How Much Have We Spent Appealing The IRS Audit Result?

 

 

In the course of the community debate over the Board’s decision to fight the Internal Revenue Service assessment related to Sun City Anthem’s 2007 tax return, a large part of the argument has been that SCA is spending vast sums on the matter.

We have been told that the Association has hired the nation’s foremost HOA accounting expert and the nation’s foremost HOA tax attorney to advise SCA on the case.

So how much has it cost SCA so far to appeal the IRS decision?

$50,000?

$40,000?

$25,000?

$10,000?

Well, the answer was given by Mike Carey, the Board’s Assistant Treasurer, during his financial review at today’s (Feb. 23) Board meeting.

The amount?

$3,900.

This amount is the combined total of the retainers paid to both of the hired experts, and those retainer amounts have not yet been exhausted.

We’re talking about a cost of 55 cents per home so far, in order to fight an assessment of more than $1.3 million.

When practicing cost-benefits analysis, one must weigh the cost of doing something vs. the benefits that might be obtained.

So far, at least, looking at it on a cost-benefits basis, the potential reward would seem to vastly outweigh the cost.

Will SCA need to spend more than this amount to bring the IRS matter to conclusion? Probably.

But we have been told that the Association has now entered the personal negotiation phase with the IRS, and a resolution that does not require a Tax Court appeal might not cost a lot more.

Time will tell.

Comments

[Joel Berg]

Nothing like FACTS to shame those who spread rumors and ignorance!

[alan]

maybe if getting the facts were not like pulling teath from the board there would not be rumors and ignorance! they need to get a little more free with their info, that is unless they just like to see discourse in the community!

[David Berman]

Alan, much of the time I find that getting the facts is not so much a function of the Board being uncommunicative as it is an unawareness or unwillingness on the part of residents to look at the information the Board makes available to us.

This Board, for example, does a much better job of putting all the information from the Board Book, the same information the Board sees pursuant to its meetings, online at the community website. But when you see so few members attending meetings -about 30 attendees last night- and so few accessing the available information, it becomes more a case of us not availing ourselves of the information that is out there.

By the way, you might want to check the definition of "discourse." I have a feeling that is not the word you meant to use, as "discourse" actually has positive connotations.

[Sherryl Daly]

Well David, as surely as the sun rises in the east and sets in the west, Dick Arendt has written a "blistering" attack on this article. For emphasis, he uses gross, crude and infantile photos and clipart, which tells you all you need to know about Arendt & Friends. Not once is Bob Frank's name mentioned.

Arendt suggests you pay the $3900 since you seem to feel -- as would any sane resident -- that on a cost-benefits basis, the expenditure is supported by the math.

I see nothing offensive in your article which is, once again, factual, informative and entertaining, as is your style. For those of us who couldn't get to the 6:00 PM Board meeting and who want information, not MISinformation and incivility, thank you for this writeup.

[David Berman]

Sherryl, are you really suggesting that Arendt's pledge of courtesy and civility, and sticking to the issues, has been violated?

How can that be?

Is this the same Richard Arendt who has written on perhaps a dozen occasions that, from that moment forth, he would be ignoring me?

Is this the same Richard Arendt who almost never attends meetings and then speculates on what went on there?

Is this the same Richard Arendt whose fuzzy math leads him to insist that his forum is on the ascendancy while mine is a failing venture?

If the answer to the last question is yes,then I guess I should be thanking him for the free publicity.

[carl Weinstein]

Behind Arendt's nice smile and curley red hair is the temperment of a nest of red army ants crawling through the desert and destroying everything they come in contact with. Arendt has already violated his pledge of decency. Instead of actually calling people names he has switched to using nasty photographs to depict his feelings. He has every right to disagree with how the Board handles the IRS issue BUT all he has to do is state the disagreement and explain WHY he disagrees. Instead he has made it another personal attack issue. I am ashamed that he "duped me" at one time into thinking he was a decent guy!

[RoseAnn Hill]

David, you bring up a valid issue about resident attendance at the Board meetings, which can equally be applied to other organizational meetings.

There are many residents that travel considerably, or live here part-time. When away, these people are unable to attend meetings. But, that does not mean they are not involved, interested, or invested in the outcome of such meetings. Furthermore, there are residents who are home-bound, or for a variety of reasons, are unable to attend meetings. (For instance, the Board meetings often conflict with CH99 meetings.)

This is one reason I continue to urge review by the community to allow CH99 to video and use our bandwidth to allow all in our community access to these meetings.

Issue #2

One could put forth, with respect to Board Candidacy requirements, that by excluding those who don't attend meetings, etc., that you form an exclusive group of those who do, and only they should be candidates. When in fact, those who maintain multiple homes, travel frequently, etc., may in fact have been much more corporately successful (thus having the funds available) and would then be better candidates for the Board.

Every individual in this community has the right to put him/herself up for candidacy. They should be judged on the merits of their capacity to put forth logical and legitimate arguments on their policy positions.

We as individuals access those arguments and qualities, we make the decision about what we feel best fits our personal perspective.

I'm not saying that volunteerism isn't important, I think there's so much more to the issue than volunteerism.

Issue #3 - Civility

Both your blog and Anthem Today Forum have slipped down that slippery slope away from civility. Comments have come from those who contribute that are equally off-target. It really is a waste of time to point fingers back and forth about who's said the most mean thing. There's no doubt in my mind that both sites have done their share.

It is more useful for us to discuss facts, and in the case of the Stebbins/Frank issue, can we not let this rest? When the courts make their determination it will be ended. Meanwhile, it seems to be a rock inbeded in the foot pad of the shoe! GET RID OF IT.

As far as Mr. Frank's potential conflict of interest, I think mentioning it is enough. We all know. We can determine for ourselves whether this is a critical factor. We don't need an instruction set about how that all works. ENOUGH.

Issue #4
Lastly, I tried to find the information on the Public Record for the Municipal Court that you referenced, and I'll be damned if I could find any link that worked. I'm not a novice on finding things either, but this one sure tripped me up. Please, when you say that one can easily get the information, how about giving out the link too -- you do that for lots of stuff. It would have helped me!

Thanks for the opportunity to speak up.

[David Berman]

RoseAnn: I'd like to address some of the points you make, but I think your comment belongs under the "What Makes A Good Board Member" topic rather than this one about the IRS audit.

Do you mind if I move your comment?