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Author Topic: 3ABN vs IL State Property Tax Lawsuit  (Read 20711 times)

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Fran

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3ABN vs IL State Property Tax Lawsuit
« on: March 16, 2008, 04:32:17 PM »

Go to http://www.revenue.state.il.us/legalinform...s/pt/pt04-1.pdf to read the full document and verify what I have posted.

The words in quotes are not my words. They are words from the 3ABN vs IL State Ptoperty Tax Lawsuit and the 2001 IRS Form 990

Quote
STATE OF ILLINOIS
DEPARTMENT OF REVENUE
OFFICE OF ADMINISTRATIVE HEARINGS
SPRINGFIELD, ILLINOIS


3 ANGELS BROADCASTING NETWORK

Vs.

THE DEPARTMENT OF REVENUE
OF THE STATE OF ILLINOIS

Page 17 # 61 Under subtitle Financial Information beginning on page 15
61. The Independent Auditor’s Reports for 2000 and 2001 state:

Dowlink equipment acquired by gift is not recorded in the financial statements. In our opinion, generally accepted accounting principles require that such donated property be recorded at its fair value at the date of receipt. It was not practicable to determine the effects of the unrecorded equipment on the financial statements.

In connection with the recording of real estate revocable trusts, the fair values of the trusts were based on internal estimates performed by the organization. We were unable to obtain sufficient evidential matter in connection with the estimates of fair value.14 (Applicant’s Ex. Nos. 14,15)15

14 The financial report for 2000 contains additional concerns found by the independent auditors.

15 Applicant’s financial reports raise additional questions and concerns. For example, the unrecorded contribution
revenue related to charitable gift annuity agreements were not recorded in conformance with generally accepted
accounting principles. The “related party transactions” were acknowledged without identifying the parties. The notes
refer to “split interest agreements,” where applicant received the assets funding the trusts and applicant is to pay
certain amounts for specified periods of time to the donors. There is nothing in the record to identify the donors or
the assets. None of the trust agreements were supplied. (Applicant’s Ex. Nos. 14, 15)
Foot notes:


(The 2001 Form 990 has 5 pages of notes attached to the return.)


Quote

Page 1; Statement 2

Form 990, Part I, Line 20

Other Changes in net Assets or Fund Balances
Record Split Interest Agreements previously
unrecorded------------------------------------------------------------------- $2,451,034

Reclassification of amounts due to Other Ministries previously classified as
Temporarily Restricted-------------------------------------------------------$(14,282)

Net Unrealized Gains on Marketable Securities---------------- ---------$13.862

Total Changes in Net Assets or Fund Balance-------------------------$2,450,614


Money Received for other ministries is NEVER INCOME! It is a Liability.

It is a Liability because it is Income for someone else and is to only be held until forwarded to the other ministries. Once that is done, the Liability is cleared. These Liabilities should appear on the Balance Sheet Statement. It should not appear on the 3ABN Income/Loss Statement as it did

This is exactly what I felt would happen to donations that were sent to 3ABN for ADRA. Funds are posted incorrectly and get lost in 3ABN's funds. The other ministry has no idea a donation has been made. That $14, 282 belonged to someone else. This is the amount that maybe the audit found or the Treasurer of 3ABN found. This is why I suggest you always make your donations directly to the ministry you desire.

Does everyone understand what this means? “Other Changes in net Assets or Fund Balances” is where the auditors have made correction entries for the Balance Sheet.

It is where Tax Accountants make changes in fund balances to reflect what actually was. The above are from the final numbers submitted to the IRS Form 990 for 2001. This Form is a Non-Profit Organizations Financial Statement in the form of a Tax Return that must be filed on a yearly basis. These are audited figures. These are supposed to audited by independent auditors.

Split Interest Agreements are:


Quote
The notes refer to “split interest agreements,” where applicant received the assets funding the trusts and applicant is to pay certain amounts for specified periods of time to the donors. There is nothing in the record to identify the donors or the assets. None of the trust agreements were supplied.


These facts stated in the Lawsuit and the Form 990 clearly tell us the financial Statements are not presented accurately. How can I, as an end user, use these reports and have confidence when auditors clearly state that the most basic Generally Accepted Accounting Practices are not being followed by 3ABN.



--------------------

The greatest want of the world is the want of men-- men who will not be bought or sold, men who in their inmost souls are true and honest, men who do not fear to call sin by its right name, men whose conscience is as true to duty as the needle to the pole, men who will stand for the right though the heavens fall. {Ed 57.3}
But such a character is not the result of accident; it is not due to special favors or endowments of Providence. A noble character is the result of self-discipline, of the subjection of the lower to the higher nature--the surrender of self for the service of love to God and man. {Ed 57.4}
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Ozzie

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #1 on: March 17, 2008, 09:54:23 PM »

Intersting that that link no longer exists! Why?  :dunno:
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Bob Pickle

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #2 on: March 18, 2008, 08:34:49 AM »

Intersting that that link no longer exists! Why?  :dunno:

I think the link got copied wrong. Try http://www.iltax.com/legalinformation/hearings/pt/pt04-1.pdf.
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Daryl Fawcett

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #3 on: March 18, 2008, 08:37:22 AM »

The link in the OP was incomplete, therefore, here is the complete link:

http://www.revenue.state.il.us/legalinformation/hearings/pt/pt04-1.pdf

Daryl Fawcett

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #4 on: March 18, 2008, 08:41:49 AM »

Looks like Bob and I did the same thing here. :)

Chrissie

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #5 on: March 18, 2008, 04:37:48 PM »

Looks like Bob and I did the same thing here. :)

Great minds think alike?
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Daryl Fawcett

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #6 on: March 18, 2008, 04:58:37 PM »

Either that, or fools seldom differ. :D

Chrissie

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #7 on: March 19, 2008, 02:17:31 AM »

 :o  :ROFL:
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Gailon Arthur Joy

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #8 on: March 19, 2008, 12:46:01 PM »

Knowing the two of you, I would support the "Great Minds" premise!!!

Although the alternative suggestion, while modest and self-deprivating, was a hoot at the very least!!!

It is the self depricating humor and a reasoned atmosphere that makes this such a joy, pardon the pun!!!
 :TY:

Gailon Arthur Joy
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Ozzie

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #9 on: March 20, 2008, 03:18:59 AM »

Now, I know why I feel comfortable here. Same sense of humour!  :cat:
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Snoopy

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #10 on: April 10, 2008, 07:23:56 PM »

So, 3ABN lost the property tax appeal.  Hopefully they have an adequate financial reserve set aside to cover the back taxes!!
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Fran

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #11 on: April 10, 2008, 08:27:13 PM »

Finally!  Boy, it has been a long time!

Now that clears the way to discuss the audit reports revealed in that lawsuit.  Now there is no reason to keep it out of discussion as it applies to the current lawsuit and the IRS investigation.
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Gregory

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Appellate Court Rules 3ABN Case
« Reply #12 on: April 11, 2008, 06:23:53 AM »

I am certain that there will be many people commenting on the March 31 ruling of the Appeallate Court.  Here is my take on it:

On March 31, 2008, the Appellate court for the 5th District of Illinois delivered a ruling that is of interest to people who follow religious liberty issues.  To directly reference this ruling see:

Three Angels Broadcasting (Plaintiff/Appellant)  v. The Department of Revenue  (Defendant/Appellee), case # 5-05-0724.

Brief Summary of the Background:  On January 28, 2004, an Administrative Law Judge (ALJ) ruled that the majority of the 3-ABN property failed to qualify for exemption from school district taxes.  It limited the exempted property to two pastoral offices.  One, and there were other reasons, was that ALJ ruled that the property was not operated exclusively without profit.

This ruling of the ALJ was adopted by the Department of Revenue on April 7, 2004.

On May 11, 2004 3-ABN requested the Circuit Court of Franklin County to review the ruling.  On August 20, 2004 this court denied the motion to dismiss.

3-ABN then filed for review on March 8, 2005 with the Circuit Court.  This was denied on November 29, 2005.

On December 21, 2005 3-ABN appealed to the Appellate Court, which issued its ruling
on March 31, 2008.

 Appellate Court Ruling:

1)   The court clearly ruled that it must accept 3-ABNs characterization of its programming as religious instruction.  It clearly stated that it did not have the authority to determine the religiosity of 3-ABNs programs.  The court could only determine the other issues in this case after it had accepted 3-ABNs characterization of its programs.

While some might characterize this as a victory for religious liberty it is not.  That dictum is well established in law.  It is grounded in the 1st Amendment to the U.S. Constitution.  It is established in case law and it required before the court could deal with the other issues.

2)   While the Court considered the several issues that 3-ABN raised in its appeal, the major part of its ruling was based upon one issue only.  Under Illinois law and its Constitution, property used for religious use, even if used exclusively for religious use, only qualifies for exemption if that property is NOT used for profit.  It does not matter whether the profit inures to an individual or to the organization itself.  If it is used for profit, it does not qualify for exemption.

3)   The Court found that 3-ABN “. . . failed to meet its burden to prove that its activities on the subject property were. . .” conducted without a view to profit.  It then went on to say:  “ . . . we find that the fact that property is used with a view to profit defeats a religious-use property tax exemption. . ..” 

4)   In another interesting statement, the   Court said:  “ . . . it is abundantly clear from the record that the primary use of TABN’s [sic] property is not to dispense charity to all who need and apply for it.: 

5)   So, the unanimous decision of the Appellate Court was to affirm the decision that the major part of its property was not exempt from taxes for the period in question.




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Bob Pickle

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Appellate Court Rules 3ABN Case
« Reply #13 on: April 11, 2008, 08:13:37 AM »

Back before I got involved with this whole mess, probably in early 2004, a friend with ties to the inside of 3ABN told me the following:

  • Administrative Law Judge Barbara Rowe wanted to decide in 3ABN's favor, but couldn't for some stated reason that I cannot remember.
  • So she put some things into her decision that would make it easy to overturn on appeal.

That's what I recall being told.

Once again we find that info coming out of 3ABN has been factually challenged.
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Snoopy

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Re: 3ABN vs IL State Property Tax Lawsuit
« Reply #14 on: April 11, 2008, 10:09:29 AM »

There is already a thread regarding the property tax case.  Is it necessary to have two?
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