IRS Audit Finds SCA Owes $1.345 Million In Back Taxes for ‘07
Sun City Anthem (SCA) Board President Jack Troia, CPA, announced during the February 10th SCA Board Meeting that the IRS Revenue Agent had found the Sun City Anthem Community Association, Inc. guilty of violating tax laws and owing $1.345 Million in back federal income taxes for 2007.
He also stated that the IRS had not yet reviewed the previous or subsequent tax years. So, the total amounts owed to the IRS could wind up being significantly more than $1.345 Million.
This appears to be the first IRS corporate audit of a Nevada HOA. The major area of error appeared to be where the SCA boards had overcharged annual member assessments and (1) failed to refund the surplus to members, and (2) failed to pay income taxes on the retained surpluses.
The IRS finding means that Sun City Anthem homeowners may wind up paying twice for the board’s and tax preparer’s mistakes:
(1) for the excessive annual assessments not refunded or credited to future assessments as required by law, and
(2) for the board having to pay the high corporate income taxes on monies that should have been given back to members.
SCA Board Presidents responsible for the 2007-2008 year income tax returns were Mike Dixon and Roz Berman. Roz Berman was also the 2007 Treasurer. SCA Tax Preparer for the past decade has been Mr.Gary Lein. Association attorney for the past decade was Mr. John Leach. Mr. Ed Song has also provide legal services to SCA after joining Leach’s firm in 2008.
Current Board President/CPA Jack Troia was the SCA Finance Committee’s expert on tax matters in 2007 and 2008.
The serious problems with the SCA Income Tax returns was initially reported on in early 2008 by Anthem VOICE founder and 2008 board candidate, retired CA Senator John V. Briggs. Board President Mike Dixon and Treasurer Roz Berman summarily rejected all of the well-researched facts presented to them at that time.
See this link for some details.
http://www.anthemvoice.org/taxes_issue.html
See this link for some more history:
http://blog.anthemvoice.org/2008/04/01/dixon-fails-to-answer-key-question/
Unfortunately, it is clear that IF the SCA directors in 2007, 2008, 2009 and 2010 had paid attention to the facts presented to them, our community could have easily avoided the $1.345 Million tax bill for 2007, and the years since then.
We have some serious questions to ask of the Del Webb/Pulte-appointed auditor and attorney who have guided the association along this disastrous path. It appears we have not been well-served by them.
And, SCA members may be considering demanding restitution of the lost funds through a class-action suit against the responsible individuals.
One Response to “IRS Audit Finds SCA Owes $1.345 Million In Back Taxes for ‘07”
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February 13, 2011 at 15:19
I HAVE TWO SERIOUS QUESTIONS TO ASK;
1. ) WHY DIDN’T THE BOARD LISTEN WHEN THEY WERE INFORMED BY SENATOR JOHN BRIGGS THAT THEY WERE ACCUMULATING A “SLUSH FUND” THAT MIGHT BE SUBJECT TO AN INCOME TAX AUDIT? —- AND
2. ) NOW THAT THEY HAVE EXPOSED THIER BLUNDER, ARE WE GOING TO BE ALLOWED TO VOTE ON WHETHER OR NOT TO SPEND EVEN MORE OF OUR OWN MONEY TO APPEAL?