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SPs: New Info on Getting Money Back

Auditor's Toad

Clear as Mud
"Anyone in the US know the tax implications for successfully receiving a refund for a payment made to Scientology in past years and deducted on those past years' taxes? "

Consult your CPA. I always figured if I claimed a deduction for it ( and I never did ) then should I get it back I'd have a tax liability on it.

But, hey, I'd rather take my money from people who hire PIs to houind good people and give it to stupid jerks who buy $600 commode seats and $500 hammers.
 

Zinjifar

Silver Meritorious Sponsor
I think in general, if you made a 'donation' which you got a tax break for, and you get a refund, you will have to declare the refund as income.

But, check it certainly.

Zinj
 

Auditor's Toad

Clear as Mud
" think in general, if you made a 'donation' which you got a tax break for, and you get a refund, you will have to declare the refund as income.

But, check it certainly.

Zinj "


Well, yeah, he said it in a lot better way than I did- LOL !
 

Ho Tai

Patron Meritorious
Have carried-forward charitable contributions?

It so happened that at the point I got my repayment I had a larger amount of carried-forward contributions on my tax books than the amount of the repayment. To put it another way, I had donated more than I was able to write off of my U.S. taxes, and the IRS rules allow you to carry forward such excess donations for a period of five years from the year in which the deduction was made. My tax person, who is very competent and whom I have been going to for years, said that the rules in this situation aren't 100% clear, but the IRS is very likely to just be reasonable about it and accept a simple reduction of my carried-forward amount. (Per my tax person the IRS doesn't track the carry-forward, but should the taxpayer get audited, he better have good records!)

To put this in context, say I had donated $50,000 over the past five years but because of income-based limits on deductibility (like you can only deduct up to 50% of the amount of your income), I was only able to write off $20,000. I now have $30,000 that I can deduct from future years taxable income. Say that of the $50,000 I donated, I used $40,000 in services and have $10,000 left on account. After whatever it takes to complete the repayment I get the $10,000 back from the CoS. So in my records I reduce the $30,000 that I was carrying forward by $10,000 (the amount of the repayment), and I am now left with $20,000 that I can still carry forward. Let's say that this year I have enough income so that I can write off the whole $20,000, and carry forward nothing to next year.

This is all legit and sensible. The IRS is getting its due, since in the end I will have donated $50,000 minus the $10,000 I got back, or $40,000. I have written off $40,000 in donations: $20,000 over the past five years as described above, and $20,000 this year. It's as if I had never donated the $10,000 I got back. I report nothing about the $10,000 check to the IRS, I just keep track of everything should I get audited.

BTW, I never received any sort of tax documents from CoS about the repayment amount. But I wouldn't have put it past the CoS to drop a note to the IRS about the repayment so they could keep a close eye on my tax returns for a year or two, or maybe bring me in to chat. I keep my taxes squeaky-clean, but the thought of being audited still rattles me. Paranoid, perhaps? :D
 

Auditor's Toad

Clear as Mud
"But I wouldn't have put it past the CoS to drop a note to the IRS about the repayment so they could keep a close eye on my tax returns for a year or two, or maybe bring me in to chat"

Count on the C o $ reporting every repayment / refund to the IRS.

They can't help it - it is just their nature that complels them to do shit like that.
 

ExB.S.O.

Patron
Is there anyway the church can counter your clam for refund and repayment because they say you have a free loader debt? Are staff contracts legally binding in any way. Has anyone returned books for refund?
 

Dulloldfart

Squirrel Extraordinaire
So should I go for a refund, if I have paid it? Any experiences in this?
Or I can just pat myself on the shoulder for being so stupid...

I haven't heard of anyone even asking for it back, although someone might have. My wildass guess is that they would *say* no, but if it came to came to a court case, who knows? Especially if it is under $5,000 and could be addressed in a small claims court, and we're talking preponderance of evidence here, not beyond a shadow of a doubt.

Paul
 

Sis O' Sign

Patron with Honors
Cheers Paul, I'll see what I do with it. Yes, mine was a bit lower amount.
I do a bit more research on labor rights and so on in the country where I was in the SO.
 
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