IRS Whistleblowers Revisited

Photo by adil113. CC BY 2.0

Has it really been nearly a year and three months since Lars Nielson released his brother’s whistleblower complaint against the church? What felt like the story that would dominate news of Mormonism in 2020 was quickly buried by Trumpian scandals and then worldwide pandemics.

Like most people, I’ve only thought about the $100 billion endowment fleetingly over the last year or so; I’ve been more wrapped up in translating my job to my home, helping my kids become at-home students, and playing the saxophone.

Monday, though, a court decision came across my desk that made me think of Ensign Peak Advisors and Lars Nielson. See, one reason his brother filed a complaint with the IRS was in hopes of getting a whistleblower award. Statutorily, whistleblowers are entitled to receive between 15 and 30% of the amount the IRS collects as a result of their complaint.

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Options for Financial Transparency

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In today’s Deseret News, Boyd and Chapman then acknowledge:

Of course, it’s fair game to question whether the reserves are adequate or excessive, or whether specific actions with funds are proper, as the Post article and the whistleblower does.  Vast assets require controls and nonprofit reserve investments can be controversial.

I agree wholeheartedly: let’s start asking questions about Church finances.  But first, we need Church financial disclosures. [Read more…]

Some Thoughts About Ensign Peak Advisers and the Church

The Religion Unplugged and Washington Post stories raise (at least) three important questions. I’m going to try to address all three here (though at least one will be really quick), and I suspect that this post will be unsatisfying both to those who want to see the church vindicated and those who want to see it get its comeuppance. And that’s because, contrary to popular perception, the tax law isn’t an area full of clear answers and bright lines. It’s also because many tax issues are fact-dependent, and we lack many of the facts. To the extent that you want more information and analysis, Peggy Fletcher Stack has been doing some great reporting on this.

The three main issues I see are these:

  1. Does the church have $100 billion in securities-type investments?
  2. Should the church have $100 billion in securities-type investments?
  3. Does the $100 billion in investments violate the tax law?

Now, I have absolutely no answer to number 1. I’m slightly skeptical, just because growing $12 billion in 1997 to $100 billion today (with two significant market downturns happening in those 22 years) strikes me as requiring some pretty aggressive assumptions. On the other hand, it’s at least plausible. And notably, the church has the ability to tell us how much it’s worth. To the extent it chooses not to do so, assertions like this will continue to find traction. Since the ball’s in the church’s court here, and since I have neither knowledge of nor the ability to find out the net asset value of the church’s investments on my own, for purposes of this post, I’m going to assume that he’s right, and that the church has $100 billion invested in Ensign Peak Advisers.

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