IRS Notice of Proposed issue

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  #61  
Old 02-04-2015, 03:42 PM
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Originally Posted by Advogado View Post
However, if the IRS does win, it should be the Developer, not Villagers, who bears the resulting cost. The question of many people like myself, who have spent some time familiarizing ourselves with this matter, is What exactly happens if the IRS does win?
And that is the $64,000 question. It's easy to have an opinion one way or other (although most do not want the IRS to prevail) when you don't have any "skin in the game", but it's a whole different story when you do!
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  #62  
Old 02-05-2015, 07:55 AM
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I too am a huge fan of the Developer in terms of the structure and operation of The Villages, and I love living here.

But I expect the Developer, and every other merchant with whom I deal, to carry out his contractual obligations to me and his other customers. Furthermore, I don't think I have seen any posts in which the contributor is cheering for the IRS to win and hurt the Developer or the Center Districts.

However, if the IRS does win, it should be the Developer, not Villagers, who bears the resulting cost. The question of many people like myself, who have spent some time familiarizing ourselves with this matter, is What exactly happens if the IRS does win?

If you have an answer to that question, I would like to see it. If we had an independent newspaper here, that question is something that their staff would have long ago analyzed and discussed in print. As it is, we have to rely on our own digging around and on the POA and its volunteers to keep us apprised via their Bulletin.
I agree. The Developer should be the one to foot the bill.
  #63  
Old 02-05-2015, 11:44 AM
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Although I attended a welcome to the Villages VCDD meeting in January, I am thinking about attending the Wednesday 8 A.M. VCDD questions and answers session this coming Wednesday as I will be down in The Villages that week.

I am still not clear on the relationship of the VCCDD to the VCDD with the use of all of the interlocal agreements. Who controls whom and by the way who controls the VCCDD? These relationships seem to have a bearing on the IRS case.

I will also ask for copies of the Exhibits or attachments to the IRS 5701 Notice of Proposed Issue which I can’t find on the VCDD web site.

The Notice of Proposed Issue by the IRS gave me an interesting historical overview of the interworking’s of the Villages. The accuracy of that view by the IRS may also have a bearing on the case.

Last edited by twoplanekid; 02-05-2015 at 04:26 PM.
  #64  
Old 02-05-2015, 01:17 PM
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Originally Posted by twoplanekid View Post
Although I attended a welcome to the Villages VCDD meeting in January, I am thinking about attending the Wednesday 8 A.M. VCDD questions and answers session this coming Wednesday as I will be down in The Villages that week.

I am still not clear on the relationship of the VCCDD to the VCDD with the use of all of the interlocal agreements. Who controls whom and by the way who controls the VCCDD? These relationships seem to have a bearing on the IRS case.

I will also ask for copies of the Exhibits or attachments to the IRS 5701 Notice of Proposed Issue which I cant find on the VCDD web site.

The Notice of Proposed Issue by the IRS gave me an interesting historical overview of the interworkings of the Villages. The accuracy of that view may also have a bearing on the case.
Please let us know what you find out.

As I recall, there are some inaccuracies in the IRS "history" of The Villages. For example, the history indicates that the gates keep nonresidents out. In fact, the roads are public and the gates are merely to slow down traffic and provide security by photographing license plates and drivers.

While I have some views on the matter, I have never spent a lot of time analyzing the respective merits of the IRS's position versus that of the Developer/Center Districts. The controversy is complicated, and our views on the merits don't really matter. What matters is the potential effect on us Villagers if the IRS sustains its position.

This is because that will be a situation where our interests are in direct conflict with those of the Developer. I.e., Somebody will have to bear the resulting costs, and who will it be? Ultimately, the costs should fall on the Developer, but it could take a protracted and costly legal battle to make that happen.

So, let's root for a Developer victory or that the IRS simply bans future use of tax-exempt financing by the Center Districts. (Although our amenity fees are currently being diverted to finance the defense of the Developer's actions, so far this diversion does not seem to have impacted the level of our amenities. Thus, I guess we cannot complain-- yet.)
  #65  
Old 02-05-2015, 02:21 PM
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When was the last time you heard that General Electric or Walmart was being audited??? They are so large the IRS has to just take their word, meanwhile "Jim-Bob's Lawn Service" is having to explain the last 3 years of his tax returns...
The IRS does not announce audits on large corporations, because they have auditors that are in almost constant contact with their Tax departments. On top of that public corporations have private auditors that are constantly monitoring what is going on. I have worked in several such corporations - believe me, the IRS is inside all the time. Not sure where you got that opinion, but it is not correct. Sounds a little like Union propaganda
  #66  
Old 02-05-2015, 02:47 PM
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The IRS does not announce audits on large corporations, because they have auditors that are in almost constant contact with their Tax departments. On top of that public corporations have private auditors that are constantly monitoring what is going on. I have worked in several such corporations - believe me, the IRS is inside all the time. Not sure where you got that opinion, but it is not correct. Sounds a little like Union propaganda
You are absolutely right. As I have pointed out, the allegations that the IRS is somehow picking on the Developer here have absolutely no factual basis. As to the incompetency of IRS in handling the investigation-- that is another matter.
  #67  
Old 03-06-2015, 06:48 PM
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There is a summary and update in the latest POA Bulletin. If you missed it, it is available at poa4us.org
  #68  
Old 03-06-2015, 07:02 PM
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For those of you who are interested in the future of the amenity system: The POA article is already outdated. Go to districtgov.org to see the VCCDD response to IRS.
  #69  
Old 03-06-2015, 07:12 PM
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For those of you who are interested in the future of the amenity system: The POA article is already outdated. Go to districtgov.org to see the VCDD response to IRS.
Just discovered that the POA article is already outdated. For those of you interested in the future of the amenity system, go to districtgov.org and click on IRS.
  #70  
Old 03-06-2015, 08:11 PM
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When the Villages attorney (our attorney) says this in his arguments, I am not sure that his position or statements are correct.
*************
Clearly, there is substantial use of the Amenities Facilities not only by residents but
also by persons who live outside the boundaries of the Center District and the numbered
residential districts. If it were important for tax purposes that nonresidents use the Amenities
Facilities for them to be treated as available to the general public (which is not a requirement in
the regulations), it is obvious that the number of non-residents who use the Amenities Facilities
is more than substantial. While it may be impossible to identify with accuracy the actual number
of people that use the Amenities Facilities each year, between golf, swimmers, exercise classes,
team sports, tournaments, clubs, and on and on and on, let's roughly say that there are maybe
20 See Rev. Rul. 98-47 (stating that making rental units in a complex available to all persons ofretirement age results
in the complex being treated as available to the general public).
21 As pointed out above, there is a turnover of approximately 5% in The Villages in each year.
B-11
500,000 or maybe 1,000,000 users of Amenities Facilities each year.22 These users of the
Amenity Facilities are the general public. Without any doubt, the Amenities Facilities are used
by the general public.
V. The Center D
****************
Is this true?
  #71  
Old 03-17-2015, 07:16 PM
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Interesting 2012 article on the Villages by BloombergBusiness that includes another view of the IRS problem.

Billionaire Morse Behind Curtain at Villages - Bloomberg Business

How accurate is it?
  #72  
Old 03-17-2015, 08:58 PM
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The article doesn't delve very deeply into the technical tax issues, but it is interesting reading and tries to provide some broad brush number crunching.
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  #73  
Old 03-18-2015, 10:06 AM
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Quote:
Originally Posted by twoplanekid View Post
When the Villages attorney (our attorney) says this in his arguments, I am not sure that his position or statements are correct.
*************
Clearly, there is substantial use of the Amenities Facilities not only by residents but
also by persons who live outside the boundaries of the Center District and the numbered
residential districts. If it were important for tax purposes that nonresidents use the Amenities
Facilities for them to be treated as available to the general public (which is not a requirement in
the regulations), it is obvious that the number of non-residents who use the Amenities Facilities
is more than substantial. While it may be impossible to identify with accuracy the actual number
of people that use the Amenities Facilities each year, between golf, swimmers, exercise classes,
team sports, tournaments, clubs, and on and on and on, let's roughly say that there are maybe
20 See Rev. Rul. 98-47 (stating that making rental units in a complex available to all persons ofretirement age results
in the complex being treated as available to the general public).
21 As pointed out above, there is a turnover of approximately 5% in The Villages in each year.
B-11
500,000 or maybe 1,000,000 users of Amenities Facilities each year.22 These users of the
Amenity Facilities are the general public. Without any doubt, the Amenities Facilities are used
by the general public.
V. The Center D
****************
Is this true?
I believe this statement relates to guests of village residents. While lawyers for both sides will be selective in the facts they present and throw them against the wall to see which ones stick, I don't believe that this (vague) statement will carry much weight considering you have to be a guest of a Village resident with a guest pass to use the facilities and local residents outside of The Villages cannot be guests. I believe that the courts will look at this as available to the general public without undue burdens or restricted access.
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