Court Permanently Bars Missouri CPA from Promoting Charitable Remainder Annuity Trust Tax Scheme

On May 3, the U.S. District Court for the Western District of Missouri permanently barred Aric Elliot Schreiner and his company, Columbia CPA Group LLC, from organizing, promoting, selling or marketing tax schemes involving the use of charitable remainder annuity trusts (CRATs). In addition, the court ordered Schreiner to disgorge ill-gotten gains from the scheme totaling $400,000. Schreiner and Columbia CPA Group agreed to the court orders.

In February 2022, the United States sued Schreiner, Columbia CPA Group and five other defendants to stop them from promoting the CRAT scheme. The court previously entered permanent injunctions against the other five defendants by their consent. 

According to the United States’ amended complaint, Schreiner and Columbia CPA Group allegedly promoted the CRAT scheme in concert with other defendants. The government alleges that Schreiner falsely claimed to customers following the CRAT scheme that they could avoid reporting to the IRS and paying federal income tax on the sale of property by: (1) transferring it to a CRAT; (2) unlawfully inflating (stepping-up) the cost basis in the property on tax documents; (3) selling the property and using the sale proceeds to purchase an annuity; and (4) receiving payments from the annuity, but failing to report the annuity payments as income on tax forms. According to the amended complaint, Schreiner also prepared tax forms to implement the CRAT scheme.

Charitable remainder trusts are irrevocable trusts that let you donate assets to charity and draw annual income for life or a specific period. When all applicable laws, regulations and rules are followed, charitable remainder trusts can offer many benefits, but they must not be misused to evade taxes or illegally benefit their beneficiaries. The Justice Department is committed to supporting the IRS as appropriate in its efforts examine charitable remainder trusts to ensure they correctly report trust income and distributions to beneficiaries, file all required tax documents and follow all applicable tax laws and rules.

In addition to being enjoined from promoting their CRAT scheme, Schreiner and Columbia CPA Group agreed to be barred from organizing, promoting, marking or selling other tax schemes including conservation easements and monetized installment sales.

Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.

Abusive arrangements using CRATs and monetized installment sales, as well as syndicated conservation easements, remain a concern of the IRS, which recently warned taxpayers about them as part of the IRS’s 2024 Dirty Dozen series. The IRS has more information on charitable remainder trusts available on its website.

In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of tax return preparer and tax fraud promoters. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.