- 14 -
Perhaps anticipating this, Roark tries to distinguish his
case from Addis’s by stating--correctly--that Addis admitted that
she expected the charity in her case to pay the premiums. Addis
118 T.C. at 535. Roark, in contrast, testified that he had no
idea what was going on with NCF and the charitable split-dollar
life insurance plan, and that every time he got information about
it, he simply turned it all over to Pippenger.
We do not find this disavowal credible. The idea for this
deal, after all, came from Pippenger--his financial, not his
charitable, adviser. Roark had to have realized that the
intricacy of the plan, plus the fact that it was being marketed
so extensively by American Express, suggested that as a practical
matter NCF would of course use money it got under such plans to
pay for insurance and not just add to its endowment. Failure to
do so would have been a massive denial of its donors’
expectations, as NCF itself recognized when it let loose with its
letterwriting surge after Congress began considering the excise
tax on premiums.
We also find that NCF’s payment of the premiums was
something of value to Roark. Of the policy’s $2.2 million death
benefit, a maximum of only $489,000 would go to NCF. The Trust,
which was set up by Roark and whose beneficiaries were his wife
and children, would receive the other $1.711 million. The Trust
would thus take 78 percent of the total death benefit, while NCF
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