The real reason for the new donation arrangement?

by redvip2000 18 Replies latest watchtower scandals

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  redvip2000

  Yesterday i was having a beer with a friend of mine who happens to be an accountant, and we began discussing this ridiculous arrangement that the Watchtower has put in place. After giving him the backstory of how the Watchtower has been lending money to the local congregations and charging interest, he simply could not believe they had been doing that.

  He then offered an explanation which really made sense to me. He said that in reality what the Watchtower society has been doing is actually not legal in light of their Tax-exempt status. What is usually called Section 501(c)(3).

  To maintain tax exempt status an organization must maintain a clean record in six major areas. One of the areas is what is called Unrelated Business Income.This income comes from a regularly-carried-on trade or business that is not substantially related to the organization’s exempt purpose.

  Now, the organization tax exempt purpose is evangelizing. But loaning money for real estate which is to be paid back with interest, is outside of the scope of the purpose outlined in their tax exempt application. An organization that produces unrelated business income as a result of its unrelated trade or business may have to pay taxes on that income.

  He told me that the IRS does it's rounds on this issue via audits, and that every year over 100 organizations lose their tax exempt status because of stepping over the boundaries what type of income they fail to pay taxes on.

  I don't know if this is what is really behind this new move by the Org, but this made a lot of sense to me. It's quite possible that the IRS probed or at least showed interest during the past year on how the organization was handling these loans,which made the Org to preemptively switch all monies under the "donation umbrella", in order to continue to not pay taxes and safeguard it's tax-exempt status.

  I know this is just conjecture, but it could well be an explanation for it.
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  sir82

  after giving him the backstory of how the Watchtower has been lending money to the local congregations and charging interest

  The Society stopped charging interest on loans like 8 or 9 years ago.
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  redvip2000

  The Society stopped charging interest on loans like 8 or 9 years ago.

  I could be wrong, but i believe interest-free loans were only for congregations who committed themselves to pay it fully under X amount of time. (whatever X was)
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  DesirousOfChange

  How about if the loan was interest free by the property title was never received?

  Doc
• 

  eyeuse2badub

  Your friend is spot on. The only reason for the "all donation" arrangement is to avoid having audits from the IRS. It's a preemptive move by the WTBTS so that the IRS will not start looking into their finances and accounting. Smart business but not motivated by the love of the gb.

  All the bull they spewed out about such "a loving arrangement by the gb" is a smoke screen to garner praise from the rank and file but the real reason has to do with BUSINESS.

  The WTBTS is financed by contributions or donations that come mostly from congregations, right? Then they used to "LOAN" the money to those self same congregations, with interest, to build or remodel KH's. The congregations, in turn, would then repay the "LOAN" to the WTBTS" and when the "LOAN was repaid in full, guess who owned the KH?

  It was a BUSINESS deal not "a loving provision". Even when they stopped "charging" interest, it was still a BUSINESS deal because there was a "LOAN" and a repayment plan/agreement.

  Same reason Rutherford had to have JW's become a bona fide "RELIGION' back in the 30"s. So the dubs could maintain their "tax exempt" status.

  just saying!

  eyeuse2badub
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  insidetheKH

  the WTBTS did not charge interest on the loans in none of their 239 countries and territories. Furthermore this arrangement is implemented in 239 countries and not in the US only so it has nothing to do with the IRS or US tax exempt status. If that was the case they would only change arrangements in the US.

  anyway this is one of the best arrangements the WTBTS did come up with.

  Before this new arrangement my congregation was donating about 125 dollars every month for Kingdom Hall fund but from now on this will be U$1145 dollars. And the other congregation in our Kingdom Hall will donate even more every single month U$1370
• 

  Magnum

  insidetheKH: this is one of the best arrangements the WTBTS did come up with

  You never explained that statement. You simply indicated that some congregations are donating more to the org now. So in what way is that better? Better for whom? Better in what way?
• 

  oppostate

  At our last Serv Mtg it was announced that we had two resolutions to make.

  1. Due to the slips turned in the congregation will be giving $1,200 p.mo. to the Building Committee for upkeep of the KH.

  2. The congregation resolves to donate $850 p.mo. to the Kingdom Hall Building Fund.

  They both passed almost unanimously. (... With only myself and two others I saw abstaining).

  That's a monthly total of $2,050. (The other Cong. that shares the KH is making a similarly expensive resolution).

  In the past the local contribution to the Building Committee was $1,475 p.mo. and always less than $100 for the KHBF.

  There were quite a few months where the Cong. came up short last year.

  How the heck do the elders think the publishers will really live up to contributing even more this coming service year?

  Oh, and good-bye to the $14, 000 saved-up reserve in the Building Committee bank account as well.
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  insidetheKH

  @Magnum better for the WTBTS they got a enormous pile of instant cash and are assured of a steady monthly income of extra millions.
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  Ocean1111

  In addition to their multi-billion dollar global liquidation project over the last few years, they are going to milk the congregations of maybe another billion is cash. The purpose is just that, Bethel liquidation, the writing on the wall cannot get any clearer now.

  They do these kinds of things shortly before the controlled corporate implosion process. Now JWs have no actual world HQ, and the congregational cushions will also be depleted, in time JWs will also loose their "Kingdom halls" to this operation as the Bethel derivative exposure tentacles spread out to the congregations of all the land.

  Bethel is being swept away, by internal coup it appears. It really is just finishing the job they started in 1976.