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SALT LAKE CITY (AP) -- A Utah man is soliciting "ministers" to sign over their assets to his church and take a vow of poverty in a "tax fraud scheme," the U.S. Justice Department alleged Tuesday.
Federal lawyers filed a civil complaint saying Kevin Hartshorn takes title to his ministers' homes and deposits their earnings in a church account, then issues debit cards for the ministers to spend the money. Authorities say federal courts have consistently rejected vows of poverty and converting property to "parsonages" as a way to avoid taxes.
The Justice Department is seeking a court injunction against Hartshorn's Orem-based operation. The complaint, filed Monday in federal court in Salt Lake City, also demands copies of his records.
Hartshorn contends he's running a legitimate religious order called the Church of Compassionate Service in compliance with tax laws.
"We just do compassionate service," Hartshorn told The Associated Press Tuesday. "We're a service organization for people who commit and organize their lives in a way to do that, just like any religious order out there. We've done everything to be compliant with the Internal Revenue Service. It's all about compassionate service."
Hartshorn didn't respond to the government's specific allegations and said he was unaware of the Justice Department complaint. The AP provided him a copy so he could provide a more complete response.
The complaint says Hartshorn hasn't paid taxes since 1986 but brags in a resume that he's a business executive who has made a lot of money.
From 1985 to 1990, Hartshorn claimed gross income of up to $1 million a month on a chain of check-cashing outlets in Washington state, according to the complaint. It says Hartshorn also claimed to have managed over 80 businesses, in financial services, real estate, furniture and electronics, restaurants and catalog sales.
The government didn't say how it obtained Hartshorn's resume. It isn't the first time Hartshorn provided tax counseling, according to the government. As early as 1983 and until 2004, he promoted a tax shelter known as the International Academy of Lymphology.
The academy advised people that by donating $5,000, they could avoid taxes by becoming "certified lymphologists" who spread a message of health, the government says.
The message was that with "deep breathing, rubbing the body, stroking the body, (and) compressing tissues," people can "get oxygen to every cell in your body so your body can heal itself."
"IAL advised customers to create LLCs so that customers could receive income and pay expenses without reporting the income to the IRS," assistant U.S. attorney Daniel Price wrote in the civil complaint.
(Copyright 2010 by The Associated Press. All Rights Reserved.)
