The U.S. Department of Justice is seeking to permanently stop the founder of the Christian seminar Life Surge from “abusive” real estate deals, which allegedly led to huge, unexpected tax bills for the sellers.
The lawsuit was filed by the DOJ in August in a U.S. district court in Tampa, Florida. It claims that Life Surge founder Joe Johnson and two of his associates could be responsible for up to $46 million in “tax harm” caused by 99 transactions since 2014.
The DOJ is seeking a permanent injunction against Johnson and two appraisers — brothers Christopher and Andrew Bryant. Christopher Bryant voluntarily consented to the injunction Dec. 1 without admitting allegations in the complaint.
The transactions, known as bargain sales, occurred through two organizations founded by Johnson: the now-defunct nonprofit Mercy Foundation Group and the for-profit The Welfont Companies.
Life Surge is not mentioned in the lawsuit. The traveling seminar features Christian celebrities, such as pastor and author Craig Groeschel and former football star Tim Tebow, sharing inspirational messages between less-advertised pitches for wealth-building programs, including real estate.
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Many attendees have described Life Surge as a “bait and switch,” and others previously told The Roys Report (TRR) that the seminar used manipulative tactics to sell them on expensive products they couldn’t afford.
The lawsuit states that Mercy and Welfont sought out distressed property owners and offered to help them complete a bargain sale.
In a bargain sale, a tax-exempt organization purchases a property for less than its fair market value, and the seller claims a tax deduction for the difference.
However, Johnson, through his selected appraisers, presented sellers with inflated property values, the complaint states. Often, they would work with the tax-exempt buyer to quickly resell the property at a price “far less” than the inflated value.
IRS audits revealed the inflation and left the initial sellers on the hook for the related difference in taxes. On average, sellers lost more than $504,000, the complaint states.
In addition, Johnson’s company would often provide financing to the tax-exempt organization for the purchase at interest rates well above market, according to the complaint.
An attorney representing Johnson did not respond to a request for comment as of time of publication. In a legal response to the complaint, Johnson denied the allegations and requested a jury trial.
Life Surge refused to provide a statement to TRR about the case unless TRR agreed – before seeing it – to link to the statement in its entirety. TRR typically provides links to full statements but does not agree to publish material without first seeing it.
However, Life Surge provided written answers to questions about the case to ChurchLeaders.
In that response, Life Surge stated that the federal government is targeting Johnson for his beliefs.
“Not only has the IRS been found liable for unfairly targeting conservatives, they had to pay out damages and issue public apologies for this practice,” Life Surge stated.
“As an outspoken Christian conservative entrepreneur, the IRS has unsuccessfully targeted Johnson for years. Johnson doesn’t see this as just an easy case to win as he has already done with other cases, but an opportunity to stand up against the schemes of the IRS and expose their abusive tactics.”
Life Surge also stated that the organization is “confident Johnson will prevail.”
“This case is not seeking financial compensation but simply seeking to stop activity that doesn’t even exist, which is why it will be easy to get it dismissed,” the statement reads.
Life Surge has repeatedly claimed that previous lawsuits against Johnson and Welfont have nothing to do with the seminar. Johnson left Welfont in 2019, but Life Surge President Shawn Marcell was listed on Welfont’s website as its president earlier this year. The Welfont website had been taken offline by June 4.
Marcell is not named in the DOJ lawsuit.
Ann Marie Shambaugh has reported as a print journalist in multiple states, including currently in Carmel, Indiana.
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2 Responses
“IRS audits revealed the inflation and left the initial sellers on the hook for the related difference in taxes. On average, sellers lost more than $504,000, the complaint states.”
That’s a very high number to be simply the additional tax liability on a median real estate transfer. As presented, the situation sounds like the sellers were party to attempted tax fraud.
“IRS audits revealed the inflation and left the initial sellers on the hook for the related difference in taxes. On average, sellers lost more than $504,000, the complaint states.”
They’re not named here but every single individual on the LifeSurge page ought to be looked at… Tim Tebow, Craig Groeschel, Duck Dynasty, Michael Jr, Christine Caine, Crowder, Tomlin, Brandon Lake, etc. The idea that *none* of them were aware of any of this while they all hang out and put on these events together is very unlikely.