10 April 2024
TOPEKA (KSNT) – A federal court decision paves the way for the IRS to access the bank records of God’s Storehouse in Topeka, as the thrift shop is under investigation for campaign finance issues, unpaid employment taxes and tax evasion. The United States Court of Appeals for the Tenth Circuit denied the thrift shop’s attempt to block the IRS from accessing its bank records.
The Topeka thrift store was founded by Pennie Kloos and now-Sen. Richard Kloos (R-Topeka) in 2009. The following year Richard Kloos and two others incorporated God’s Storehouse as a not-for-profit corporation. According to court documents, God’s Storehouse didn’t apply to be tax-exempt under not-for-profit statutes but instead declared itself as a church.
The thrift store is located at 2111 SW Chelsea Dr. and recently expanded to a second location at 1707 SE 29th St.
In 2021, IRS Investigator Kesroy Henry was assigned to investigate God’s Storehouse, according to court records. Henry issued an inquiry notice to God’s Storehouse. The inquiry informed God’s Storehouse of four concerns:
it potentially operated as a thrift store instead of a church.
it may have improperly intervened in a political campaign.
a coffee shop inside the thrift shop may be liable for unrelated business income tax.
wage payments tmight incur liability for unpaid employment taxes.
A meeting with a God’s Storehouse representative failed to resolve the IRS’s concerns. As a result, the IRS informed God’s Storehouse it would move forward with an examination.
Henry requested God’s Storehouse provide documents and bank statements for the two years. God’s Storehouse objected to the request on the grounds that the request was overly broad, according to documents from the Court of Appeals.
In February 2022, the IRS issued a summons to Kaw Valley Bank for all records in God’s Storehouse’s name from 2019 and 2020. God’s Storehouse petitioned the district court to quash the summons issued to Kaw Valley Bank, according to court documents.
The appeals court upheld a judge’s earlier decision that the bank records could be made available to the IRS.
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