Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[Stan]

Did anyone explain about paid $7,000 for a home and then selling it for market value?

I am going through a similar type of event, not my home, wish it was.

It could very well be that the CPA's here explained that, but I can not find it..

[Bob Pickle]

It's a good question.

Simpson personally told me, from what I recall, that the auditors believed there was nothing wrong with the transaction. But I made the point in a court filing, from what I recall, that those auditors wouldn't dare put that in writing and jeopardize their careers.

This much is certain: Even though we have been filing about this issue since I think Dec. 2007 or Jan. 2008, the plaintiffs never once filed any proof that the transaction was totally above board.

If you were a party to a suit like this, wouldn't you want proof of such in the record? Now that the case is in appeal, they have nothing to point to in the record to show that there was nothing wrong with the transaction. Not even an affidavit from the auditor, Alan Lovejoy.

[Bob Pickle]

Now I think I misunderstood your question. Were you wanting to know how it allegedly worked in Danny's situation?

[Stan]

When we spoke before, I really did not have any experience in this kind of thing in trust work, I took it in school, but have never had hands on. Please keep in mind I am not an Attorney, Barrister or Solicitor, nor do I have a professional accountant designation.  I do not know tax laws in which ever state this happened in.

Here is a situation I am dealing with, and it is far from completion.  The numbers I am about to give are in the ballpark, but not close enough to identify this transaction.  Because of lack of Death Tax in Canada, things like this never happen to prevent taxes.  With that understanding I will explain, and this shed light to me on what happened.

A nice property, was gifted to us, not fully appraised but more than likely about a million dollars. It has a life tenancy with the property, that person is far from retirement.

So what kind of tax receipt to we give?

It would be the same amount of that we would sell the property for.

Well, under 100,000.

WHY?

We have to take the net prevent value (NPV) of the projected actuarian study of the projected life span of this person who can live in it until she passes, if it is a couple, it ends up being the projected life span of the second to die, usually the female.

Perhaps a CPA could clarify that more.

[Stan]

I hope that did not sound hostile or sarcastic..

[Bob Pickle]

See http://www.irs.ustreas.gov/pub/irs-pdf/f8283.pdf and http://www.irs.ustreas.gov/pub/irs-pdf/i8283.pdf.

This form says it must be filled out if donations of property are more than $500. If more than $5,000, it says an appraisal must be obtained by the donor. The donee specifically must say, "This acknowledgment does not represent agreement with the claimed fair market value." Thus, it would appear, any receipt the donee gives cannot have a dollar amount on it, which, I think, is what Fran said somewhere.

And all this raises another question: Was the property 3ABN sold to Danny ever donated to 3ABN? If so, when was that? If it was sold less than 3 years after being donated to 3ABN, Form 8282 would have to be filed. Was it?

[Stan]

I doubt if it was donated..  (To Danny I mean - Just edited to add that for clairification)

What did he pay for that "IF" he had life tenancy, 2 things

1 - The $7,000 or whatever it was
and
2 - Lifetime living in it at no charge, based on actuarial studies and based on second to die in the marriage, or in a few cases a designated child, or in some cases, and I think this is just in Canada, 20 years past the date of the second to die, of a designated child or other beneficery. (That last one about 20 years is from memory from a class 8 years ago, so it may not be correct.)

TOTAL of 1 and 2 = Value of home = No gift.

As I said earlier, I am not practicing law, or as a CPA, nor do I know the tax laws there.

[Stan]

Please keep in mind, that I had no one from 3ABN give me any info on this, but because of a recent transaction I am involved in, I gained a lot more understanding of this.

If this is what I think it is, I would have wished someone would have explained it to your earlier.

[Stan]

ALSO that is about the only way someone can change homes, without walking away from free rent, and move into home ownership.

[Stan]

See http://www.irs.ustreas.gov/pub/irs-pdf/f8283.pdf and http://www.irs.ustreas.gov/pub/irs-pdf/i8283.pdf.

This form says it must be filled out if donations of property are more than $500. If more than $5,000, it says an appraisal must be obtained by the donor. The donee specifically must say, "This acknowledgment does not represent agreement with the claimed fair market value." Thus, it would appear, any receipt the donee gives cannot have a dollar amount on it, which, I think, is what Fran said somewhere.

And all this raises another question: Was the property 3ABN sold to Danny ever donated to 3ABN? If so, when was that? If it was sold less than 3 years after being donated to 3ABN, Form 8282 would have to be filed. Was it?

Bob

that link is for when you donated to a Charity, not from a Charity to a person. (edited after  I reread your original post, I missread form for a persons name..

[childoftheking]

So are you  saying it is corban?

Seems like some of these elderly donors should have had someone looking out for their best interests.

How did 3ABN get the property? Did they buy it at full value? If so from whom? If it was donated to 3ABN wasn't the property supposed to revert to the owner (3ABN) when those with a life tenancy were to die? Was it originally donated to 3ABN with this in mind? That should Danny and Linda pass away, the other life tenant would have use of the property during her lifetime and at her death 3ABN could then sell it and put the money into spreading the gospel? Who talked the other life tenant into giving back her life tenancy?

[Nosir Myzing]

So are you  saying it is corban?

Seems like some of these elderly donors should have had someone looking out for their best interests.

How did 3ABN get the property? Did they buy it at full value? If so from whom? If it was donated to 3ABN wasn't the property supposed to revert to the owner (3ABN) when those with a life tenancy were to die? Was it originally donated to 3ABN with this in mind? That should Danny and Linda pass away, the other life tenant would have use of the property during her lifetime and at her death 3ABN could then sell it and put the money into spreading the gospel? Who talked the other life tenant into giving back her life tenancy?

Come on now. No, it was not a sacrifice or offering made to God, and May Chung is hardly an elderly woman being taken advantage of. She is a smart an savvy business woman with a good head on her shoulders.

The Three angels broadcasting network chairman of the board explained this himself in a letter which Robert Pickle filed in court, so Mr Pickle is well aware of the explanation and people involved.

The Property transfer was overseen by an Attorney who was on the 3abn board at the time and had worked for the NAD conference writing the same kind of documents.

The property in question was a gift to 3abn, from May Chung with a life interest for herself and for Danny and Linda Shelton. In other words, the house was theirs to use as long as any of them should live.

Danny and Linda asked the board if they could purchase the remainder interest which was 3abn's and the board agreed.

The amount was determined by legal statistical tables calculated to determine the worth of the property at the statistical time of their death.


3Abn has to account for all trusts they handle or which are gifted to them, if a lifetime trust is revoked, or as in this case, the remainder interest was purchased from them, then they also have to account for the loss, as it is no longer in their possession.

Mr Pickle along with his financial advisors looked at the partial documents they had and came to the erroneous conclusion that this was an excess benefit, paid retirement, and a purchase of a property for below the market price.

The Attorneys involved, the accountants, the auditors and even the IRS who this was all properly reported to did not come to the same conclusions.

[childoftheking]

And what is her age?  Seems like I read on Blacksda about someone falling asleep. And she isn't the only older lady involved in the house swap or sales. Just sayin' ya know. Wouldn't want anyone to be accused of being greedy at the expense of our senior citizens. What benefit was there in the deal for the ladies then? These sharp business dealers. Or Whom did the deal benefit? Who thought it up? Was it for the benefit of 3ABN? Did the deal help spread the gospel? Did it glorify God? Would Jesus have done it? Remember I said elderly donors (plural).

Edited to add two lines.

[Bob Pickle]

Bob

that link is for when you donated to a Charity, not from a Charity to a person. (edited after  I reread your original post, I missread form for a persons name..

In the case of a charity giving property to a founder/director/officer for less than fair market value, that's called a section 4958 excess benefit transaction, and can get the charity and those involved in serious trouble.

It's reported on IRS Form 990.

[quaddie47]

When we spoke before,.....(edited for emphasis)

When you spoke before?  Stan are you the person Bob kept claiming he talked to about this transaction even though it was clear that when he did Bob did not have all the relevant information to present to the individual for consideration?