Feds say Orem church promotes tax fraud

SALT LAKE CITY — An Orem man faces a federal lawsuit for running a church that authorities say is used to promote tax fraud.

The U.S. Attorney's Office for Utah filed a civil complaint against Kevin Hartshorn, asking a court to stop him from operating the Church of Compassionate Service. "In promoting this fraudulent tax scheme, Hartshorn falsely promises customers that they can reduce or eliminate their federal income taxes, refuse to file federal income tax returns, and legally put their income and assets beyond the reach of the IRS."

According to the lawsuit, church members become "ministers" who take a vow of poverty and therefore are exempt from paying income taxes. Any money they earn is turned over the church as "fruit" used to "further the mission of the order." The church provides debit cards to its ministers for their day-to-day expenses, such as food, utilities, rents/mortgages, vehicle expenses and entertainment.

"The ministers' vows of poverty are patently false, because after taking these vows, the wages or income earned by ministers, which were formerly deposited into their personal bank accounts, are simply deposited into church bank accounts and disbursed on the ministers' demand for their living expenses in exactly the same fashion as the ministers had disbursed funds out of their personal bank accounts prior to the vows of poverty," the complaint states.

The church requires members to live in their homes and claim them as "parsonages" as a way to avoid paying income tax. It also prohibits members from speaking to any governmental authority.

Hartshorn, identified as the church's "senior minister," previously ran a similar scheme known as the International Academy of Lymphology and has not filed a federal tax return since 1986, according to the lawsuit. Some members of the Church of Compassionate Service, including Hartshorn, left the academy in 2004 due to the "apostasy" of one of the co-founders in conducting its affairs.

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