60 Minutes Australia: "Cooking the Book of Mormon"

[rodheadlee]

Analytics I'd like to ask you a question. How do you figure churches are being subsidized by the government just because they're not taking money from the churches?

I'm just a carpenter and don't understand tax codes blah blah blah so the honest question.

[Amulek]

9 hours ago, Analytics said:

I don't understand this "double dipping" you are talking about. 

Gifts aren't considered income for tax purposes, so if you decide you want to start taxing churches then you are going to be taxing that same money twice: once on the giver and then again on the receiver. Not cool. 

 

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Is the government "double dipping" by taxing the investment income of private foundations that hoard their money?

Sort of, but really the excise taxes private foundations are subject to are more of a penalty to ensure that the foundation is actually doing what it set out to do. Unlike most charities, private foundations are generally formed and funded by wealthy individuals, families, etc. The government agrees to let these organizations operate as non-profits, but they put a lot of rules in place to make sure they are actually attempting to further their purported mission and aren't just being used to shelter some of their wealth, tax free. 

 

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America seems to be addicted to using tax law to incentivize behavior that "benefits society." The government thinks solar panels "benefit society," so I get a tax break if I install them on my roof. If I donate money to the local food bank that's tax deductible because that "benefits society." If I donate to the opera so snobs can gather and feel cultured, that is tax deductible too because it "benefits society." All of these perks for behavior the government thinks "benefit society" adds up to over a trillion dollars a year, which increases the tax burden on everybody else. 

Well, fortunately the US Constitution prohibits the government from having a say about whether or not religion is one of those things that benefits society. 

 

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Personally, I'd be in favor of closing all of these loopholes, thereby lowering the tax rates of everybody, atheist and devout religionist alike. But regardless, the fact remains that the government giving huge subsidies and favored treatment to the organizations that meet the IRS's definition of "church" is a clear violation of the establishment clause. 

I hate to break your bubble on this one, but taxing churches isn't going to lower anybody's tax rates. 

According to Giving USA, religious organizations received $128.2 billion in contributions in 2019. Let's be generous and round that up to $150 billion just to be conservative. Now, if we assume a 7.7% rate of "profit" (which would be in line with what corporations pay), that yields just under $11.6 billion in taxable income. If we continue our fantasy land journey and pretend that there are absolutely zero deductions or exclusions involved (and I'm honestly having a hard time even writing that with a straight face), then you would end up with $2.4 billion in federal tax liability.

To put that in context, federal outlays last year ran $6.8 trillion, with the government bringing in $3.8 trillion in revenue. That’s less than 0.04 percent of federal outlays, and 0.06 percent of federal revenue. It’s a rounding error. Besides, churches are undeniably nonprofit organizations, and it would be difficult (read: unconstitutional) to treat them less favorably than secular nonprofits.

 

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That's true for most churches and charities. There are some, however, like the self-declared "public charity" Ensign Peak Advisors, which annually receives about a billion dollars in tax-deductible donations every year, and make another five to ten billion a year in tax free investment income, but then spend literally zero on anything that is charity or religious in nature.

Churches can spend their money on whatever they want, whenever they want. Just because they have decided to generate a positive income stream with their donations currently, doesn't mean that they will never spend that money ever. And just because it's sitting around and not being used in the way you prefer doesn't give you, the government, or anyone else the right to dip their dirty little fingers in the jar to help yourselves. 

 

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If you stop paying your tithing, you aren't going to the temple. That's for sure.

Yes, in our church, paying an honest tithe is a necessary (but not sufficient) requirement for attending the temple. 

However, you can fully participate in every form of public worship without ever spending a dime - same as at most every other church I have ever been to. Country clubs? Not so much.

 

Edited November 13, 2022 by Amulek

[SeekingUnderstanding]

34 minutes ago, rodheadlee said:

Analytics I'd like to ask you a question. How do you figure churches are being subsidized by the government just because they're not taking money from the churches?

I'm just a carpenter and don't understand tax codes blah blah blah so the honest question.

Everyone in a modern functioning society benefits from living in a modern functioning society. Every time we interact with any business or organization they are staffed by people educated in public schools. Nearly person hired by these groups has been through public schools. We all use roads and highways. We have a system of laws, courts, police, judges that set fair expectations and allow all business and commerce to take place. We have government programs to ameliorate poverty, stimulate new discovery’s in science and engineering. Every single facet of our interactions with others is facilitated by tax payer funded institutions and organizations. 
 

The church benefits greatly from all of these things. If they don’t pay for any of it, then other people are paying the bill for them. Hence, their share of the bill to have a modern functioning society is being subsidized by others. 

[helix]

2 hours ago, Analytics said:

and has no plans to do so ever.

You have zero evidence of this.  You've made a lot of black-and-white assertions, without any evidence but your own self assurance that you're right, and it's getting old.

2 hours ago, Analytics said:

However, the $7 billion estimate was made by somebody with a lot more information than Larry T. Willmer's estimate.

There you go again.  Insisting things that you have zero evidence for.  The EPA has zero knowledge of church income.  The leaker provided zero evidence of any church income.  Instead he heavily implied that EPA doesn't know and nobody except the First Presidency and their different financial entity knows.

But you ignore this and insist David's anonymous person must have more information about church income.  Meanwhile, Larry T. Willmer's estimate is based on real data from actual income numbers, and you discount this as being less reliable.

2 hours ago, Analytics said:

My accusation is that the Chruch doesn't have a purpose or a plan for the money beyond saving it for a "rainy day."

What is your evidence for this?

2 hours ago, Analytics said:

Then why are we having this conversation?

Because I'm tired of dishonesty at the church and I'm calling it out.  What the church is doing is constitutional, legal, moral, and following precedent of other large organizations with proportionally larger funds.  We know very, very little about church income, and we know almost nothing what the church plans to do with it.  But that doesn't stop some peanut gallery individuals from inventing knowledge out of thin air without evidence, using that to call the church's actions illegal and immoral, and then insist everything be taxed.  

Now what would be fine is making the argument that no non-profit should get exceptions on investments.  That the one dissenting Supreme Court justice is onto something.  That's fine.  Run with that argument.  It's an argument good enough for a Supreme Court justice and it's got merit.  What's frustrating is this bias on what evidence you invent and what evidence you reject.

[JustAnAustralian]

2 hours ago, Analytics said:

If Ensign Peak Advisors were classified as a private foundation (which is what it really is, it's self-declaration of being a public charity notwithstanding), 

Why do you see EPA as a separate organisation being any different to if it was just fully integrated as part of the main church organisation?

 

[Stormin' Mormon]

45 minutes ago, SeekingUnderstanding said:

Everyone in a modern functioning society benefits from living in a modern functioning society. Every time we interact with any business or organization they are staffed by people educated in public schools. Nearly person hired by these groups has been through public schools. We all use roads and highways. We have a system of laws, courts, police, judges that set fair expectations and allow all business and commerce to take place. We have government programs to ameliorate poverty, stimulate new discovery’s in science and engineering. Every single facet of our interactions with others is facilitated by tax payer funded institutions and organizations. 

Every time a motorist stops to help a pregnant lady change a flat tire, a Sunday School lesson has been put into practice. When a busy mother volunteers at the local food bank, the behavior was first learned in a sabbath lesson. When a refugee family is welcomed with hygeine kits, the labor came from people who believe their god wants them to  put others before self.

I'm not naive enough to belive that religion and churches are the only way that a society can inculcate moral and caring behavior in its citizens. But neither am I naive enough to belive that society gets such little benefit from religion and churches that it must tax them to make up the difference.

Edited November 12, 2022 by Stormin' Mormon

[rodheadlee]

1 hour ago, SeekingUnderstanding said:

Everyone in a modern functioning society benefits from living in a modern functioning society. Every time we interact with any business or organization they are staffed by people educated in public schools. Nearly person hired by these groups has been through public schools. We all use roads and highways. We have a system of laws, courts, police, judges that set fair expectations and allow all business and commerce to take place. We have government programs to ameliorate poverty, stimulate new discovery’s in science and engineering. Every single facet of our interactions with others is facilitated by tax payer funded institutions and organizations. 
 

The church benefits greatly from all of these things. If they don’t pay for any of it, then other people are paying the bill for them. Hence, their share of the bill to have a modern functioning society is being subsidized by others. 

Thank you 

 

[SeekingUnderstanding]

24 minutes ago, Stormin' Mormon said:

Every time a motorist stops to help a pregnant lady change a flat tire, a Sunday School lesson has been put into practice. When a busy mother volunteers at the local food bank, the behavior was first learned in a sabbath lesson. When a refugee family is welcomed with hygeine kits, the labor came from people who believe their god wants them to  put others before self.

I'm not naive enough to belive that religion and churches are the only way that a society can inculcate moral and caring behavior in its citizens. But neither am I naive enough to belive that society gets such little benefit from religion and churches that it must tax them to make up the difference.

Sure, the argument to subsidize donations to charities, is that the public benefit is greater than the cost. How that plays out exactly varies by society. Canada and Australia have different ideas about it than the United States for instance and that’s ok. 

[Stormin' Mormon]

36 minutes ago, SeekingUnderstanding said:

Sure, the argument to subsidize donations to charities, is that the public benefit is greater than the cost. How that plays out exactly varies by society. Canada and Australia have different ideas about it than the United States for instance and that’s ok. 

My point goes just a step or two past that, though.  It's not just that Churches perform charitable functions and do charitable services, all of which could be quantified to a degree and placed in a ledger book to be weighed, counted, and measured.  Churches and religions, though provide additional benefits to society that go beyond their charitable functions and services.  In Sunday schools, in sabbath lessons, in sermons and homilies, they inculcate the values and attitudes that every functioning society wants in their citizenry.  

I'm not saying that's this is the only way to grow a crop of moral and upstanding citizens.  But staying out of the way of churches and religions and letting them do their thing is an incredibly cost-effective way of doing so. 

Edited November 12, 2022 by Stormin' Mormon

[SeekingUnderstanding]

55 minutes ago, Stormin' Mormon said:

In Sunday schools, in sabbath lessons, in sermons and homilies, they inculcate the values and attitudes that every functioning society wants in their citizenry.  

Perhaps? I am intimately familiar with an LGBTQ young man that attempted suicide after experiencing the religious “values” of his friends. Some religions teach that women shouldn’t speak in public, should subjugate themselves to their husbands. Some teach against and shun members for marrying across racial lines. Some teach that women must avoid men all together and wear cloth bags over their bodies in public. 
 

So are there some public goods from religion? Sure. But there are a lot of huge public harms as well IMNSHO. 

Edited November 12, 2022 by SeekingUnderstanding

[Stormin' Mormon]

26 minutes ago, SeekingUnderstanding said:

Perhaps? I am intimately familiar with an LGBTQ young man that attempted suicide after experiencing the religious “values” of his friends. Some religions teach that women shouldn’t speak in public, should subjugate themselves to their husbands. Some teach against and shun members for marrying across racial lines. Some teach that women must avoid men all together and wear cloth bags over their bodies in public. 
 

So are there some public goods from religion? Sure. But there are a lot of huge public harms as well IMNSHO. 

This is an appeal to emotion and an argument from the margins. I'm not sure what you expect me to do with it.

Yeah, some religions teach unsavory things. No argument from me. But some charitable organizations are corrupt, some labor unions are fronts for organized crime, and some democratic processes grant power to despots and demagogues. Does that mean the jury is still out on the societal value of charities, unions, and democracy?

Even with the unsavory margins, there is a vast amount of good that is done by those societal institutions. Likewise, the vast majority of religions teach the virtues of honesty, meekness, and empathy.

 

[SeekingUnderstanding]

8 minutes ago, Stormin' Mormon said:

This is an appeal to emotion and an argument from the margins. I'm not sure what you expect me to do with it.

Yeah, some religions teach unsavory things. No argument from me. But some charitable organizations are corrupt, some labor unions are fronts for organized crime, and some democratic processes grant power to despots and demagogues. Does that mean the jury is still out on the societal value of charities, unions, and democracy?

Even with the unsavory margins, there is a vast amount of good that is done by those societal institutions. Likewise, the vast majority of religions teach the virtues of honesty, meekness, and empathy.

 

You said “in sabbath lessons, in sermons and homilies, they inculcate the values and attitudes that every functioning society wants in their citizenry.” I merely pointed out the opposite is true as well. There are “values and attitudes” taught by your church that I want excluded from the citizenry of every functioning society. So when evaluating, we really need to make sure the good you extol outweighs the bad. 

[Stormin' Mormon]

34 minutes ago, SeekingUnderstanding said:

You said “in sabbath lessons, in sermons and homilies, they inculcate the values and attitudes that every functioning society wants in their citizenry.” I merely pointed out the opposite is true as well. There are “values and attitudes” taught by your church that I want excluded from the citizenry of every functioning society. So when evaluating, we really need to make sure the good you extol outweighs the bad. 

That applies to everything that society finds value in, and yet it still finds value in their generalized application.  

Whatever. I didn't intent to wander into the philosophical weeds on this.  I was just chiming in to point out that there are very good reasons why a society would choose not to tax churches and religions, and in doing so, society is not giving free rides to anybody.  Churches provide value for the tax status they are granted.  We can quibble over how much that value actually is, but at that point, we're just haggling over price.

[Analytics]

On 11/12/2022 at 2:13 PM, rodheadlee said:

Analytics I'd like to ask you a question. How do you figure churches are being subsidized by the government just because they're not taking money from the churches?

I'm just a carpenter and don't understand tax codes blah blah blah so the honest question.

I'll illustrate the point with a simple example. Say there is a society with two people--religious Rory and secular Steve. Rory and Steve each make $500 a year, so the total income of the society is $1,000.

The government of this society needs $100 a year to operate, or 10% of the total income. The baseline way of sharing the tax burden is everybody pays 10%. Rory pays $50 a year, and Steve pays $50 a year.

Say the government wants to provide a direct cash subsidy to Rory in the amount of $100 a month. To fund that, it would need to increase its total income by $100, so it would need to increase the tax rate to 20%. So in this direct cash subsidy example, Steve would pay $100 a year in taxes, Rory would pay $100 a year in taxes, so the government would receive a total of $200. It would then use $100 for its normal expenses, and would use the remaining $100 to pay Rory's subsidy. The net effect is that Steve pays a net $100 to the government and Rory pays $0 to the government.

The exact same after-tax result could be attained if we just decided Rory didn't have to pay any taxes--if Rory doesn't pay taxes, then Steve's tax bill is increased to cover it. For both Rory, Steve, and the government, the direct cash subsidy is financially equivalent to the tax break.

On 11/12/2022 at 2:50 PM, Amulek said:

Sort of, but really the excise taxes private foundations are subject to are more of a penalty to ensure that the foundation is actually doing what it set out to do. Unlike most charities, private foundations are generally formed and funded by wealthy individuals, families, etc. The government agrees to let these organizations operate as non-profits, but they put a lot of rules in place to make sure they are actually attempting to further their purported mission and aren't just being used to shelter some of their wealth, tax free. 

You just described to a T why Ensign Peak Advisors ought to be subject to those same rules. It makes billions in investment income every year, pays zero in taxes, and pays zero for any charity or religious purposes.

On 11/12/2022 at 3:04 PM, helix said:

You have zero evidence of this.  You've made a lot of black-and-white assertions, without any evidence but your own self assurance that you're right, and it's getting old.

EPA continually asks what the money is to be used for so that they can invest the money appropriately. The Presiding Bishopric and First Presidency never gave them any guidance. That is why Roger Clarke speculated that it is being saved "for the second coming of Christ."

Mormon Church Reportedly Amassed $100 Billion Fund For ‘Second Coming Of Christ’ (forbes.com)

On 11/12/2022 at 3:06 PM, JustAnAustralian said:

Why do you see EPA as a separate organisation being any different to if it was just fully integrated as part of the main church organisation?

EPA is a separate organization. President Hinckley was getting nervous about how rich the church was getting, so it created EPA so that the Church could donate money to EPA and then look the membership and public in the eye and say the Church itself isn't hoarding money.

 

 

[Analytics]

On 11/12/2022 at 7:05 PM, Stormin' Mormon said:

That applies to everything that society finds value in, and yet it still finds value in their generalized application.  

Whatever. I didn't intent to wander into the philosophical weeds on this.  I was just chiming in to point out that there are very good reasons why a society would choose not to tax churches and religions, and in doing so, society is not giving free rides to anybody.  Churches provide value for the tax status they are granted.  We can quibble over how much that value actually is, but at that point, we're just haggling over price.

Two brief points: First, many highly secular countries (e.g. Norway, Denmark, Netherlands) are much, much nicer in almost every way than many, many highly religious countries (Afghanistan, Iran, Algeria, Ghana); it isn't obvious that the "value" religion adds to society is a net positive.

Second, note that having this conversation in a rational manner concedes that the real foundation of ethics is humanism, not religion. After all, you did not say, "Every time a woman covers her face before going into public, a Sunday School lesson has been put into practice. When a busy mother refuses to drink coffee, the behavior was first learned in a sabbath lesson. When a refugee family is not allowed the rights of citizenship in their own country, the bigotry came from people who believe their god thinks they are superior than their non-Jewish neighbors. (Everything you need to know about human rights in Israel and Occupied Palestinian Territories - Amnesty International). You didn't refer to uniquely religious morals because by definition, morals that come only from religion are at best arbitrary and at worst are downright evil. The examples of religion teaching people to be better human beings are examples of religion teaching people to embrace the secular ethics of humanism. That's the best thing religion can do, but we don't need religion to do it.

As Steven Weinberg said, "With or without religion, good people can behave well and bad people can do evil; but for good people to do evil - that takes religion."

Edited November 14, 2022 by Analytics

[Stargazer]

On 10/29/2022 at 1:48 AM, california boy said:

Seems to me, the same people complaining about the students gaming the system are the same ones justifying the Church gaming the tax loophole.

Everyone who pays taxes uses / games tax loopholes. Do you own a home with a mortgage, and do you offset your income with the interest you have to pay on that mortgage, along with the property taxes in order to reduce your tax liability?

It seems like a case of saying "How dare you use a perfectly legal tax loophole!" while using a perfectly legal tax loophole.

Or pot calling the kettle black, as the old aphorism goes.

[Amulek]

1 hour ago, Analytics said:

You just described to a T why Ensign Peak Advisors ought to be subject to those same rules. It makes billions in investment income every year, pays zero in taxes, and pays zero for any charity or religious purposes.

And why should a church who has the good fortune of not needing my gift today be forced to let that money sit in a bank and depreciate over time?

Why shouldn't they be allowed to let my gift appreciate at the market rate so that they can have the full value of that money when it comes time for them to actually use it?

 

[Analytics]

1 minute ago, Amulek said:

And why should a church who has the good fortune of not needing my gift today be forced to let that money sit in a bank and depreciate over time?

Why shouldn't they be allowed to let my gift appreciate at the market rate so that they can have the full value of that money when it comes time for them to actually use it?

 

I'm not arguing that a church should "be forced to let that money sit in a bank and depreciate over time." I'm arguing for the opposite, in fact.

If any organization or individual wants to hoard money then that should be their choice. However, if a self-described "charity" makes billions of dollars every year in investment income but literally never spends a single dime on any charitable work ever, it should be required to pay taxes on the investment income. Tax incentives should incentivize doing something good with money, not incentivize hoarding.

Despite its assertions to the contrary, EPA is a private foundation and ought to be taxed as such.

 

[SeekingUnderstanding]

8 minutes ago, Amulek said:

And why should a church who has the good fortune of not needing my gift today be forced to let that money sit in a bank and depreciate over time?

Why shouldn't they be allowed to let my gift appreciate at the market rate so that they can have the full value of that money when it comes time for them to actually use it?

 

Can you explain the public utility gained from wealth accumulation?

[Danzo]

On 11/12/2022 at 10:17 AM, Analytics said:

But regardless, the fact remains that the government giving huge subsidies and favored treatment to the organizations that meet the IRS's definition of "church" is a clear violation of the establishment clause. 

Something that I am constantly having to remind some of my clients who come up with wacky constitutional theories to avoid paying tax is that Although your legal and constitutional theories make sense to you, there are no judges or any other legal authorities that have accepted your reasoning.   If you are going to have your theories accepted as law you have to persuade more people than just yourself.

[Danzo]

On 11/11/2022 at 1:07 PM, Analytics said:

Just because it's popular for the government to subsidize IRS-preferred churches doesn't make it Constitutional.

Having the all the judiciary agree that it is constitution is precisely what makes it constitutional. 

[Danzo]

30 minutes ago, SeekingUnderstanding said:

Can you explain the public utility gained from wealth accumulation?

People (and entities) who accumulate savings are more free and have more options in life.

I am constantly having this discussion with my clients.  If you have savings, you are much less dependent on your boss, your family and society as well.  Someone with a large savings account will be less likely to go on public assistance and will better be able to pay for their medical expenses (not having to rely on government), can take care of themselves in their old age (not from the government).

Also if your boss becomes abusive or unpleasant, you can tell him "to take this job and shove it" much more easily than someone with no savings and who lives paycheck to paycheck. 

Not living from paycheck to paycheck also allows you more free time to develop relationships and otherwise serve in the community or church

Having wealth accumulated can also reduce the anxiety from living paycheck to paycheck and allow for the certainty to make long term plans.

Having wealth accumulated also allows you to make investments in yourself, your community and your country. 

[Analytics]

1 hour ago, Danzo said:

Something that I am constantly having to remind some of my clients who come up with wacky constitutional theories to avoid paying tax is that Although your legal and constitutional theories make sense to you, there are no judges or any other legal authorities that have accepted your reasoning.   If you are going to have your theories accepted as law you have to persuade more people than just yourself.

Two points:

1- There is a difference between offering your own well-considered opinion on the Constitutionality of something and giving legal advice about how well an argument would hold up in court. For example, if somebody thinks that the Supreme Court was wrong for 50 years and that the Constitution doesn't really grant a right to an abortion, there is no shame in making your argument as to why you think they were wrong. 

2- The insinuation that "no judges or any other legal authorities" have accepted my reasoning on this point is false. For example, in Texas Monthly, Inc. v. Bullock, Supreme Court justices William Joseph Brennan Jr., Thurgood Marshall, and John Paul Stevens agreed with exactly what I've been arguing here, and the opinions of Supreme Court justices Byron Raymond White, Harry Andrew Blackmun, and Sandra Day O'Connor largely overlap what I'm saying here. Likewise, in Walz v. Tax Commission of the City of New York, Supreme Court justice William O. Douglas agreed with my specific point: giving tax exemptions to religious institutions violates the establishment clause.

I'm not saying that in our extraordinarily religious culture my views are popular. But the idea that they are "wacky constitutional theories" and that "there are no judges or any other legal authorities that have accepted [my] reasoning" is false. Full stop.

Edited November 14, 2022 by Analytics

[california boy]

1 hour ago, Stargazer said:

Everyone who pays taxes uses / games tax loopholes. Do you own a home with a mortgage, and do you offset your income with the interest you have to pay on that mortgage, along with the property taxes in order to reduce your tax liability?

It seems like a case of saying "How dare you use a perfectly legal tax loophole!" while using a perfectly legal tax loophole.

Or pot calling the kettle black, as the old aphorism goes.

You missed the point of my post.  I was only comparing the Church gaming the tax system with those students that game BYU when they no longer believe. 

[Stargazer]

2 minutes ago, california boy said:

You missed the point of my post.  I was only comparing the Church gaming the tax system with those students that game BYU when they no longer believe. 

Comparing the Church's "gaming" to those students' "gaming" in the way you did seems to suggest that you feel they are equivalent acts. Or am I missing something? Anyway, the term "gaming" is pejorative. Does this mean that you feel the Church's legal use of tax laws is equivalent to the students' no longer believing as they attend BYU? Which would make them ineligible to continue to attend, as I understand it, so they must "game" the system by not admitting their state of belief. I don't think these two situations are equivalent at all. Though I do feel that a member who loses his or her belief in the Church should not be kicked out of the school because of that.

One point in all this is that the Church pays for BYU as a benefit for members, and non-members are admitted on sufferance. If you're no longer a member, then it is questionable as to whether you should be there by right, or by sufferance. 

It is the case that non-members are welcome to attend BYU, if they agree to adhere to the honor code. They aren't required to believe. There was an interesting thread on Reddit that dealt with the question of attending as a non-Mormon. One person in the thread expressed a degree of concern for his last 7 months there because apparently he stopped believing not long before he graduated, and had to keep this quiet. But one non-member poster who attended BYU was quite enthusiastic about the school and his experience there. If you're interested, the Reddit thread is here.