MinistryWatch.com questions Goad's claim of tax-deductibility

goads_singning.jpg (8955 bytes)A site visitor sent me the link to http://www.ministrywatch.com.  On their page is a link to a .pdf page questioning the Goad's "non-profit" status of some of their companies.  The Goads are a family of three brothers and a sister who regularly perform (music) at various Amway/Quixtar line of affiliaton functions.  The Goads also claim to run tax exempt charities. 

IRS Says Gifts to Goad Not Tax-Deductible and Goad Not Talking
by Rodney Pitzer

What is Goad?

• "Goad" appears to be a $50+ million, Orlando based organization, consisting of at least 4 separate entities, (1) Goad Ministries, (2) Outrageous Productions (for-profit), (3) The Goad Foundation, (4) Giving Hope (church).

• The name of the organization is based on the Goad family, which comprises three brothers and their sister who currently lead the ministry efforts.

• The Goad’s travel across America and the world performing musical concerts as a family.

• In addition, Goad claims to "help children and families who need and deserve our assistance" and where "over 90% of resources given goes toward those in need."

The Issues

• MinistryWatch.com has information from the IRS indicating that Goad is not tax-exempt nor are donations tax deductible.

• Goad is asking for donations and representing that those donations are tax deductible, which is apparently incorrect from information from the IRS.

• Goad is not willing to address with MinistryWatch.com the issues or provide any understanding.
• If Goad is indeed a tax-exempt entity with the IRS, it has a legal responsibility to comply with the public disclosure requirements and make available its annual financial report (the IRS form 990).

• It is unclear how the four Goad entities are governed and who they are accountable to.

• How is compensation, royalties and other expenses determined and accounted for?

• It is evident from past IRS filings that:

• Richard Goad has received salaries from at least 3 of the entities and benefits
• Timothy Goad has received salaries from at least 3 of the entities and benefits
• Curtis Goad has received salaries from at least 2 of the entities and benefits
• Carolyn Goad has received salaries from at least 2 of the entities and benefits

• All four of the Goad’s were recipients of loans from Goad Ministries. Loans to ministry personnel can be a red flag, especially concerning non-independent boards, not knowing the reason for the loans, and the repayment terms.

The Pursuit to Understand

• MinistryWatch.com contacted Goad by email, letter, fax, telephone, and a personal visit, beginning 5/14/2002 and

Goad has rebuffed all efforts to engage in a meaningful dialog.

• A representative of MinistryWatch.com visited the Goad office on March 29, 2005 and was not able to talk with anyone besides the receptionist. When asked if Goad is a church the receptionist said "no" that it is not. When asked about donations being tax deductible, the receptionist referred the inquiry to the Goad website. The Goad website does indicate that it is indeed "a registered, 501(c)(3) non-profit organization. All tax deductible gifts will be properly recorded and receipted in compliance with IRS regulations."

• Goad representative Trish Davis was contacted by telephone on Friday, April 8, 2005 and she confirmed that they have received the various communications from our office but they have no intention to answer any of the questions.

Initial Issue Concerning Goad

The Internal Revenue Service (IRS) says Goad is no longer tax-exempt and gifts are not tax deductible.

Evidence

• Goad has multiple solicitations for donations, including for "Tsunami victims" and to become a "monthly donor" and become what they call an "Ambassador of Hope."

• Goad states on their website that they are "a registered, 501(c)(3) non-profit organization. All tax deductible gifts will be properly recorded and receipted in compliance with IRS regulations.

Goad International and subsidiaries subjects itself to an annual independent audit and an annual IRS compliance audit."

• Goad claims that "over 90% of resources given goes toward those in need."

• Multiple Entities:

"Goad Ministries": Last known IRS form 990 was for 1999 and is indicated as a "final return." Goad does not provide schedules or attachments as required by the form and as such does not indicate where the $3 million in net assets went. Total Revenue was $31 million.

"Outrageous Productions, Inc.": For-profit organization related to Goad Ministries.

"The Goad Foundation": Last known IRS form 990 was for 2002. It only indicates $1,500 in revenue and $3,000 in net assets.

"Giving Hope": Guidestar.com indicates this entity as a church with address at 1715 W High St, Piqua, OH 45356. Goad’s website indicates this as a sub-ministry in Orlando, FL.

Questions for Goad

MinistryWatch.com desires a dialog to understand Goad’s situation, including:

• How can Goad reconcile that the IRS says that the organization is not tax-exempt and donations are not tax deductible, but they state the opposite on their website (at least as of April 11, 2005)?

• How is the "ministry" organized?

• Is Goad a for-profit business, or a Para-church ministry?

• MinistryWatch.com requests in its understanding of the situation to be sent the three most recent IRS form 990s and Audited Financial Statements for Goad. In addition, we would also like any other descriptive information they may be willing to provide.

MinistryWatch.com Recommendation

• Donors as good stewards of what the Lord has given them should look elsewhere to give. Without access to comprehensive ministry information it is not possible for donors to make optimal giving decisions. It is important for donors to make an assessment of giving options and make discerning giving decisions.

• Donors should consult with their tax advisors if they have or are expecting to receive an IRS tax deduction from Goad.

• MinistryWatch.com desires all ministries to be open and transparent and continues to have a desire to dialog with Goad when they are ready. MinistryWatch.com will always have an open door policy to communicate and understand.

goads_non_profit.JPG (95819 bytes)

Hi Scott,

Thank you contacting us and inquiring about the facts.

The online IRS Publication 78 that is referenced, when researched lists three "Goad" organizations:

  • "Goad Fam Foundation" (Brentwood, TN)
  • "Goad Foundation" (Birmingham, MI)
  • "Goad Foundation" (Orlando, FL)
  •  
  • The first two organizations as far as I can see are not related to the same Goad family in Florida (Goad Family Foundation, EIN: 62-6402695, should file a 990-PF but is not because it is too small or they are "nonfilers") (The Goad Foundation, EIN: 38-1678220, files a 990-PF) .  Information can also be gleaned at www.guidestar.com and then search for the organizations in question, or put in their EIN number.

    The Goad Foundation
    The third organization mentioned in the online IRS Publication 78, The Goad Foundation (EIN: 31-1695746) is related and is relevant, but only a very small piece of the puzzle.  This organization seems to have been first formed in 2001 (at least when they filed their first IRS form with the IRS); however, in 2002  its total revenue was only $1,517.  This organization is not operating as the multi-million dollar operation known as Goad Ministries or Goad International.  There is some important information on this form that lead to other clues to a bigger operation.  Line 80 (and corresponding schedules) indicate that this organization ("through common membership, governing bodies, trustees, officers, etc.") is related to a for-profit organization "Outrageous Productions" and tax-exempt entity "Giving Hope."  It also indicates on Statement 6 that Richard J. Goad received compensation of $91,483 from Giving Hope and $44,000 from Outrageous Productions.  In addition, Timothy L. Goad received compensation of $93,271 from Giving Hope and $44,000 from Outrageous Productions.

    Goad Ministries
    The Goad family seems to have relied upon "Goad Ministries" (EIN: 51-0161217) as its vehicle in the past as the tax-exempt entity to give donors tax deductible gifts.  As of 1999, it had about $31 million in total revenue.  As of 1998, salaries were: (1) Curtis R. Goad, $90,445 + $13,531, and undisclosed amount from Outrageous Productions, (2) Timothy Goad, $76,747 + 8,877 and undisclosed amount from Outrageous Productions, (3) Richard Goad, $90,490 + $8,342 and undisclosed amount from Outrageous Productions, (4) Carolyn Goad, $90,944 + 7,788 and undisclosed amount from Outrageous Productions.  However, Goad Ministries (EIN: 51-0161217) is no longer tax-exempt.  The tax-exempt status can be verified with the IRS by calling their Cincinnati, OH Tax-Exempt customer service number at 1-877-829-5500 and ask them about "Goad Ministries" with the EIN number of 51-0161217.

    Giving Hope
    Giving Hope is recognized by the IRS as tax-exempt and as a "church."  At least as of 4/5/2005 it was listed with Guidstar.org with an address of 1715 W. High St., Piqua, OH 45356.  Since then, the Goads have updated the address to reflect the Orlando address.  In addition, its EIN number is 74-2901402.  The first two digits of an EIN number indicate where it was first issued.  The EIN number "74" indicates it was first issued in Austin, TX.  I have not had a need to research exhaustively, but I pass the information along to you if it may be a lead to research further.  This is all very odd for a church.  Most people consider a "church" as the traditional congregational meaning and is associated with a somewhat stationary location.  In this case, the "church" is another piece of the puzzle of the multiple organizational Goad enterprise that follows them wherever they go.  In addition, if "Goad International" is the operating name for the church, is this not misleading to others that are enticed to give to an "International" operation supposedly giving to "Tsunami Victims"?  Either way, the set-up is misleading.

    Questions / Misleading Information / Hiding the Truth

  • Has the the Goad family operated a tax-exempt entity?  Yes, they have operated at least three (1) Goad Ministries (EIN: 51-0161217) now determined by the IRS to not be tax-exempt, (2) Giving Hope (EIN: 74-2901402) a "church" at least that follows the Goad family in structure wherever they move, (3) Goad Foundation (EIN; 31-1695746) that is a relatively small organization.  It is worth noting that none of these organizations are titled "Goad International."  Additionally, it is also worth noting that the for-profit organization "Outrageous Productions" is intertwined with all the Goad enterprises also.    
  • Why the multiple organizational structure for the Goad family?  Historically, at least three nonprofits and one for-profit.
  • Seems to be a very poor board structure.  Where is any independent board?  Besides multiple salaries being determined by the Goad family, what about the royalties being paid out?  
  • On the Goad website, they indicate: "Goad International is a registered, 501(c)(3) non-profit organization."  The specific name "Goad International" is not an official name recognized by the IRS. http://www.goadintl.org/outreaches/beapart.html
  • Goad website, "Goad International and subsidiaries subjects itself to an annual independent audit and an annual IRS compliance audit."  There is no such thing as an "annual IRS compliance audit."  There are very few audits the IRS performs within the tax-exempt community (past statistics indicate less than 1% of tax-exempt entities).  If Goad made a mistake in how they stated this, do they then mean an annual IRS form 990?  If this is the case, they are violating the law by not providing a copy.  In addition, if Goad has audited financial statements, why doe it not freely provide them to the public?  The Financial Accounting Standards Board states for non-for-profit organizations: "The primary purpose of financial statements is to provide relevant information to meet the common interests of donors"... http://www.fasb.org/pdf/fas117.pdf (FASB 117).  
  • The Goad website further states:  "Through planning and careful stewardship we are proud that: Over 90% of resources given goes toward those in need." Without additional information it is not possible to know if this statement is true.
  • On the front page of the Goad website they indicate "DONATE NOW - Tsunami victims"; however, when you click on the link it goes to a donate page with a default drop down box as "General Fund".  It is possible to switch to two other donation designations (1) Harold Hatchett Memorial Fund, and (2) International Disaster Relief Fund".  Even if a donor has the presence to change the default button, there is no designation of "Tsunami victims".  This whole fundraising appeal is set-up in a very poor manner at best and is misleading and blatantly wrong at worst.  http://www.goadintl.org
  • What is fundementally unfortunate is that Goad is not willing to help clear the air and to be straight forward with information.  I would recommend donors to look elsewhere to give.

    Please let me know if I can help you further on Goad information or anything else.

    Take care, 

    Rodney L. Pitzer
    Director of Research
    Wall Watchers

    back to the home page