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Scientologists Admit Church Paid IRS for Tax-Exempt Status



From the Salt Lake Tribune, 1/3/98

Now, the headline gives the impression that the Co$ paid $12.5 mil to
get their tax exempt status.  Way to go, guys!  Now Utah thinks that
Co$ paid for their tax exemption.


Scientologists Admit Church Paid IRS for Tax-Exempt Status

THE ASSOCIATED PRESS

    LOS ANGELES -- The
Church of Scientology paid the Internal Revenue Service $12.5 million
to establish its tax-exempt status four years ago, a church official
said Tuesday. 

    Mark Rathbun, director of the church's Religious Technology
Center, confirmed some previously undisclosed details of the 1993
settlement reported in Tuesday's edition of The Wall Street Journal. 

    The settlement, known as a closure agreement, ended a struggle
that began in 1967, when the IRS argued that the main Scientology
church should lose its tax-exempt status because it was a for-profit
business that enriched church officials. 

    The church replied with more than 2,000 lawsuits against the IRS.
Rathbun said ``rogue agents'' made ``outrageous claims'' against the
church and it had to fight back. 

    IRS spokesman Frank Keith said the decision to grant tax-exempt
status was ``based upon voluminous information provided by the church
to the IRS regarding its financial and other operations.'' 

    Under the agreement, the Church of Scientology agreed to drop its
lawsuits and pay $12.5 million to settle any tax assessments prior to
1993. 
 
   However, further payments are possible. 
   
 The church also agreed to set up a tax-compliance committee to
monitor its adherence to the settlement and to the tax laws. Under the
agreement, the IRS can levy as much as $50 million in penalties on the
church if it finds that officials are enriching themselves with money
intended for nonprofit activities. 
    

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