S/O church tax status

[Tanaqui]

 

Yes, and all of the members of the church, including the pastor (whose parishioners already paid taxes on the money), pay taxes to make the road.  So they should be double taxed? Plus many of us in the church are business owners like my husband and they pay their business taxes as well.

 

It's not a "double tax", no more than paying business taxes is a "double tax". All other not-for-profits have to show that they're operating under strict guidelines. Why should religious groups be exempt?

 

You asked what money they get, I gave an example of a real benefit.

 

You do realize maintenance funds are almost exclusively from the gas taxes, and those buses buy gas at Chevron just like everyone else, right?

 

Okay. If the church burns down, the publicly funded firefighters put it out. When they clean their trash cans, the publicly funded sanitation workers pick up the garbage.

[Guest]

Nope. We pay for trash bins, the monthly fee pays for the service. Isn't like that everywhere?

 

And on the fire thing - we pay fire service. Again. Isn't it like that everywhere? Our area has very low taxes, so services are paid additionally, and sewer, phone, electric, waste removal, snow removal, etc etc, we all pay for as church members, with tithe.

 

This is an honest question - you'd really remove tax exempt status from all non profits because they might receive service in a catastrophe? I mean, if someone burned down or bombed the opposition party's headquarters here I'm not going to demand they cough up money for medical and emergency services because they didn't pay a fee through bill or tax. That just seems weirdly petty.

[MotherGoose]

It's not a "double tax", no more than paying business taxes is a "double tax". All other not-for-profits have to show that they're operating under strict guidelines. Why should religious groups be exempt?

 

You asked what money they get, I gave an example of a real benefit.

 

 

Okay. If the church burns down, the publicly funded firefighters put it out. When they clean their trash cans, the publicly funded sanitation workers pick up the garbage.

As do they for any tax exempt non-profits. You could say that most nonprofits discriminate in some way: the National organization for women, for example, is by definition going to be helping out women and not men.

[EmseB]

You asked what money they get, I

Okay. If the church burns down, the publicly funded firefighters put it out. When they clean their trash cans, the publicly funded sanitation workers pick up the garbage.

Churches do pay bills. Our church pays for garbage service, etc just like every other organization in town.

[SparrowsNest]

nm 

 

[Brenda in FL]

Why should churches have carte blanche tax exempt status? Surely not all or even the majority of their income is used for charitable purposes?

 

IF they were to lose that status, I count it as a win for taxpayers everywhere. I don't see it happening because they are protected, but it wouldn't be terrible if it did.

They don't have carte blanche tax exempt status. Any unrelated business income is subject to taxation. Just like the example earlier of the church that owns rental property. I would also think that church's running cafeterias and coffee houses also owe tax on that income, unless they have some fool-proof rationalization as to how that service further's the mission of the church.

[Tanaqui]

 

Nope. We pay for trash bins, the monthly fee pays for the service. Isn't like that everywhere?

 

And on the fire thing - we pay fire service. Again. Isn't it like that everywhere? Our area has very low taxes, so services are paid additionally, and sewer, phone, electric, waste removal, snow removal, etc etc, we all pay for as church members, with tithe.

 

Nope. Where I am, this is all covered by taxes. That's the way it's supposed to be in a civilized society, because we all benefit from these services and we all should be covered by them, regardless of individual ability to pay.

 

(Sorry, not all the things you listed. All the things I listed originally. We do pay for our phone and electric services, and theoretically for sewer services although you'll never get turned off because you don't pay.)

This is an honest question - you'd really remove tax exempt status from all non profits because they might receive service in a catastrophe? I mean, if someone burned down or bombed the opposition party's headquarters here I'm not going to demand they cough up money for medical and emergency services because they didn't pay a fee through bill or tax. That just seems weirdly petty.

 

No. Non-profits that aren't churches (and the equivalent from other religions) don't get tax-exempt status just because. They have to fill out paperwork, and show that they are benefiting whatever-it-is they're supposed to be for, and show that their salaries are not ginormous, and so on.

 

I'd be perfectly happy if churches followed the same rules as other not-for-profits instead of having special benefits that nobody else is entitled to.

 

Heck, I'd be plenty pleased if they at least followed the few rules they're supposed to be subject to, such as not engaging in partisan politics.

 

 

 

[marbel]

Nope. Where I am, this is all covered by taxes. That's the way it's supposed to be in a civilized society, because we all benefit from these services and we all should be covered by them, regardless of individual ability to pay.

 

I have lived in places where trash pickup was covered by taxes, and some where it was fee-based to the homeowner.  Both are places I would consider civilized.  They just operate differently.

 

Where I live now, the fire service is 100% volunteer. I imagine they get some taxpayer money, but they also rely on donations to operate.  And, they have no salaries or benefits to pay.   They will come to my house even if I never donate (though I do).

[PIE!]

I think churches absolutely should lose tax exempt status. They don't work for the state, they don't represent the state, and so shouldn't be funded by the state. They work for the community according to subjective beliefs, including who should get help and what that help should be. Society should be pooling resources together (taxes) to help society based on reasons supported by evidence, not faith based claims, no strings attached, no sales pitch. The religious community wouldn't be prevented from helping society as they think best, they just wouldn't have public funds to do so.

 

 

When you donate to you diaconal fund, you contribute to services that exclude LGBT citizens in your community because faith based claims are acceptable. The state should not operate on claims accepted as true because of personal faith, and are held accountable to the public in a way a church does not have to be (indeed, cannot be). My taxes shouldn't be helping to support your diocese so the money your church collects from parishioners can be set aside for legal services (ie, priests and lobbyists for protecting religious discrimination). Your church should be collecting the money it needs to operate, and if wants to serve the public (and be aided through tax exemption), it should serve the entire public, not apply some kind of "tough love" philosophy in order to manipulate non parishioners' behaviors. 

 

Forgive my ignorance, but how is being tax exempt the same as being funded by taxes? This is an honest question. Though I often disagree with your posts, I admit you always seem to use facts as the base of your opinion. I am not aware of the government funding churches. I thought they were funded by donations that were not taxed. If I have misunderstood how tax law works, I would like to understand it better. Do you have sources to show that tax exempt = funded by taxes?

[Audrey]

 

 

 

No. Non-profits that aren't churches (and the equivalent from other religions) don't get tax-exempt status just because. They have to fill out paperwork, and show that they are benefiting whatever-it-is they're supposed to be for, and show that their salaries are not ginormous, and so on.

 

I'd be perfectly happy if churches followed the same rules as other not-for-profits instead of having special benefits that nobody else is entitled to.

 

Heck, I'd be plenty pleased if they at least followed the few rules they're supposed to be subject to, such as not engaging in partisan politics.

 

 

 

This is how non-profit statuses work here.  I hesitated to say anything because I am in a different country.  My understanding is that non-profit status does not necessarily mean an organization WILL pay taxes, but that they are subject to filing and MAY have to pay taxes depending on their financial activities.  It works similarly to an individual filing.  Every individual taking income must file, but not all must pay taxes.  Those who do not meet certain thresholds pay nothing or little, while others with higher post-deduction earnings will pay more. 

 

There is, of course, a different structure for non-profits and for corporations than for individuals, but the principle is the same -- that any entity earning income must file and be subject to remittance based on income and the tax structure applicable.

 

I simply do not see a logical and valid reason why churches should not also be subject to the same standards as any other non-profit organization.  Churches truly earning little or no income will not be paying more taxes.  Churches earning a great deal of income should have to pay taxes to the greater community and country.   Religion should not make one exempt from anything. Period.

[Aelwydd]

Your plan inevitably leads to totalitarianism, with its inevitably horrifying results.

Um, no it doesn't. Sweden, maybe. Or Finland.

 

Totalitarian regimes don't use resources to eliminate disparity. They use them to enhance inequalities, to shore up the authoritarian top-down structure.

[shinyhappypeople]

So... is removing tax exempt status from churches a real thing people are actively trying to make happen or is it just wishful thinking on the part of a few?

[Guest]

It's been a real thing for years. I think I first heard about it a good eleven or twelve years ago. But this sort of ruling is what activists were waiting for to make it a reality.

 

If it turns out to be nothing but wishful thinking in another decade I'll be thrilled :). I'd love to be wrong on this.

[ChocolateReignRemix]

It's been a real thing for years. I think I first heard about it a good eleven or twelve years ago. But this sort of ruling is what everyone was waiting for to make it a reality.

If by "real thing" you mean something that a handful of people have tossed around as an idea but has never been introduced as serious legislation, then yes.

And the recent ruling would have absolutely no impact on determining tax exempt status for churches. None.

[Guest]

The reason the ones I'm thinking of were waiting for a ruling like this would be to repeal tax exempt status on the basis of protected class and anti-discrimination laws. This ruling would make that easier, but it didn't impact it as much as it could have. Unfortunately it messed with some other areas of law I'd rather it have not touched.

 

The churches I attend won't change a thing, whether exempt status is removed or not, but it is still an issue and something I wouldn't say is a baseless worry.

 

But like I said, I'd love to be wrong. Time will tell.

[ChocolateReignRemix]

The reason the ones I'm thinking of were waiting for a ruling like this would be to repeal tax exempt status on the basis of protected class and anti-discrimination laws. This ruling would make that easier, but it didn't impact it as much as it could have. Unfortunately it messed with some other areas of law I'd rather it have not touched.

 

The churches I attend won't change a thing, whether exempt status is removed or not, but it is still an issue and something I wouldn't say is a baseless worry.

 

But like I said, I'd love to be wrong. Time will tell.

No, it wouldn't. Churches are already exempt from anti-discrimination laws. This ruling has no impact on that. None.

Have you noticed how churches can refuse to allow female clergy?

Gender is a protected class under federal law. Yet churches have not lost tax exempt status for discriminating against women. Why? Because churches have the right under the 1st Amendment to operate under their religious beliefs.

 

There is no precedent to claim that this ruling can effect the tax exempt status of churches.

[ChocolateReignRemix]

Proof that the "churches will be forced to go against their beliefs" argument has no basis in reality:

 

https://www.louisville.com/content/interracial-couple-banned-gulnare-freewill-baptist-church-kentucky-news

 

 

[Audrey]

It's been a real thing for years. I think I first heard about it a good eleven or twelve years ago. But this sort of ruling is what activists were waiting for to make it a reality.

 

If it turns out to be nothing but wishful thinking in another decade I'll be thrilled :). I'd love to be wrong on this.

 

 

I have never heard any legitimate tax reform activists or experts argue for removal of tax exempt status for religious organizations based on any kind of discriminatory regulations.  The argument is almost strictly based on the fact that religious organizations are non-profits and should be tax liable just as any other non-profit organization -- meaning that they must fully disclose their financial information and file taxes just like any other non-profit with payment equitably subject to the same regulations as any other non-profit -- which means that they might or might not pay any tax depending on their financial status. 

 

It's an appeal for equality in tax burden.  Religious organizations have an unfair and unreasonable exemption where no other non-profits do. 

[Audrey]

No, it wouldn't. Churches are already exempt from anti-discrimination laws. This ruling has no impact on that. None.

Have you noticed how churches can refuse to allow female clergy?

Gender is a protected class under federal law. Yet churches have not lost tax exempt status for discriminating against women. Why? Because churches have the right under the 1st Amendment to operate under their religious beliefs.

 

There is no precedent to claim that this ruling can effect the tax exempt status of churches.

 

 

I would think the legitimate appeal for tax equality would be the logical route to ending tax exempt status for churches.   Not that arguing tax reform is ever easy, but it certainly makes it harder if you insist on using illogical and irrelevant arguments based on who doesn't like who.

 

But, I think some people are going to grasp at whatever pieces of falling sky they can to prove whatever their point seems to be.

[Laura Corin]

Society should be pooling resources together (taxes) to help society based on reasons supported by evidence, not faith based claims, no strings attached, no sales pitch. The religious community wouldn't be prevented from helping society as they think best, they just wouldn't have public funds to do so.

 

 

Your plan inevitably leads to totalitarianism, with its inevitably horrifying results.

 

Oh save me from totalitarianism in Scotland!  But hang on, I do seem to recall voting in a referendum and a general (national) election within the last year.  

 

Yes, there are religious charities here, but most people are really, really glad to pay taxes to support health and welfare.

[Bluegoat]

A non-profit business is still a business.  They are subject to different tax laws, but not tax exempt (here, at least). 

 

But we don't, unlike the US, usually tax gifts or prize money.  If a bunch of people give you money, you probably aren't going to pay taxes on it. 

 

I have a hard time conceptualizing most churches as business at all though - they aren't really exchanging goods and services.

[Bluegoat]

Putting aside the matter of whether or not churches should be tax-exempt, there are rules they're supposed to follow in order to maintain their tax-exempt status. In particular, they're not supposed to get involved in partisan politics. (All this means is that they can't endorse this candidate or that candidate. They can still do things like tell their congregants that abortion or gay marriage or whatever is wrong.)

 

Churches routinely get away with violating that rule, and in a big way, but even when it's brought to the attention of the IRS, they completely ignore it.

 

Can you imagine the IRS ignoring you if you broke the rules? Yeah, me either.

 

I think this is one of those things it is a little difficult to police. 

 

Those kinds of rules exist for a good reason I think - they are meant to prevent churches being used as a back-door way to fund political campaigns and candidates, which is a serious danger in a democracy.

 

But the US has already rather let the horse out of the barn on that one, so I'm not sure that what happens in churches is actually all that significant compared to the millions of dollars that go through other partisan channels. 

[Bluegoat]

Every church I have ever belonged to in Canada does file a tax return.

 

There are probably churches, like other kinds of charities, that abuse their tax status.  But if I look at my church, I would have a very hard time figuring out what we do that is not an important part of the fabric of our whole community.  I could say the same of the other parishes around us as well, they are all powerful forces in the community.

 

Speaking generally, churches and organizations like them are IMO pretty fundamental ways to organize people at the community level that contribute to the well being of the community.  This isn't just important because they "provide services" but because it places the power directly in the hands of the communities themselves.  Personally I would think that is equally true of a community garden or a community sports facility or food co-op.  I think tax burdens on those kinds of organizations should be minimal in general because this is one of the most important ways for people to form strong communities and advocate for their own well-being.  I would much prefer that as tax exempt than, say, political party related groups.

[Bluegoat]

I disagree with albeto, but I can't let this comment stand.

 

Name one totalitarian state in western Europe.

 

I think she was probably thinking about eastern Europe.  Which has used some interesting strategies to suppress grass-roots types of organizations, including religion, in order to shore up the power of the state which is, supposedly, maintaining a kind of equality for all. 

 

In western Europe a lot of churches not only don't pay taxes, they are funded through taxes.

[Laura Corin]

 

In western Europe a lot of churches not only don't pay taxes, they are funded through taxes.

 

Really?  Where?  

[Jane in NC]

I think what bothers many people is the idea of anyone earning a sky high salary from any sort of non-profit--church or any 501©(3). Remember the hubbub over the salary of the head of the Red Cross?  Most ministers/priests/rabbis are not receiving ridiculous compensation.  Someone mentioned tele-evangelists.  They seem to be in another category entirely from your average minister.

 

By the way, non-profits do file tax returns.  I file a 990-N for a small organization with which I am involved. This is a postcard form that tells the IRS who we are and that our total receipts are under $50K.  Far more detailed information is supplied when organizations have income above that level.

 

The tricky thing is that the law requires churches to avoid lobbying.  I was once at a service after which a woman was handing out "voting guides" which were one sided claptrap brochures.  The minister saw what she was doing and quickly had to ask her to cease the distribution on church property.  Religious organizations have every right to discuss public policy. But when "discussions" become "influence" (lobbying) there can be a fine line.

 

http://www.irs.gov/pub/irs-pdf/p1828.pdf

[livetoread]

Really? Where?

Germany, Sweden, Finland, Switzerland, and several others. Most of these countries assess a tax on church members and then pass the tax to the church.

[regentrude]

Really?  Where?  

 

The poster may refer to the weird situation in Germany. There is a so called "church tax", which is only paid by members of the church, but is collected via the general tax agencies (basically the German equivalent of the IRS).

So, it may look as if churches are "tax funded", but they are not actually funded by taxes from the general public; the IRS is merely used as the tool to collect that money from the church members. Every registered church member is required to pay this tax, which is a certain percentage of a person's income tax, and paid on top of the regular income tax. The only way to get out of it is to formally leave the church.

So, calling it "tax funded" is a bit misleading, unless it is clarified that this tax is collected solely from members of the church.

 

ETA: There are all kinds of issues with this model, but that is off topic. Just wanted to clarify the funding situation. I do not know the specifics of other West European countries.

2nd ETA: There are important constitutional differences between Germany and the US. There is freedom of religion, but no complete separation of church and state.

 

 

 

[Guest]

I think this is one of those things it is a little difficult to police.

 

Those kinds of rules exist for a good reason I think - they are meant to prevent churches being used as a back-door way to fund political campaigns and candidates, which is a serious danger in a democracy.

 

But the US has already rather let the horse out of the barn on that one, so I'm not sure that what happens in churches is actually all that significant compared to the millions of dollars that go through other partisan channels.

This varies by state and there are individual weirdnesses depending on the locality, but of the churches I deal with around here the only ones who got involved politically had candidates speaking from every major party on the ballot - everyone listed who wasn't a write in was invited, and got to answer questions and give a little stump speech. It was only the two biggest churches in the area who did that (ours eschews politics altogether, even when it directly affects them and they probably should get involved!) and they were very careful to have an open forum. No endorsements were given by the church in any way, shape, or form, unless you count the church listing their biggest policy issues and asking opinions from the candidates as an endorsement.

 

I haven't personally seen abuse of these laws in all the campaigns I've been involved in. I have heard of some issues in some specific denominations down south, but it practice it's been a non issue. Money for candidates is strictly controlled, too, and no church can donate. You'd better believe that is policed very tightly. The penalties aren't levied against the church but the candidate, to prevent them from *accepting* the funds even if they are offered. This was found to work much better than trying to police the churches, because the candidates are expected to know what donations and amounts they can and cannot accept, depending on whether it is a state or federal race.

 

Heck, we just got a letter a few days ago for a race that had concluded eight months prior, and the legislative term was completely over. The campaign finance commission wanted clarification on a legitimate charge that didn't have enough data they liked. It was borderline harassment but the statute of limitations on their ability to request clarification and information wasn't enforced. So we had to dig up and explain, again, the nature of the charge and the amount. Perfectly legal, even with the missing data, but they're jerks out to cause headaches for everyone and do so with great delight. Nothing gets missed or excused, because candidates can scour the financial disclosures of their opponents looking for violations. Since they're each trying to get a leg up on each other it's like the perfect system. Ugh.

 

/boots on the ground experience

[mommaduck]

Germany, Sweden, Finland, Switzerland, and several others. Most of these countries assess a tax on church members and then pass the tax to the church.

 

But only state recognised churches, I believe. You can't just go start your own church and expect such. Just adding for clarification. I'm a bit more read up on Finland than the others though. I could ask one of my cousins or friends there for any specifics necessary.

[ErinE]

If you are not involved in a religious community (whatever the religion), it can be easy to see only the people gathering at certain times to listen to speeches. There is much, much more that religious organizations do.

 

I live in a very poor state, with many receiving government assistance. It still doesn't help with the financial, medical, and housing gaps. Our interfaith community has multiple resources to immediately help those in need. No waiting period, no questions other than identification (to mitigate abuse). In every town and city I've lived in, there has been an interfaith organization serving the needs of the community.

 

Why shouldn't we tax the Free Masons? The Lions Club? Sons of the American Revolution? The Junior League? Those are all non-profit entities that don't serve much purpose (from outsiders) other than a gathering place for like-minded people.

 

I don't think we should tax these entities, because all these organizations serve a community purpose. Just because churches are a gathering for a religious community doesn't mean they aren't serving the community at large.

[albeto.]

No, last I checked it just prevented then money being doubly taxed. That income is taxed when it is mine, from pay checks, before it ever hits the church. There are also upper limits on charitable deductions which we regularly exceed. It goes into the church budget, we divvy it up to run the church building, the programs and pay the the pastor. The bulk of it (pastor pay) is then spent out in the marketplace by their families.

 

That income is taxed at the outset, because it comes from a taxed individual. This just cuts down on the paperwork headache and a fair bit of red tape, but no significant revenue. Or maybe youren use thinking of churches bigger than mine, that aren't on shoestring budgets. That would be about 1.5% of them.

 

I'm not actually opposed to modifying or doing away with the tax exempt status, because it subjects us to Caesar's laws in a way that operating with no exempt status doesn't, but it has nothing to do with the pithy sums of money.

 

Let's raid governmental waste and tidy that up in, oh, the EPA or HUD, first, and when every penny is accounted for and fair value for the services rendered, with no inflation, private contract jockeying, or ridiculous salary increases for no accountable performance improvements, I will happily let you tax our little falling down church building and staff. Mmmkay?

 

Churches would be "doubly taxed" the same way any service is "doubly taxed" in that the one paying for the service pays from their own taxable income. 

 

Suggesting one thing should be amended only after everything else (or a significant chunk) is in perfect working order is absurd. It's not an argument for maintaining tax exemption, it's a red herring. 

 

You have no idea what you are talking about. My church has never asked about sexual orientation before dispensing charity. No, we won't perform same sex marriages or hand out contraceptives or fund abortions, but when it comes to helping those in need there isn't a sin questionnaire. Food and basic medical care don't have a sexual orientation.

 

If the only charitable work out of the RCC was feeding the poor, you'd have a point. But that's not the only charitable work. Their discrimination against LGBTQ people ranges from denial of services to the community (ie, adoption services) to denial of services to employees of these charities (ie, health care), to lobbying for promotion of religious friendly legislation (link). The Economist estimates the catholic church spent $171,600,000,000 in 2010. The Friendly Atheist breaks that down a bit, showing how only $3.3 billion was spent in settlements regarding pedophile protection and cover-ups over the past 15 years. Most of this money comes from local churches (including yours, should someone sue a diocese near you). It is estimated 57% of this goes on health-care networks, followed by 28% on colleges, with parish and diocesan day-to-day operations accounting for just 6% and national charitable activities just 2.7%. This isn't feeding the poor, it's employing people and paying for the operations of services that serve the public (some restrictions may apply, such as sexual orientation and health care insofar as it complies with religious beliefs). I don't mind churches employing people and providing services, even restricting services based on their religious beliefs. I mind contributing to that financially.

 

I said "diaconal" which is related to deacons.  Nothing to do with diocese.

 

But your point doesn't remain. Your point was that my church tries to manipulate people by withholding help to certain groups of people.   They don't.   People walk into the church asking for help.  They are given help - to the extent we have funds, to help them. We are a small church and don't have buckets of money; we don't have the space to have a food bank, etc.  But we don't quiz people to see if they are suitable for our help. We just try to help them.  

 

I doubt my little church is unique in that regard. 

 

Any organization that promotes the idea that behavior is a matter of "sin," and that behavior can be modified as per addressing that "sin," is engaging in manipulative behavior. When your church helps the community specifically identifying itself as a church, you're promoting an claim that is not only unsubstantiated, defies all information known, but you're promoting your community as a service to the people based on that claim - service for helping address "sin." I think church communities should register their organizations that offers charitable works as tax exempt services, use that funding to contribute to their service to the public without religiously inspired restrictions, hide any affiliation with the church, run the two separately. Go out and do good works, just don't promote faith based claims and services on the public dime. 

 

In my opinion Churches have non-profit tax status because they are a collective/co-operative group that pools money but does not generate a profit.

 

Supreme Court Chief Justice Burger ruled (1970), that "The State has an affirmative policy that considers these groups as beneficial and stabilizing influences in community life and finds this classification useful, desirable, and in the public interest. Qualification for tax exemption is not perpetual or immutable; some tax-exempt groups lose that status when their activities take them outside the classification and new entities can come into being and qualify for exemption."

 

I disagree with the idea that religious institutions are beneficial and stabilizing influences in community life. I think they provide services for people, and each denomination, each style of worship illustrates just how this service is promoted to different audiences according to the tastes and desires of that audience. Religious institutions were let off the hook to the tune of some $82.5 billion through tax exemptions in 2013 alone. That's money that could be spent on better education, medical care, transportation, energy renewal, and all kinds of services that are inspired by facts rather than faith. Instead, the money provided funding for abstinence only sex ed, fostering underage pregnancies and the prevalence of STDs, significantly higher in religiously identified states.  49 percent of Americans could be contributing to renewable energy resources instead of shrugging their shoulders and accepting climate change as just another inevitable sign of the End of Days. That affects all of us, regardless of one's personal beliefs. Funding faith and faith based actions shouldn't be an integral part of a secular government. 

 

Jerry Coyne's blog summarizes a recent report by The Council for Secular Humanism: “How Secular Humanists (and Everyone Else) Subsidize Religion in the United States.†I particularly agree with these comments, 

 

 

For those individuals who argue that religions should receive subsidies because of their charitable work, there is an easy solution for that problem. If religions want to engage in charitable work, they should separate religious activities and finances from their charitable activities and finances. The charities run by religions could be tax-exempt, but the religious organizations would be treated like civic leagues or sports clubs or any other volunteer organization that exists for entertainment or the benefit of its members. Those groups are not tax-exempt and are not subsidized by the government...

 

In illustrating how silly the arguments for subsidizing of religious services can appear to those who are not religious, they offer this analogy:

 

 Finally, as the perceived “benefit†to society of religions becomes increasingly irrelevant as more and more Americans cease to utilize their “services†by disaffiliating, it will also be increasingly unfair for a large percentage of nonreligious Americans (almost 40 percent in some states) to subsidize the recreational activities of others. These subsidies should be phased out. But since that is unlikely to happen, we’d accept the following alternative: the ability to write off our annual entertainment expenses as “donationsâ€; the subsidizing of all of our housing expenses, including utilities and maintenance costs; being exempt from paying taxes on businesses we start related to our primary purpose in life (say, a micro-brewery); direct cash transfers to us from the government for trying to convert people to our worldviews while claiming to provide social services; and, most important, the right to host games of bingo without reporting our income as gambling revenue!

[Shahrazad]

Your plan inevitably leads to totalitarianism, with its inevitably horrifying results.

 

Whether or not one agrees with Albeto's idea there, could you please come back and explain the steps you took to inevitably get from point A to point B? I'm genuinely not following the logic or train of thought here.

[Guest]

Well Albeto, not that I'm going to convince you of anything, but your analogy is flawed.

 

Churches are not businesses, gaining profit for services. They are maintained as cooperatives, and thus because the resources and pooled and not sold or bought, it's double taxation. Not like a normal business at all. If they were selling something it would be a totally different matter.

 

And given that churches dispense of all sorts of those funds for charitable purposes - including soup kitchen, crisis pregnancy centers, poverty assistance, daycare and transportation services, assisting with heating or medical bills, and dozens of other things (these are just examples of our own deacon fund) taxation directly impacts the amount of income we can pass on to help others.

 

I am not in favor of taxing charities, religious or otherwise.

 

You disagree, obviously :lol:

 

 

ETA - like I said earlier I actually advised my own church to forego the tax exemption when we (and all churches and religious organizations) were facing legal issues to remove the leverage against us by the city, but that doesn't mean there aren't fiscal benefits to any and all tax exempt charities to remaining that way - and these benefits are conferred precisely because the organizations are seen to have a service beneficial to the public good.

[albeto.]

But what public money are they receiving from the government?????

 

We are "the government," you and I and everyone. We pool our resources together in certain ways because we recognize more can be accomplished when we do this. I contribute to the taxes of my local churches so they don't have to.  We all do. That's less contribution to those things we as a society decide are important (like education, fixing crumbling bridges, conservation and care of public water and land, etc). Instead of contributing to roads, I'm contributing to the churches in my city, contributions that allow them to contribute to investing property and lobbying for religious friendly legislation and continue to convince people certain things are true because many people really really genuinely believe they are true. 

 

Should any non profits be tax exempt? Are we just picking on Christian churches? 

 

I think it's reasonable for all institutions that provide religious services should be taxed. Churches, Temples, Mosques, Kingdom Halls, and the like should contribute to the financial operation of the community. Public services that are provided on behalf of members of the community should not, insofar as those public services are truly open to all members of the public. 

 

Forgive my ignorance, but how is being tax exempt the same as being funded by taxes? This is an honest question. Though I often disagree with your posts, I admit you always seem to use facts as the base of your opinion. I am not aware of the government funding churches. I thought they were funded by donations that were not taxed. If I have misunderstood how tax law works, I would like to understand it better. Do you have sources to show that tax exempt = funded by taxes?

 

Churches don’t pay property taxes on their land or buildings. When they buy stuff, they don’t pay sales taxes. When they sell stuff at a profit, they don’t pay capital gains tax. If they spend less than they take in, they don’t pay corporate income taxes. Priests, ministers, rabbis and the like get “parsonage exemptions†that let them deduct mortgage payments, rent and other living expenses when they’re doing their income taxes. They also are the only group allowed to opt out of Social Security taxes (and benefits). We, the community, fund them by essentially paying their taxes for them. We, the rest of us, pick up the financial burden that society has decided is fair and reasonable for all to contribute to. 

 

I guess can we discuss what is meant by earning income....  There are 127 churches in my area.  We are one of the bigger ones as we average a liitle under 300 in attendance each Sunday.  A couple others are bigger but no one averages over 600.  As I look at our financial statement we pay salaries to our staff, pay for the upkeep of our over 100 year old building, utilities, literature, each of the ministries has a budget but other than music most are small, missions,  money to the parent organization, the food pantry, homeless shelter, missions...     I know that we do have some money in a bank account that is for emergencies or for circumstances like right now when we don't take enough in to cover our expenses ( summer months are slow, fall is much better for offereings) 

 

I guess other than what we earn on our bank account, I'm just not seeing how we are earning money.

 

Could you pay salaries and insurance and keep your 100 year old building running if your church had to pay taxes? If a church will not or can not provide a service the public is wiling to pay for, it's unreasonable for the public to be compelled to cover economic loss through taxes. From a capitalist stand point, the public shouldn't be supporting bad business practices. 

[December]

I think this is one of those things it is a little difficult to police. 

 

Those kinds of rules exist for a good reason I think - they are meant to prevent churches being used as a back-door way to fund political campaigns and candidates, which is a serious danger in a democracy.

 

But the US has already rather let the horse out of the barn on that one, so I'm not sure that what happens in churches is actually all that significant compared to the millions of dollars that go through other partisan channels. 

 

[albeto.]

Well Albeto, not that I'm going to convince you of anything, but your analogy is flawed.

 

If you have reasonable support for your argument, I'm happy to consider changing my mind.

 

Churches are not businesses, gaining profit for services. They are maintained as cooperatives, and thus because the resources and pooled and not sold or bought, it's double taxation. Not like a normal business at all. If they were selling something it would be a totally different matter.

 

And given that churches dispense of all sorts of those funds for charitable purposes - including soup kitchen, crisis pregnancy centers, poverty assistance, daycare and transportation services, assisting with heating or medical bills, and dozens of other things (these are just examples of our own deacon fund) taxation directly impacts the amount of income we can pass on to help others.

 

I am not in favor of taxing charities, religious or otherwise.

 

Regardless of whether or not churches are maintained as cooperatives, I think they are businesses. They sell a service, and each church has it's own variation of a larger brand. I don't have a problem with that, but my income, sales, and property taxes shouldn't be maintaining these services that do not serve the public, but serve the customer. 

 

Soup kitchens, and assisting with financial bills can and should be done in cooperatives that are tax deductible so long as they serve the public without restriction. Daycare providers have different standards of care depending if they are religious or not. That's not reasonable. Crisis pregnancy centers that operate on faith based claims rather than evidence based claims don't serve the public, they serve the needs of their religious affiliation. I'm not in favor of taxing charities either, but I am in favor of separating charities from religious institutions and operations.

[MotherGoose]

The Fair Tax would get rid of all these concerns (well as far as federal taxes are concerned, then individual states could sort out what they thought about property taxes etc.)  I think getting rid of the federal income tax and all tax deductions of any sort would eliminate all sorts of corruption, from that of political action committees to churches, to charities, to politicians.  It would stop the government's manipulation of our behavior through taxes: do you want to invest X number of dollars for your retirement?  Great, go ahead, and you won't be taxed on the earnings.  It would save me having to pay a CPA to do my taxes.  Federal taxes would be paid as part of the sales tax at the time of purchase of any new item, and everyone, regardless of income (because the government would no longer know anyone's income, a beautiful thing), would get a stipend to cover the taxes on the basics of living.  People could donate to whatever charities they wanted to and the charities or churches could do what they wanted without worrying about taxes.  I think it's a perfect solution.  The poor would pay less because they would buy less, when a rich person buys a yacht, they'd pay sales tax on the yacht.  It would make drug dealers, prostitutes, illegal immigrants, and your relative who is supposed to be on disability but works "under the table" have to pay taxes again.  And don't forget the tourists: they'd be paying the tax also.  I guess I am digressing a bit from the thread, but the basic point is that yes I think we should get rid of tax exemption for everything, and that would remove any concerns about what the churches are or aren't doing with the tax money, because it would no longer be relevant except on a local level of course. 

[Guest]

I have major issues with the Fair Tax because we have yet to have a proponent guarantee us that additional rates wouldn't be added in the future.

 

Now the Flat Tax I'm hugely in favor of. Love it!

 

Hey.... We should start a tax thread! :D

 

 

(Hop hop hop goes the bunny down the trail)

[MotherGoose]

I have major issues with the Fair Tax because we have yet to have a proponent guarantee us that additional rates wouldn't be added in the future.

 

Now the Flat Tax I'm hugely in favor of. Love it!

 

Hey.... We should start a tax thread! :D

 

 

(Hop hop hop goes the bunny down the trail)

I like the Flat Tax too, but the reason I like the Fair Tax the best is because it gets rid of the IRS !! :)

[shinyhappypeople]

If you have reasonable support for your argument, I'm happy to consider changing my mind.

 

 

Regardless of whether or not churches are maintained as cooperatives, I think they are businesses. They sell a service, and each church has it's own variation of a larger brand. I don't have a problem with that, but my income, sales, and property taxes shouldn't be maintaining these services that do not serve the public, but serve the customer. 

 

Soup kitchens, and assisting with financial bills can and should be done in cooperatives that are tax deductible so long as they serve the public without restriction. Daycare providers have different standards of care depending if they are religious or not. That's not reasonable. Crisis pregnancy centers that operate on faith based claims rather than evidence based claims don't serve the public, they serve the needs of their religious affiliation. I'm not in favor of taxing charities either, but I am in favor of separating charities from religious institutions and operations.

 

That's not accurate.  

 

Scenario 1:  I will offer you this particular product or service if you give me $x.  If you don't give me the money, you don't receive the product or service. If I've already rendered the service or given you the product and you never pay for it, I have legal grounds to sue you.  That is a business.

 

Scenario 2:  We gather together weekly to worship and enjoy community together.  We pass the offering plate and people can contribute or not. The donations go to pay for overhead and help out in the community, however giving is totally optional.  There is no admission fee to church services (or Bible studies or potlucks, for that matter).  No one is going to be escorted from the building because they didn't put enough (or anything) in the offering plate.  ALL are welcome to worship with us free of charge.  Churches are not businesses.  

[kwg]

"Property tax exemption for religious organizations is one of the evilest entitlements. In 1970,TIME Magazine pinpointed the real estate value of religious organizations at $102 billion. Property worth since then has ascended six-fold; today’s tag would be approximately $612 billion. Nationwide, themedian property tax rate is 1.38%, which means about $8.45 billion annually is not collected from religious groups....."

 

 

 

I wonder if the numbers are right there? That is a lot.

 

http://ieet.org/index.php/IEET/more/pellissier20110506

[MotherGoose]

Forgot to quote

[MotherGoose]

They do not sell a service. Normally, only about 20 percent of the people who attend a church actually give something to it. You do not pay a fee to enter. It is free. I was shocked when we were first married and the church we were attending showed the percentage of people who gave each amount. We were one of the top givers and that was off of my school teacher's salary..... I couldnt believe it. So the church is not selling anything.

 

I have no idea what you mean by different standards of care. Our daycare has to follow the same rules as everyone else. Our daycare loses money and/or barely breaks even. We have voted to supplement them many times. Our daycare is subject to TONS of federal rules.

That's my experience too.

[idnib]

Generally speaking, I don't support taxing churches/temples/mosques/etc. or even charities in general.

 

However...

 

Maybe we should just think about the gift tax. This year, I can give money to anyone else in the U.S. and they don't have to pay taxes on it, no matter how much money they have. This year's limit is $14000 and if I cut a check for that to a billionaire, it would be tax-free.

 

Perhaps we could apply that idea that people are giving a gift of their choosing to an organization rather than an individual, and if that gift exceeds that year's tax-free gift limit, the church/mosque/temple/etc would have to pay taxes on it. It seems funny to me that DH and I could give $28,000 to anyone we wanted and they wouldn't have to pay anything, but $10 in the donation plate is a problem.

[Mommy22alyns]

So are we also going to revoke the tax-exempt status of Planned Parenthood and the Clinton Foundation?  I seem to recall that Cecile Richards makes a pretty tidy salary.

[fraidycat]

So are we also going to revoke the tax-exempt status of Planned Parenthood and the Clinton Foundation? I seem to recall that Cecile Richards makes a pretty tidy salary.

We aren't going to do anything.

 

The question was why should churches be tax exempt beyond their charitable works. I'm kind of still waiting on that answer. This isn't about PP or Clinton foundation - but another thread can be started if you wish to discuss all non-profits and taxation.

[Audrey]

I guess can we discuss what is meant by earning income....  There are 127 churches in my area.  We are one of the bigger ones as we average a liitle under 300 in attendance each Sunday.  A couple others are bigger but no one averages over 600.  As I look at our financial statement we pay salaries to our staff, pay for the upkeep of our over 100 year old building, utilities, literature, each of the ministries has a budget but other than music most are small, missions,  money to the parent organization, the food pantry, homeless shelter, missions...     I know that we do have some money in a bank account that is for emergencies or for circumstances like right now when we don't take enough in to cover our expenses ( summer months are slow, fall is much better for offereings) 

 

I guess other than what we earn on our bank account, I'm just not seeing how we are earning money.

 

 

If you were to look up the tax obligation of a non-profit organization with your church's financial equivalent, you would easily be able to see how much, if any, tax your church would pay.   As I clearly stated, non-profits have a different tax structure than individuals.  And as I also clearly stated, it would depend on your church's financial statement post-deductions as to whether OR NOT there would be tax to pay.

 

What I am saying... and keep repeating... is that churches should be subject to the same scrutiny and obligation as any other non-profit organization. 

 

Religion should not make one exempt from anything. 

 

Period. 

[idnib]

We aren't going to do anything.

 

The question was why should churches be tax exempt beyond their charitable works. I'm kind of still waiting on that answer. This isn't about PP or Clinton foundation - but another thread can be started if you wish to discuss all non-profits and taxation.

 

You changed your avatar!

 

Here's my answer to your question (more at the link, excerpt below):

 

 

In its 1970 opinion in Walz vs. Tax Commission of the City of New York, the high court stated that a tax exemption for churches "creates only a minimal and remote involvement between church and state and far less than taxation of churches. [An exemption] restricts the fiscal relationship between church and state, and tends to complement and reinforce the desired separation insulating each from the other." The Supreme Court also said that "the power to tax involves the power to destroy." Taxing churches breaks down the healthy separation of church and state and leads to the destruction of the free exercise of religion.

 

[albeto.]

That's not accurate.  

 

Scenario 1:  I will offer you this particular product or service if you give me $x.  If you don't give me the money, you don't receive the product or service. If I've already rendered the service or given you the product and you never pay for it, I have legal grounds to sue you.  That is a business.

 

Scenario 2:  We gather together weekly to worship and enjoy community together.  We pass the offering plate and people can contribute or not. The donations go to pay for overhead and help out in the community, however giving is totally optional.  There is no admission fee to church services (or Bible studies or potlucks, for that matter).  No one is going to be escorted from the building because they didn't put enough (or anything) in the offering plate.  ALL are welcome to worship with us free of charge.  Churches are not businesses.  

 

Grabbing this definition for convenience: 

 

An organization or economic system where goods and services are exchanged for one another or for money.

 

Every business requires some form of investment and enough customers to whom its output can be sold on a consistent basis in order to make a profit.

 

Businesses can be privately owned, not-for-profit or state-owned. An example of a corporate business is PepsiCo, while a mom-and-pop catering business is a private enterprise.

 

Churches exchange services [illusion of salvation, community] for money. Those that don't make a profit close their doors. Those that do, continue providing their services.

 

 

They do not sell a service.  Normally, only about 20 percent of the people who attend a church actually give something to it.  You do not pay a fee to enter.  It is free.  I was shocked when we were first married and the church we were attending showed the percentage of people who gave each amount.  We were one of the top givers and that was off of my school teacher's salary.....  I couldnt believe it.  So the church is not selling anything.

 

I have no idea what you mean by different standards of care.  Our daycare has to follow the same rules as everyone else.  Our daycare loses money and/or barely breaks even.  We have voted to supplement them many times.  Our daycare is subject to TONS of federal rules.  

 

Services are exchanged for money or work (Sunday school teachers may work for free, local business owners may provide products for free for the church's use, etc).

 

In 14 states(1), religiously affiliated child care centers are not required to meet some or all of the same health, safety, and caregiver-training standards that licensed or “state-approved†child care centers must meet and are not required to be inspected in the same manner. However, despite the lax standards, many religiously based centers still receive taxpayer funding to operate. Sad examples  of consequences of such privileges available upon request. You can check your state for any requriement exemptions available to religious day care providers. 

 

 

So are we also going to revoke the tax-exempt status of Planned Parenthood and the Clinton Foundation?  I seem to recall that Cecile Richards makes a pretty tidy salary.

 

This thread is about church tax status, not all not for profit, tax exempted organizations. Neither PP nor CF provide religious services. And I suspect very few people share my opinions, so I don't think anything is going to be revoked any time soon.