Issues that affect ministers and churches
The scam. Over the past several years, a small number of unscrupulous persons have engaged in shameful fear tactics to frighten pastors and other church leaders into attending worthless seminars on church and clergy tax issues. Advertising is filled with misrepresentations and gross exaggerations with one goal in mind—to frighten and intimidate church leaders into attending a tax seminar and buying worthless products and services.
Sadly, some individuals use fear tactics to compensate for their total lack of professional qualifications. After all, anyone can appear knowledgeable and authoritative by frightening seminar audiences with phony IRS forms, false reporting requirements, and wild claims about IRS audits of churches and ministers. Few people are knowledgeable enough to question such tactics.
Tragically, many have been duped into attending such seminars, and have purchased worthless “accounting” and “compliance” services.
Example. One widely promoted and self-proclaimed “expert” has been sued for fraud, investigated by the IRS, and has repeatedly lied to audiences of pastors about his professional qualifications, telling audiences that he is an attorney, a CPA , a college graduate, a tireless lobbyist for churches in Washington, and a frequent spokesman for churches on national news programs and in national publications. All of these claims are false. The “expert” is a college drop-out!
Tip. If you have any doubt about a seminar leader’s qualifications, ask the seminar sponsor to disclose the presenter’s professional qualifications before signing up. If the sponsor informs you that the person is an attorney or CPA, ask for the state or states where he or she is licensed. You can call the bar association or board of accountancy in those states to confirm that the person is a licensed attorney or CPA.
The good news. The good news is that neither churches nor ministers are being “targeted” by the IRS. Anything you read to the contrary is false and has one purpose—to scare you. You do not have to become a victim of such a scam. Fortunately, more and more church leaders are becoming aware of these scams. But as audiences dwindle, the scam artists use even more outrageous advertising to attract new victims.
Example. One organization attempts to frighten church leaders with the prospect of an IRS audit. Statistics are cited concerning the thousands of churches that are audited each year and the thousands of new IRS agents that are being hired to audit churches and ministers. Such statements are false, and are designed solely to intimidate persons into attending a seminar.
Key point. Here are the facts: (1) only a few bona fide churches are audited by the IRS each year; (2) the number of IRS agents that audit exempt organizations has declined in recent years; (3) funding for IRS oversight of exempt organizations is declining; (4) churches have significant protections in the event of an IRS audit as a result of the Church Audit Procedures Act, enacted by Congress in 1985.
Tip. If you leave a seminar in a state of confusion and fear, this is a good indication to stay away from the organization’s services or products.
Take the “seminar attendance pledge”! Protect yourself from being ripped off by taking the following pledge:
Seminar attendance pledge
I understand that the IRS is not targeting churches or ministers for audits or criminal prosecutions. I also am aware that there are unscrupulous and unqualified individuals who are attempting to frighten church leaders into attending tax seminars with intimidating and misleading advertisements. I will not become a victim of these scams and I pledge that I:
- Will NOT waste my church’s resources attending a tax seminar as a result of advertising designed to frighten or intimidate me.
- Will NOT attend a seminar without confirming the presenter’s professional qualifications.
- Will NOT waste our church’s resources paying for an “audit” by a seminar leader who is not an attorney or CPA.
- Will NOT purchase any resources at a tax seminar as a result of scare tactics.
- Will NOT attend a tax seminar if the identity and professional qualifications of the presenter are not disclosed in seminar advertising.