Chart: Deceitful Theology Part 5

Diagram of 501(c)(3) Tax Fraud

We have been considering Pastor Douglas Wilson’s doctrine of “lying to the enemies of God who have forfeited their right to the truth.” More specifically, I’ve been providing examples of Doug Wilson’s proclivity to tell lies, other than those we’ve documented in the Public Deceit category.

To understand today’s example of deception, the reader must understand section 501(c)(3) of the Internal Revenue Code, which controls a church’s tax-exempt standing before the IRS. However, in explaining this I must paint with a broad brush and limit my scope because Internal Revenue Code can be complex, as most Americans know.

Section 501(c)(3) of the Internal Revenue Code addresses the tax-exempt status of charitable organizations, which includes Christian churches. Up front, I’ve always explained section 501(c)(3) in terms of a public trust. The IRS entrusts churches with tax exemption on the assumption that churches use their tax-free funds for the improvement of society. To ensure this goal, the IRS prohibits those persons responsible for overseeing the tax-exempt revenue from skimming cash. They can’t pinch the money that the IRS entrusted them to use for the common good. They must maintain a firewall between their personal interest and that of the trust. This is the difference between “profit” and “nonprofit.” Those who run for-profit enterprises can dip the till all day long — but they must pay tax on their income. However, those who run nonprofit organizations cannot use the organization’s tax-exempt proceeds for what the IRS calls “private inurement” or “private benefit,” because the trust does not exist for the good of those who manage it. Thus the IRS:

Inurement/Private Benefit — Charitable Organizations
A section 501(c)(3) organization must not be organized or operated for the benefit of private interests, such as the creator or the creator’s family, shareholders of the organization, other designated individuals, or persons controlled directly or indirectly by such private interests. No part of the net earnings of a section 501(c)(3) organization may inure to the benefit of any private shareholder or individual. A private shareholder or individual is a person having a personal and private interest in the activities of the organization. (IRS)

So how a church distributes its funds determines its standing before the IRS. The amount of money involved is irrelevant; how that money is handled is not, which brings us to Christ Church in Moscow, Idaho. Pastor Douglas Wilson of Christ Church in Moscow, Idaho, helped found Canon Press as a so-called “ministry” of the church, but its mission changed. Canon Press became a front to funnel money to Douglas Wilson, “a person having a personal and private interest in the activities of the organization.” By 1999 Canon Press’ annual gross sales topped over one-million dollars ($1,000,000); no one knows how much Mr. Wilson nicked from the proceeds. In 2012 Christ Church sold Canon Press to Doug Wilson’s son, N.D. Wilson — “the creator’s family” — which ended the charade. How often do churches sell their so-called nonprofit ministries, let alone sell them to the pastor’s son?

The following chart demonstrates how Doug Wilson used Canon Press’ 501(c)(3) tax exemption for his personal benefit (click it to enlarge). Presumably he reckoned the federal government an enemy of God “who have forfeited their right to the truth,” which therefore conferred on him the right to violate Internal Revenue Code.

 

Diagram of 501(c)(3) Tax Fraud

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