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Day 11 in the Jinwright trial

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When may churches give tax-free gifts to their pastors?

In the second half of Thursday’s testimony, Atlanta accountant Robert Howze was back on the stand. Howze (photo insert) told the court that, generally speaking, churches are prohibited from ever making tax-free gifts to their pastors.

The one exception, he said, would be in the case of a “De minimus” gifts – a Latin phrase that means trivial. Howze said a holiday turkey might quality as a De minimus gift for IRS purposes.

Just before lunch, prosecutors showed Howze a series of checks that Greater Salem had written to either Anthony or Harriet Jinwright. Written on the memo line of each check were messages such as “Merry Christmas” or “Happy Anniversary.”

“Does a check for $3,000 constitute, in your opinion, a De minimus amount that can be excluded from income?” Assistant U.S. Attorney David Brown asked of one of the checks.

“No,” Howze said.

During cross-examination, Howze told the court that “love offerings” are steeped in the history of the black church, going back to the days when small churches could ill afford to pay a visiting preacher.

“The tradition and the history has carried over to present times,” he said.

Howze said he has worked with hundreds of African American churches, and his website dubbs him "The Pastors CPA."

Howze remained on the stand until approximately 6 p.m. and was released from his subpoena. But before he concluded, he was pushed by Brown to reveal the reason why, after two years of auditing Greater Salem’s financial reports, he refused to perform that service for a third year. (Details in Friday's morning update.)

Click here to read coverage from previous days.



An Atlanta-based accountant said he twice conducted certified audits for Greater Salem City of God but declined to do a third year after the church failed to adopt financial controls recommended in the first two audits.

Robert Howze, who owns Legacy Consultants Inc., said he identified several areas in the church’s finances where compensation was not being included in the taxable incomes for pastors Anthony and Harriet Jinwright.

Howze said his audits in 2003 and 2004 also found that church resources were being spent in ways that did not benefit the Greater Salem ministry and that the church had a checking account that was being used for “non-ministry expenses.” His testimony did not reveal how that account was used.

Howze said he outlined with the church’s board of directors and with senior pastor Anthony Jinwright some of the issues his audit uncovered. He said he did not recall speaking directly to co-pastor Harriet Jinwright but said she may have been in one of his meetings with directors.

“I explained the difference between reportable compensation and gifts,” he said. “…I made the statement, ‘Churches can’t give gifts.’”

A federal prosecutor spent much of Thursday morning questioning Howze about the IRS treatment of so-called “love offerings.” He told jurors that the IRS does not recognize the term and that he advised Anthony Jinwright and Greater Salem directors that such gifts should be included in the pastor’s taxable income.

But under cross-examination by one of Harriet Jinwright’s lawyers, Howze, who said he serves as chief financial officer at his Atlanta church, conceded that members of his own congregation also make love offerings to their pastor. He said the donations are given in a special envelope notifying donors that the gifts are not tax-deductible. He said the gifts also are given directly to the minister, not funneled through a church account.

He did not testify directly about whether his church or its pastor includes that money in the pastor’s taxable income.

Also today, prosecutors presented evidence showing that Greater Salem, when it applied for tax-exempt status starting in 2002, listed income for Anthony Jinwright that was substantially lower than the amount listed on the Jinwrights' tax returns. In the case of Harriet Jinwright, the church document stated that she received no income, while the couple’s tax return showed that Greater Salem paid her more than $128,000.

The church document was signed by Anthony Jinwright.

Prosecutors suggested that Greater Salem may have given the lower numbers because the IRS had rejected an earlier church application for tax-exempt status over concerns that, among other things, Anthony Jinwright’s compensation was unreasonably high for a church the size of Greater Salem.

Click here to read coverage from previous days.



The federal government will call new witnesses today in the fraud and tax-evasion case against Anthony and Harriet Jinwright, co-pastors of Greater Salem City of God.

Prosecutors told Judge Frank Whitney Wednesday that they would not wrap up their case today as planned. With three to four more witnesses to call, they say, the government’s case will likely stretch into Monday.

In afternoon testimony, Terry Lancaster, the Jinwrights' tax preparer from 2001 to 2006, continued his testimony.

Lancaster told the jury that each year he files tax returns for 50 to 80 ministers. Prosecutors showed him documents indicating that the Jinwrights, between 2001 and 2007, claimed tax deductions totaling $100,798 for robes and laundry. They asked Lancaster how that total compared with what other pastors were spending.

“It seemed high,” he said.

The jury also heard testimony that, within a month after Greater Salem’s former finance administrator, Nelson Adesegha, was fired after he refused to write a vacation check for Anthony Jinwright, the senior pastor did resume receiving vacation pay.

In November 2005, Anthony Jinwright received an $8,000 check with the words “vacation 1” written in the memo line, according to evidence presented to the jury. A month later he received another $8,000 check for “vacation 2.” Two months later, in February 2006, he received a third check, this one for $16,000 and labeled “vacation weeks 3 and 4, 2005.” And three months after that, in May 2006, he received another $16,000 check, this one labeled “final vacation payment for 2005.”

Lancaster said the Jinwrights never told him about those checks when he prepared their tax returns.

“We would have included it as income,” he told the jury.

In cross-examination Wednesday, defense attorney Ed Hinson questioned Lancaster about whether amended tax returns credited to the Jinwrights were authentic, noting that the address used was a post office box, not an address the couple normally used on their tax returns.

Lancaster conceded that the address was different and that the signature also appeared different. But in redirect, prosecutors produced a check, apparently written on the Jinwrights’ personal bank account, that appeared to be payment for preparing the amended returns.

Click here to read coverage from previous days.

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October 7, 2015
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