject the time value of money. Your choice.

[ttribe]

11 minutes ago, Calm said:

And somehow this has been missed by the IRS for how many years now?

I'm not opining on the compliance of EPA relative to the cited rules, but I think we generally overestimate the oversight capabilities and enforcement resources of the IRS.

[bluebell]

1 hour ago, SeekingUnderstanding said:

But it’s not your money right? It’s the interest off your money. At least that seems to be what people in this thread are saying. That the interest on tithing is not tithing. So the interest on the your taxes is no longer taxes, hence not your money. Am I missing something?

Ok, I misunderstood what you were asking. 

But I agree completely, because once I give the government my money, it's no longer my money.  Even if they didn't make any interest off of it and stick it in a sock drawer somewhere, it's still not my money.

That's how it works when you give someone something.  It ceases to be yours.

Now, the issue of compulsion comes into play when discussing reasonable ways to react to how an organization chooses to use the money that we give them.  But that sounds like a different discussion than the one you were aiming for.  Sorry for the confusion.

 

[Calm]

5 hours ago, HappyJackWagon said:

It is stressed MULTIPLE times that a child or youth should NEVER be alone with an adult behind closed doors.

I am not that confident that they aren’t throwing out the baby in their efforts to get rid of dirty bath water. 
 

Kids are not prone to open up to adults about abuse. Removing all opportunities for privacy seems like it would dramatically lower any inclination to do so.  
 

I also wonder how many signs of abuse are missed because the adult only interacts with a child when surrounded by distraction, interfering with their ability to focus on the minor. 
 

I am not saying that a general rule to avoid adults other than parents being alone with kids isn’t a good one. But since parents and close family members and friends are the most likely source of abuse and this rule does nothing for those cases, making it absolute troubles me. I would like to see data that it results in an overall drop in abuse and not just a drop in abuse by teachers, leaders, and other authority figures while potentially increasing abuse of the family and friends variety due to less reporting by victims. 

Edited August 18, 2021 by Calm

[Stormin' Mormon]

14 minutes ago, Analytics said:

You may reject the time value of money. Your choice.

 

I have hesitated to weigh in on this topic because I do not have a background in finance or economics. 

But, you keep using this phrase.  I don't think it means what you think it means.  The time value of money means that a dollar now is worth more than a dollar in the future, not the other way around as you originally described it some pages back.  https://www.investopedia.com/terms/t/timevalueofmoney.asp.  It's used to determine which investments are more sound: the one that will pay out $1 million dollars next year or the one that will pay out $1 million in five years.  With no TVM, both would be equally sound investments.  But money has a time value, and so investors would rather back that first investment rather than the second one.

The TVM is the reason that interest accrues.  Not the other way around.  Money accrues interest because it has time value, it doesn't have time value because it accrues interest. 

Finally, my paycheck is my paycheck.  Its value is a single defined value.  I pay into my state's retirement fund based on that value.  My employer pays payroll taxes based on that value.  At no point does the amount of my pension contribution or of my employer's payroll taxes change because I have earned interest on the funds received in my paycheck.  The value of the paycheck is the value of the paycheck.  Full stop. 

 

 

 

[SeekingUnderstanding]

47 minutes ago, bluebell said:

Ok, I misunderstood what you were asking. 

But I agree completely, because once I give the government my money, it's no longer my money.  Even if they didn't make any interest off of it and stick it in a sock drawer somewhere, it's still not my money.

 

Close. More like the government says it would never spend taxes to fund abortion. Then it turns out that the government was funding abortion. When people get upset, they say they were just using the interest off of some tax revenue in an investment account so no big deal. No taxes went to abortion. I wouldn’t accept that as reasonable and am surprised that others think that distinction makes a difference. 

[webbles]

1 hour ago, Analytics said:

Technically, EPA is an independent entity. If a court was aware of its existence and significance it would ask about it. Sure. But if the court wasn't aware, the Church would comply with the request and wouldn't proactively offer the additional information.

I think the Church was trying to hide the existence and scope of this money as much as possible. That is the reason for EPA existing. If you have any other theories about the reason the Church went to the effort of creating EPA, my ears are open. 

But why was it trying to hide its money?  The only reason you've come up with is to prevent judges/courts from finding it.  But since they created the EPA with the intention of it being an auxiliary, then it wouldn't have been hidden.  None of the data that I've seen shows that the EPA was formed to hide money.

1 hour ago, Analytics said:

For people outside those seven individuals, there are asterisks that explain there are limitations to their access.

It seems to me that whether the IRS decides they owe any taxes or not, when "A Letter to the IRS Director" was released 20 months ago the Church scrambled in filing some reports with the IRS and SEC and changed how it was doing things. This was done, it seems, because the Church's experts weren't aware of the situation until David Nielsen blew the whistle. 

Well yeah, there would be limitations to their access.  Those extra groups that I mentioned have a lot of employees.  It wouldn't make sense for all of those employees with access.  But it does show that other than those seven individuals have access.  And those other individuals are more experts than the seven individuals.  Plus, I would assume that the EPA itself was composed of experts.  I don't believe that "Church experts" were not aware of what was happening.

 

1 hour ago, Analytics said:

I'm sure that was the basic intention.

When it was originally formed, in all likelihood the Church's attorneys explained what EPA needed to do in order to meet the IRS's qualifications of being an integrated auxiliary. I'm sure their original intentions were great. However, once it started operating the Church probably didn't consult with its attorneys on a year by year basis about the legal and tax ramifications of their decisions vis-à-vis remaining a lawful integrated auxiliary.  

The bottom line is that from a legal perspective, EPA is holding its own money, not the Church's. According to David Nielsen's credible allegations, commercial purposes are the only thing it does with the money. If he is right about that, then it isn't an integrated auxiliary of the Church, it is a private foundation. That isn't illegal, but private foundations do need to use some of their money for charitable purposes in order to avoid taxes. Since EPA has never used any of its money for a charitable purpose ever, it has a gigantic tax bill due.

Yes, the whistleblower's argument is that the EPA should not be considered an auxiliary but a private foundation.  And if the IRS decides that way, EPA would have a large tax bill.  But, the whistleblower didn't prove that it should be classified as a private foundation.  And if the EPA is an integrated auxiliary, then the money is still the Church's because EPA is just an auxiliary.

I think we all agree that it was planned as an integrated auxiliary and that the EPA and Church believe it is an integrated auxiliary.  The question isn't over how it was started or what EPA or the Church thinks.  It is over what it is now.  And all the experts that I read online say that it can still be classified as an auxiliary.  So, I'm glad that the whistleblower was able to convince you, but he hasn't seemed to convince the experts that I've been reading.  If you could point to a tax expert who agrees that the EPA should be classified as a private foundation, I'd love to see it.  The closest I've come to is where an expert says that the law is ambiguous and that the IRS would need to decide which way to read the rule.  But none of said that the law is unambiguous like you are doing.

[Calm]

15 minutes ago, webbles said:

So, I'm glad that the whistleblower was able to convince you

Are you really though?  

Edited August 18, 2021 by Calm

[Analytics]

10 minutes ago, Stormin' Mormon said:

I have hesitated to weigh in on this topic because I do not have a background in finance or economics. 

But, you keep using this phrase.  I don't think it means what you think it means.  The time value of money means that a dollar now is worth more than a dollar in the future, not the other way around as you originally described it some pages back.  https://www.investopedia.com/terms/t/timevalueofmoney.asp.  It's used to determine which investments are more sound: the one that will pay out $1 million dollars next year or the one that will pay out $1 million in five years.  With no TVM, both would be equally sound investments.  But money has a time value, and so investors would rather back that first investment rather than the second one.

The TVM is the reason that interest accrues.  Not the other way around.  Money accrues interest because it has time value, it doesn't have time value because it accrues interest. 

Finally, my paycheck is my paycheck.  Its value is a single defined value.  I pay into my state's retirement fund based on that value.  My employer pays payroll taxes based on that value.  At no point does the amount of my pension contribution or of my employer's payroll taxes change because I have earned interest on the funds received in my paycheck.  The value of the paycheck is the value of the paycheck.  Full stop. 

Thanks for the feedback.

As an example of how professionals look at this, Frank Fabozzi, Ph.D., CFA, CPA wrote the following in the 6th edition of The Handbook of Fixed Income Securities in Chapter 3 ("A Review of the Time Value of Money," page 41):

"Illustration 6. Suppose a money manager has the opportunity to purchase a financial instrument that promises to pay $800,000 four years from now. The price of the financial instrument is $572,000. Should the money manager invest in this financial instrument if she wants a 7.8% annual interest rate?

"To answer this, the money manager must determine the present value of the $800,000 to be received four years from now. The present value is $592,400, as shown below...

"Because the price of the financial instrument is only $572,000, the money manager will realize more than 7.8% annual interest rate if the financial instrument is purchased and the issuer pays $800,000 four years from now."

The owner of this financial instrument will in fact receive a check for exactly $800,000 in exactly four years.  But the check has three different values:

• Its value on the day it is payable ($800,000)
• Its market value today ($572,000)
• The present value of the cash flow today ($592,400)

Remember. These three values are all talking about the value of the same $800,000 check.

It's the same concept with your paycheck. The way professionals look at this, the pay check you receive today is called a cash flow. A cash flow has a single defined amount, and a specific day when it is paid. However, the value of the cash flow depends upon how far in the future (or past) the cash flow is, as well as what the interest rate is.

FWIW

[Danzo]

1 hour ago, Analytics said:

It's funny how you originally asked me to quote from the law and from the IRS to defend my position. Now that I've done so, you ignore it and pretend what the IRS says and what the law says doesn't matter.

The law matters. Your strained intreptation of the law doesn't

I get that.  People are always trying to tell me how they have figured out how to get around taxes because the 16th ammendment wasn't ratified correctly, or how the US government cannot tax a sovereign Citizen, or how they can contract out thier income to someone else, or how they can create some sort of corporation seperate from themselves to spend their money, or how they can make themselves a minister and take a vow of poverty, etc. 

They all come up with some clever reading of the law to justify their position, but I always have to point out to them that no Judge or IRS official interprets the law that way.  Their intrepretation or skewed reading of the law doesn't matter.  Its the IRS's iterpretation and the Courts intreptation that counts.

1.   The law §509, says churches are excluded from the definition of a private foundation

2. EPA is wholly owned (in that the funds invested in it are 100% conrtrolled and used for its benefit) by the church.  The wealth it owns or controls is in no meaningful way distinct from the church. It is not independent from the church in any meaningful sense.  Tax Laws do not accept assignment of income or assets that lack economic substance.

Therefore, EPA is not a private foundation because the tax code, as intrepted by the IRS, the courts and anyone who matters in our legal system recognizes EPA as part of the church.  

Religious organizations invest money. They invest in banks (savings Account), they invest in real estate, they invest in bonds.  Sometimes they invest through an investment adviser, sometimes they create  a seperate division.  Non of these things make them a private foundation.  

 

 

 

[Analytics]

5 minutes ago, Danzo said:

People are always trying to tell me how they have figured out how to get around taxes because the 16th ammendment wasn't ratified correctly, or how the US government cannot tax a sovereign Citizen, or how they can contract out thier income to someone else, or how they can create some sort of corporation seperate from themselves to spend their money, or how they can make themselves a minister and take a vow of poverty, etc. 

Has anybody told you they've figured out how to get around their taxes by calling their private foundation a church?

5 minutes ago, Danzo said:

They all come up with some clever reading of the law to justify their position, but I always have to point out to them that no Judge or IRS official interprets the law that way.  Their intrepretation or skewed reading of the law doesn't matter.  Its the IRS's iterpretation and the Courts intreptation that counts.

Exactly.

5 minutes ago, Danzo said:

1.   The law §509, says churches are excluded from the definition of a private foundation

Irrelevant, because Ensign Peak Advisors isn't a church.

5 minutes ago, Danzo said:

2. EPA is wholly owned (in that the funds invested in it are 100% conrtrolled and used for its benefit) by the church.

That doesn't mean it isn't a private foundation.

5 minutes ago, Danzo said:

 The wealth it owns or controls is in no meaningful way distinct from the church. It is not independent from the church in any meaningful sense.  Tax Laws do not accept assignment of income or assets that lack economic substance.

Cavalierly disregarding the clear language and intent of the laws because you personally don't like what it implies about Ensign Peak Advisors isn't a legal argument.

But thank you for sharing your opinion with me.   

 

[Analytics]

49 minutes ago, webbles said:

And all the experts that I read online say that it can still be classified as an auxiliary.  So, I'm glad that the whistleblower was able to convince you, but he hasn't seemed to convince the experts that I've been reading.  If you could point to a tax expert who agrees that the EPA should be classified as a private foundation, I'd love to see it.  The closest I've come to is where an expert says that the law is ambiguous and that the IRS would need to decide which way to read the rule.  But none of said that the law is unambiguous like you are doing.

It's interesting how people only see what they want to see. Professionals need to hedge their language, so it isn't surprising that they will always say everything is ambiguous even when it really isn't. In this case, the Church has unfathomable political power and politically, nothing could be less popular in America than going after a church with a tax bill in the tens of billions of dollars. Because of that, the IRS will figure out a way to justify letting the Church off the hook.

From an excellent article that Smac posted earlier, with emphasis added:

"Is Ensign Peak Advisers violating the tax law?

"It’s not entirely clear. The Post reporters talked to Phil Hackney for the story, which was a really good move on their part. Phil is a friend, and knows a ton about the law governing tax-exempt organizations. And Phil points out that, if Ensign Peak Advisers has only held and invested money, and never paid any out, that’s probably a bad thing.

"Quick note here: when we’re talking about potential tax violations, we’re not really talking about the institutional church. Rather, we’re talking about Ensign Peak Advisers, a separate tax-exempt entity. As best as I can tell, Ensign Peak Advisers is an investment fund/adviser that the church uses to invest its additional money. And, according to the whistleblower, while money goes into Ensign Peak, it doesn’t come out. Rather, it’s invested and continues to grow.

"And this is potentially a tax problem. Ensign Peak Advisers is a “supporting organization” and an “integrated auxiliary.” To qualify for a tax exemption, it (probably) has to meet the requirements of section 501(c)(3) of the Code independently. And, uncontroversially, managing a securities portfolio isn’t one of the tax-exempt purposes listed in section 501(c)(3)."

Some Thoughts About Ensign Peak Advisers and the Church – By Common Consent, a Mormon Blog

Its funny to read him say that it is "probably" a bad thing for a self-proclaimed public charity to never pay out any money in charity and that it "probably" has to meet the requirements of section 501(c)(3) of the code.  The moral of the story is some organizations have to abide by the law. Some probably don't.

[bluebell]

1 hour ago, SeekingUnderstanding said:

Close. More like the government says it would never spend taxes to fund abortion. Then it turns out that the government was funding abortion. When people get upset, they say they were just using the interest off of some tax revenue in an investment account so no big deal. No taxes went to abortion. I wouldn’t accept that as reasonable and am surprised that others think that distinction makes a difference. 

I don't think there is a real great way to compare the two, because of the vast differences between taxes, tithing, and investments. 

Tithing is a result of a commandment from God, for example, while investment returns from it are not.  As a result tithing is considered sacred while investment returns are not.  Theologically speaking, tithing and investments are--for all intents and purposes--apples and oranges.  Especially when it comes to their purpose and what is an acceptable use for them.  

Taxes and the investments that come from them have the same theological value (which most people would say was zero).  There value is the same; it's just the value of the money.

The church recognizes the difference between tithing and money from investing tithing as have different acceptable uses because of the bold above.  It would be reasonable for members (who have the same religious beliefs) to view them differently because of the bold above as well.  

In that way, it's not unreasonable for the church to say "no apples were used to build this mall" even though oranges were.  

 

[mgy401]

5 hours ago, secondclasscitizen said:

It isn’t the job of a tithe payer to prop up a failing for-profit business. If it was our obligation why didn’t we bail out everyone?

Wow.  People say the Mormons are heartless about business, but you could certainly teach us new ways to justify hurting people!

First—they were our businesses, and our contracts.  We were honor-bound to make good on them if we could, so we did.

Second—if you’ve already sunk $10 into an investment, and you are faced with the prospect of either losing it all or adding another $2 knowing that the added capital will eventually let you eventually recoup your entire investment (or even just $3 or $4 of your initial investment)—the latter course of action is just the smart thing to do, mathematically speaking.

Look, guys; I know some of you practically soiled your underpants imagining the virulent rantings you’d compose about a church that let a business entity run into bankruptcy, or had defaulted on life insurance policy obligations, or had let a major portion of downtown SLC become a half-completed slum.  I don’t know what to tell you.  The Church is solvent, and seems likely to remain so for the foreseeable future; and you’ll just have to deal with it.

Edited August 19, 2021 by mgy401

[Bob Crockett]

7 hours ago, Analytics said:

That isn't my point. You are a straight shooter so I'd like your opinion on what I've been arguing.

In summary:

• Ensign Peak Advisors is a 501(c)(3) that isn't owned by the Church or by anybody else. Like all non-profits, it isn't owned. Rather, it is a standalone entity controlled by its board of trustees.
• The $100 billion question is how EPA should be categorized by the IRS: is it a public charity, a private foundation, or an integrated auxiliary?
• According to some links to irs.gov I provided above, certain things are required for a 501(c)(3) to be a public charity. Basically, they have to engage in something that the IRS recognizes as being charitable in nature. I've argued that EPA doesn't meet the requirements. Not even close. It doesn't do any charitable work and it doesn't give money to any charitable causes (unless giving money to build a mall and bail out an insurance company can successfully be construed as charitable).
• According to irs.gov, only public charities can be integrated auxiliaries.
• Therefore, EPA is a private foundation and should be taxed as such. 

I represent churches and schools.  They all use private foundations to handle contributed funds. I realize that nobody owns a non profit but if you set up your foundation to admit only apostles of your church to be board members, well ....

One of my clients is a religion which operates over a thousand hospitals.  It has a foundation composed of faithful members of its church who live near one of its medical schools. It also allows nonmembers on the board but they must always be a minority. 

It is a charitable use to hold and accumulate principal.  I used to fund raise for a private university. 

Thus private foundations with a religious purpose are not taxed. In any way.  That is against my libertarian philosophy but that is not relevant. 

It is not likely the church would ever expend the principal.  Ever.  That is not how these institutions work. 

These institutions do not put all their funds in liquid investments like the stock market.  That would be foolish.  They are particularly attracted to operating farms. They often develop real estate. 

Not all of their investments turn a profit. 

I can't comment on EPA, but if an institution can make an investment that indirectly benefits the institution, so much the better. A hospital may use its private foundation to acquire and develop medical office buildings near the hospital to attract medical groups that would likely drive patients to the hospital.

I am not aware of any law that would require a foundation to invade the corpus if it is in fact using the income for charity.  But I am not a non profit guy. 

Edited August 19, 2021 by Bob Crockett

[secondclasscitizen]

5 hours ago, mgy401 said:

Wow.  People say the Mormons are heartless about business, but you could certainly teach us new ways to justify hurting people!

First—they were our businesses, and our contracts.  We were honor-bound to make good on them if we could, so we did.

Second—if you’ve already sunk $10 into an investment, and you are faced with the prospect of either losing it all or adding another $2 knowing that the added capital will eventually let you eventually recoup your entire investment (or even just $3 or $4 of your initial investment)—the latter course of action is just the smart thing to do, mathematically speaking.

Look, guys; I know some of you practically soiled your underpants imagining the virulent rantings you’d compose about a church that let a business entity run into bankruptcy, or had defaulted on life insurance policy obligations, or had let a major portion of downtown SLC become a half-completed slum.  I don’t know what to tell you.  The Church is solvent, and seems likely to remain so for the foreseeable future; and you’ll just have to deal with it.

First the church isn’t honorbound to save beneficial life. It was a for profit separate entity of the church. Likely it was bailed out to save face for the church so it didn’t have to explain why inspired financial advisors and insurance salesmen got the whole thing wrong. That is what happens when you sell rip-off whole life insurance and ripoff annuities and guarantee a ridiculous return. The whole industry got caught with its pants down and the churches own guys did too.

these are the products that generate the most complaints in the industry and our good ole Mormon boys are selling them too. Just like our mlm “financial advisors” we have in many wards working for trans America and primerica rah rah mlms. 
 

why should some African or Brazilian family who can’t feed their kids subsidize a failing for profit insurance company with their tithing? They can’t even feed themselves and yet the church is using their tithing and gold teeth to bail out their failure. 
 

same goes for tithing subsidizing BYU. Over  80% of the students are white and about 60-70% are from Utah, Texas, California, az and idaho. Why are poor members tithes being used to subsidized the college education of a bunch of white kids from five states and for all mission presidents kids and the kids of GAs? The same people who can afford the college.
 

all a load of crap. Jesus would not be happy with this. 

Edited August 19, 2021 by secondclasscitizen

[Kenngo1969]

On 8/17/2021 at 9:53 AM, Analytics said:

Having reserve funds is great. In general, an organization the size of the Church should have reserves around $10 billion to $20 billion. Exactly where the line is drawn is blurry and subject to debate, but saving much more than $20 billion "for a rainy day" is indisputably hoarding.

 

Ipse dixit?  And, while I am not a finance expert, I would say that whether a particular reserve fund is adequate depends, in large part, on what the organization sees as its mission and what it intends to do with the funds, as well as on what the organization's powers-that-be think is likely to happen in the future that might have an impact on those funds.

[Analytics]

10 hours ago, secondclasscitizen said:

First the church isn’t honorbound to save beneficial life. It was a for profit separate entity of the church. Likely it was bailed out to save face for the church so it didn’t have to explain why inspired financial advisors and insurance salesmen got the whole thing wrong. That is what happens when you sell rip-off whole life insurance and ripoff annuities and guarantee a ridiculous return. The whole industry got caught with its pants down and the churches own guys did too.

these are the products that generate the most complaints in the industry and our good ole Mormon boys are selling them too. Just like our mlm “financial advisors” we have in many wards working for trans America and primerica rah rah mlms. 

From my perspective, this is an argument for why the Church shouldn't have been in the insurance business to begin with. It seems they learned their lesson and are pulling out.

I think the Church has a moral obligation to guarantee the insurance contracts its insurance subsidiary agreed to, just as, for example, GE has the moral obligation to guarantee the insurance contracts in its subsidiary organizations. On this one, they are doing the right thing.

[Analytics]

 

14 hours ago, Bob Crockett said:

I represent churches and schools.  They all use private foundations to handle contributed funds. I realize that nobody owns a non profit but if you set up your foundation to admit only apostles of your church to be board members, well ....

One of my clients is a religion which operates over a thousand hospitals.  It has a foundation composed of faithful members of its church who live near one of its medical schools. It also allows nonmembers on the board but they must always be a minority. 

It is a charitable use to hold and accumulate principal.  I used to fund raise for a private university. 

Thus private foundations with a religious purpose are not taxed. In any way.  That is against my libertarian philosophy but that is not relevant. 

It is not likely the church would ever expend the principal.  Ever.  That is not how these institutions work. 

These institutions do not put all their funds in liquid investments like the stock market.  That would be foolish.  They are particularly attracted to operating farms. They often develop real estate. 

Not all of their investments turn a profit. 

I can't comment on EPA, but if an institution can make an investment that indirectly benefits the institution, so much the better. A hospital may use its private foundation to acquire and develop medical office buildings near the hospital to attract medical groups that would likely drive patients to the hospital.

I am not aware of any law that would require a foundation to invade the corpus if it is in fact using the income for charity.  But I am not a non profit guy. 

The problem is that Ensign Peak Advisors (allegedly) isn't using the investment income for charity either. Literally not a single penny over its entire existence.

According to the IRS:

"Private foundations are required to spend annually a certain amount of money or property for charitable purposes, including grants to other charitable organizations.  The amount that must be distributed annually is ascertained by computing the foundation’s distributable amount.  The distributable amount is equal to the foundation’s minimum investment return with certain adjustments.

The distributable amount must be distributed as qualifying distributions.  However, a foundation may set aside funds for up to 60 months for certain major projects. Excess qualifying distributions may be carried forward for a period of five tax years immediately following the tax year in which the excess was created.  Special transitional rules apply to foundations created before May 27, 1969.

A foundation that fails to pay out the distributable amount in a timely manner is subject to a 30 percent excise tax under section 4942 on the undistributed income. "

Taxes on Failure to Distribute Income - Private Foundations | Internal Revenue Service (irs.gov)

That is why Ensign Peak Advisors is arguing so adamantly that that it is NOT a private foundation. If the IRS decides that it is a private foundation, its excise tax bill under section 4942 will be in the tens of billions.

[MrShorty]

12 hours ago, Kenngo1969 said:

I would say that whether a particular reserve fund is adequate depends, in large part, on what the organization sees as its mission and what it intends to do with the funds

I think this is true. One of the interesting things I recall reading in some of the links that @Analytics provided in a previous discussion is that these "experts" on church finances and rainy day funds warned churches against having a rainy day fund whose sole purpose or intent is to grow wealth. These people (and Analytics, and I might also add myself to the list) think that a fund whose sole purpose is to grow wealth is inappropriate for a church. Based on behavior rather than words, it appears that the Ensign Peak fund's sole purpose is accumulating value (at present it's current value appears to be between 10 and 20 times the Church's current total annual expenses including charitable giving). It's not being used to help pay Church expenses or to donate to charitable causes or anything (other than a couple of "bailouts").

I know we haven't actually answered the question, but how much is enough and how much is hoarding?

[JAHS]

10 minutes ago, MrShorty said:

I think this is true. One of the interesting things I recall reading in some of the links that @Analytics provided in a previous discussion is that these "experts" on church finances and rainy day funds warned churches against having a rainy day fund whose sole purpose or intent is to grow wealth. These people (and Analytics, and I might also add myself to the list) think that a fund whose sole purpose is to grow wealth is inappropriate for a church. Based on behavior rather than words, it appears that the Ensign Peak fund's sole purpose is accumulating value (at present it's current value appears to be between 10 and 20 times the Church's current total annual expenses including charitable giving). It's not being used to help pay Church expenses or to donate to charitable causes or anything (other than a couple of "bailouts").

I know we haven't actually answered the question, but how much is enough and how much is hoarding?

The real question is what does the prophet know is going to be needed for the future? Does he know something we don't know?