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difficultfinances (Church responds to allegations)

Church finances — a response to allegations that the Church misuses its funds


December 2019 — A former employee for the investment arm of The Church of Jesus Christ of Latter-day Saints, filed an IRS complaint last month alleging the church should be forced to pay taxes on returns made from invested tithing funds and challenging the faith’s investment strategy, humanitarian efforts and tax-exemption status.  This employee took documents from the Church finance department to allegedly back his claims.

“Claims being currently circulated are based on a narrow perspective and limited information. The church complies with all applicable law governing our donations, investments, taxes and reserves. We continue to welcome the opportunity to work with officials to address questions they may have.”

The church offered no specific comment about the complaint or Nielsen prior to the Post’s story. Instead it directed the Post and other media to past comments by church leaders about church finances. Leaders previously have said the faith provides $40 million a year to address famines, respond to natural disasters, aid refugees, give medical care and training and more through its humanitarian arm, Latter-day Saint Charities.

Latter-day Saint Charities reported in February that the figure is even larger.  The charity has provided more than $2.2 billion, or an average of $64.7 million a year, in 197 countries since its creation in 1985.

“Latter-day Saint Charities has provided more than $2 billion in aid to assist those in need throughout the world,” President Russell M. Nelson said two months ago at the church’s semiannual general conference. “This assistance is offered to recipients regardless of their church affiliation, nationality, race, sexual orientation, gender or political persuasion.”  The church also operates other charitable concerns. For example, local bishops and branch presidents — leaders of the faith’s 30,500 individual congregations around the world — help members with food, housing and other welfare needs on a daily basis.

Nonprofit groups, including religious organizations, are exempted from paying taxes on income in the United States. Ensign Peak Advisors is an integrated auxiliary and supporting organization of the church and is tax exempt.

The former employee claimed that in 2009 Ensign Peak bailed out Beneficial Financial Group, a life insurance company owned by the church’s for-profit arm, Deseret Management Corp., which also owns the Deseret News. He alleged that Ensign Peak delivered $600 million to Beneficial in 2009.  Beneficial made full disclosure to the Utah Department of Insurance that Deseret Management Corp., its owner, provided $594 million to Beneficial during the 2008 financial crisis to strengthen its balance sheet. Those public filings are on file with the Utah Department of Insurance and the payment was reported in two articles published by the Deseret News at the time.

Since 2009, Beneficial has paid dividends of almost a half billion dollars back to Deseret Management Corp., according to public filings at the Utah Department of Insurance.

The former employee also argued the church should exempt church members from paying tithing or give them a rebate because the church allegedly could cover its operations with the investment income of its reserves.  While tithing is a source of income for the church, it is regarded within the faith as much more than a financial principle. Tithing is a biblical principle practiced in many faiths with components far beyond church operations. Abraham and Jacob paid 10% of their increase to God, and Jesus Christ also taught the principle. Muslims and Christians including Latter-day Saints believe tithing is inherently important because it sanctifies the individual.  The church teaches its members to be self-reliant and build a personal or familial reserve. Its leaders say the church follows the same principles.

Presiding Bishop Gérald Caussé referred to those principles last year in a public talk and published later in a book: “The church applies this same principle in its own savings and investments. In addition to food and emergency supplies, the church also sets aside funds each year for future needs. These funds are added to church reserves, which include stocks and bonds, taxable businesses, agricultural interests and commercial and residential property. Investments can be accessed in times of hardship or to meet the emerging needs of a growing, global faith in its mission to preach the gospel to all nations and prepare for the Second Coming of Jesus Christ.”

In 2018 the church published this Q&A on church finances.

More information about the Church finances can be found at this link.

How the Church of Jesus Christ uses tithes and donations  (this is another explanation regarding the appropriate use of Church funds)

The Church The Church of Jesus Christ of Latter-day Saints uses the sacred tithes and generous donations of its members in worldwide efforts to love God and neighbor. In light of recent media stories that have misrepresented the Church’s approach, the Church provides the following summary.

The Church is committed to helping the poor and needy. Latter-day Saint Charities is a global program that primarily benefits those who are not Latter-day Saints. In times of need and during other emergencies, we partner with many global organizations like the Red Cross to provide assistance. President Russell M. Nelson spoke recently about some of these efforts. And this represents only a small portion of what the Church spends to care for those in need. The most recent annual report shows that the Church’s humanitarian arm has given more than $2.2 billion in aid in 197 countries since it was created in 1985. In addition, through the Church’s welfare program, leaders of the faith’s 30,000-plus congregations regularly help men, women and children with food, housing and other temporal needs, totaling billions more dollars in assistance.

The Church builds temples and connects families through family history. The Church is heavily focused on the doctrinal principle of connecting families across generations. This spiritual work is done in 217 announced or operating temples, an effort supported by the faith’s nonprofit family history organization, FamilySearch, which also freely offers its genealogical resources to anyone.

The Church provides worship and gathering space for its members. The Church must fund facilities, education and activity programs for its 30,500 congregations. Meetinghouses also serve as spaces for community education, family history research and emergency response.

The Church supports a global missionary program. Currently, more than 65,000 Latter-day Saint missionaries around the world are preaching the good news of Jesus Christ—an effort that requires significant financial support from the Church beyond the missionaries’ personal or family contributions. The faith’s approximately 400 missions include mission homes, apartments, offices and automobiles—all funded by the Church.

The Church invests in education. The Church believes that both secular and spiritual learning are eternal, and it invests significant financial resources in education. The Church’s Seminaries and Institutes program provides daily religious instruction to some 400,000 high school students and 300,000 university students each year. The Church provides higher education opportunities globally through its expansive PathwayConnect program, which paves the way to a university degree for those with limited opportunities or resources. And the Church operates several universities and a business college serving a combined 93,000 students.

“The fact that the Church of Jesus Christ has been able to fund the operation of meetinghouses, temples, educational institutions and missionary work—while also building up reservoirs of resources for the difficult days that eventually come—is a model that should be celebrated and emulated by governments and other institutions around the world,” one opinion editor writes.

The Church follows the same sound financial principles it teaches its membership. It avoids debt, lives within its budget and prepares for the future. Little wonder the pages of the Wall Street Journal recently praised Utah’s strong economy, in part because of the state’s “predominant [Latter-day Saint] culture that encourages out-of-fashion virtues such as thrift, delayed gratification and stable families.”

D. Michael Quinn, a scholar who published a 600-page history of Church finances in 2017, summed up his findings as “an enormously faith-promoting story.” He told a newspaper reporter that if Latter-day Saints could see “the larger picture,” they would “breathe a sigh of relief and see the Church is not a profit-making business.”

“Yes, the church saves and invests its surplus pennies,” a Deseret News op-ed concludes, “but it also helps vastly reduce the debt of college students, gives to the poor regardless of background and supports one of the largest non-governmental welfare programs in the country. Most importantly, it does all this without enriching those at the top.”

The sacred funds donated by members of The Church of Jesus Christ of Latter-day Saints are an expression of faith, devotion and obedience to the biblical law of tithing and a desire to build Christ’s Church through living the two great commandments to love God and neighbor.


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Following is an article that appeared in the Deseret News, responding to the allegations recently made regarding the financial doing of the Church.  The names of the authors of this article are listed at the bottom of the page.

Monday’s Washington Post story about the finances of The Church of Jesus Christ of Latter-day Saints has already gotten a lot of attention. We think it deserves more.  Not because the topic of church holdings is somehow new — it’s not (Time magazine once ran a cover story titled, “MORMONS, INC.”) — but because the renewed focus on the church’s extensive holdings once again proves that, well, the church actually practices what it preaches regarding provident living and self-reliance. They take seriously the biblical story about Joseph and Egypt’s seven years of plenty followed by seven years of famine.

In an age of ballooning federal deficits, massive student debt and failed pension promises, we should perhaps be a bit slower to blow whistles when an organization — once on the brink of financial ruin — actually stays out of debt and saves for a rainy day. This is especially important for a church, a common place to which people turn for help during times of economic distress.  As a nation, and especially as individuals, we would all do well to try harder to model this behavior.

Earlier this year, The Wall Street Journal ranked church-owned Brigham Young University the No. 1 school in the nation in terms of value for the price. Thanks to church assets — and specifically the financial investments highlighted by The Washington Post’s article — tuition for BYU students remains astonishingly low ($2,895 a semester for church members). Even more recently, the Journal has applauded Utah for having the best economy in the country (with a state government that runs a surplus and also saves for a rainy day). Meanwhile, researchers such as Raj Chetty have highlighted how Utah communities sustain some of the highest rates of upward mobility in the country.

Much of this success is influenced by the prudent financial and charitable principles taught (and evidently exemplified) by The Church of Jesus Christ of Latter-day Saints. Hopefully, by underscoring the church’s holdings, the Post article and the story’s whistleblower will draw some attention to an institutional model that’s actually working. The church’s financial standing — once squarely in the red only a century ago — is now, by some estimates, on par with entities such as the Bill and Melinda Gates Foundation, Harvard, the Catholic Church or the Church of England. The Post’s whistleblower puts the church’s financial holdings at $100 billion, but more substantiated financial leaks from last year put the numbers closer to $32 billion.  Hopefully underscoring the church’s holdings, the Post article and the story’s whistleblower will draw some attention to an institutional model that’s actually working.

Of course, it’s fair game to question whether the reserves are adequate or excessive, or whether specific actions with funds are proper, as the Post article and the whistleblower does. Vast assets require controls and nonprofit reserve investments can be controversial. In recent years, for instance, Congress passed a tax targeting large university reserves at institutions with at least 500 enrolled students and endowments totaling more than $500,000 per student.  For perspective, Harvard has a financial endowment nearing $41 billion, serving the higher education needs of some 20,000 students. The church, by contrast, serves 16 million members with the scope of its work often spilling beyond its own membership. The church supports international humanitarian and welfare efforts, extensive education services, food banks, addiction recovery and employment programs, family therapy and counseling services, genealogical and self-reliance initiatives, and, of course, its broad ecclesiastical functions, which include more than 30,000 congregations worldwide.

In education alone, the church runs a university system with total enrollments — both online and through four brick-and-mortar campuses — of nearly 90,000 students. And the church’s high-school-level church education program provides daily religious instruction and other services to more than 400,000 students each year. Full disclosure, one of us is a professor of Brigham Young University and benefits from the church’s support.

Though this renewed focus on church finances will undoubtedly draw attention to the more notable elements of its asset portfolio (hey, look, the church invests in a mall), it’s unlikely to change attitudes among those in its congregations who see how the money from investments and tithes funnels back to carrying out a global-sized mission. Their kids go to BYU or church seminary classes. They serve missions in foreign lands or receive financial assistance through unpaid clergy when they fall on hard times. They participate in disaster relief efforts, helping throngs of co-religionists in delivering food and other essentials.

After publishing an exhaustive 1,000-page deep dive into the church’s finances, noted historian and long-time church critic, D. Michael Quinn, characterized the sweeping narrative history of church finances as “an enormously faith-promoting story.” He said that if people understood “the larger picture” on church finances they would “see the church is not a profit-making business.” Yes, the church saves and invests its surplus pennies, but it also helps vastly reduce the debt of college students, gives to the poor regardless of background and supports one of the largest non-governmental welfare programs in the country. Most importantly, it does all this without enriching those at the top.  Before we face the next recession, our governments and other institutions of civil society would do well to follow the church’s example. Although some will call this most recent round of headlines about church finances “news,” the wisdom remains as old as Egypt.


Hal Boyd is an associate professor of family law and policy at Brigham Young University’s School of Family Life and a fellow of the Wheatley Institution. Lynn Chapman holds a doctorate in public policy from George Mason University and is an education and business consultant based in Virginia. Their views are their own.