IRS Audits 23 Television Ministries : Could Jeopardize Tax Exemption of Some Televangelists

The Internal Revenue Service is auditing the finances of 23 television ministries and expects the probe could jeopardize the federal tax exemption of some evangelists.

“The service is continuing to devote significant examination resources to media evangelist cases,” Robert I. Brauer, assistant IRS commissioner in charge of exempt organizations, said in a letter to Rep. J. J. Pickle (D-Tex.), chairman of the House Ways and Means oversight subcommittee. Pickle released the report today.

Because of privacy laws, the report did not mention the ministries by name. Identifying them only by number, Brauer outlined key issues against the 23, most of which are suspected of not fully reporting their income, engaging in political activities, or allowing their earnings to benefit officials of the ministry.

The IRS stepped up its examination of TV ministries after the well-publicized sex-and-bribery scandal at the PTL organization headed by Jim Bakker.

‘Move to Final Stages’

PTL, which apparently is ministry No. 15 in the report, is in bankruptcy court, where the IRS is pressing claims that Bakker and his associates failed to pay tax on unrelated business income, such as from rental of PTL’s satellite network; failed to report some income, and used PTL contributions for their own enrichment, including acceptance of salaries that the IRS contends were excessive.

Brauer said he expects several of the TV ministry cases “will move to the final stages of the examination process this year.”

“We also anticipate that some of these cases will present serious issues relating to continued federal income tax exemption,” Brauer said.

Brauer’s cover letter said two organizations connected with former Republican presidential candidate Pat Robertson have refused to provide records of the type that other TV ministries have provided voluntarily.

Because the Freedom Council and the National Freedom Institute would not cooperate, the letter stated, the IRS had to go to federal court in Norfolk, Va., to seek to enforce a summons for the records.

“The degree of cooperation received by the service varies from case to case and, in one case involving a prominent evangelist, the service has reached agreement on federal tax issues for the years 1980 through 1983, including payment of substantial federal income tax, interest and penalties,” Brauer wrote.

Here are some highlights of the report, which was current through Dec. 31:

--Ministry No. 1 was engaged in a life style that led the IRS to believe that some income was not reported. Acting on an informant’s tip, the Criminal Investigation Division prepared a case that has been referred to a federal grand jury.

--No. 4: IRS agents are reviewing content of TV broadcasts to determine whether they were primarily political.

--No. 8: A team of auditors and a computer specialist are investigating allegations of political activities, lobbying and personal enrichment from ministry funds.

--No. 16: The IRS has completed review of the books and records for this ministry for 1984 through 1986. The chief issue is whether tax-deductible contributions to the ministry flowed to the benefit of the founder and his family.