Wednesday, May 06, 2015

Peter J. Reilly: The Trials of Kent Hovind: An American Tragedy

Peter J. Reilly, who has written previously in Forbes on the saga of Kent Hovind, writes that he is, yet again, facing trial:
Kent Hovind is facing another trial in the federal court in Pensacola on May 18th. In 2006 Hovind was convicted on a 58 count indictment - interfering with the administration of the Internal Revenue laws, failure to pay payroll taxes on the employees, or as he refers to them “missionaries”, working for Creation Science Evangelism and structuring, the systematic withdrawal of cash in amounts somewhat less than $10,000 in order to avoid currency reporting requirements.  Hovind was sentenced to ten years in prison, three years of supervised release and forfeiture of over $400,000 in structured funds.
Reilly has championed the idea that Hovind is the victim of prosecutorial overreach and has highlighted that here and here.  Having said that, he appears to be no supporter of Hovind, himself. As he notes:
Kent Hovind adamantly maintains that he is not a “tax protester”.  I have some issues with that.  If you go to the flagship website of his supporters #FreeKent you can follow the links to Proof Number one “Letters from professionals absolve Kent Hovind from all wrong-doing“.   The first letter is from Kent to one of the professionals and starts with:

“I am writing to request your professional opinion regarding the voluntary nature of Form 1040.”

The responses are something of potpourri of tax protester arguments, that have been ruled by courts to be frivolous.  As Hovindicators often correctly point out Kent Hovind was not convicted of tax evasions, so the letters, which were clearly meant to set up what is called  a Cheek defense, really have little to do with what he was convicted of.
Along the way, he peppers the story with videos detailing exactly what Hovind believes (some of which is out there even by creationist standards), involving conspiracy theories.  Nonetheless:
The Hovindicators are right that the treatment of Kent Hovind has been harsh, particularly this second set of charges.  What is most troubling is that a conventionally tax compliant Kent Hovind would not have had to pay a lot of taxes.  If Creation Science Evangelism had applied for 501(c)(3) status the support that the ministry could have been plowed into the real estate with no income taxation.  As an ordained minister Kent could have taken a modest salary and a large tax-free housing allowance from CSE.  Instead, when he finally gets out he faces an income tax deficiency of over $3,000,000.
Of course, the reason that Kent’s sentence on the first conviction is harsher than that of most people who are initially convicted of tax-related crimes, is, in part, his continued insistence that he has not broken any laws.  Many cases are settled by pleas and there is credit given in the sentencing guidelines for “acceptance of responsibility”.  And of course, he believes that 501(c)(3) status is a trap for churches.
Read the whole thing.  It is an interesting expose of how tax law is sometimes prosecuted.

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