Church and Taxes...

[iGary]

So I was commenting on a story in our local paper where some of our local politicians are forming an organization to "recruit Christians" and the church to get involved in local politics (Maryland).

My response was that the church should pay taxes if they want to be involved in politics to which someone responded "you mean like ACORN - nice try."

So where do we draw the line between political involvement and non-profits?

[leekohler]

Politicians can recruit Christians all they want. There's no law against that. If the actual church is being used as a bully pulpit for a certain political party, that's when the line should be drawn.

[imac/cheese]

Politicians can recruit Christians all they want. There's no law against that. If the actual church is being used as a bully pulpit for a certain political party, that's when the line should be drawn.

I agree.

[Zombie Acorn]

Religion is so ingrained in our society that I think its hard for people to separate general morality and good from religion. I imagine if this was any other group the religious zealots would be having a fit (ie. if an atheist movement decided to start recruiting atheists to get into politics).

[mactastic]

Religion is so ingrained in our society that I think its hard for people to separate general morality and good from religion. I imagine if this was any other group the religious zealots would be having a fit (ie. if an atheist movement decided to start recruiting atheists to get into politics).
I don't care a bit about recruiting Christians into the political sphere. It's recruiting tax-exempt *churches* into the political sphere that I object to. And really, even that objection is only half-hearted. It's one thing for a preacher to talk about issues that dovetail with their beliefs, and it's quite another for a preacher (or church) to endorse specific candidates or ballot issues.

IOW, go ahead and preach that homosexual marriage or abortion is a sin, just don't cross the line into saying "voting no on Prop 8 is a sin" or "voting for John Kerry is a sin". And don't go around selectively enforcing church doctrine to make a political point, for example advocating denial of communion to someone who supports abortion rights but not advocating denial of communion to someone who has been divorced (or eats shellfish, wears mixed fabrics, etc.).

[TuffLuffJimmy]

Why don't churches pay taxes? They get the same services that everyone else must pay for, police, fire fighters, etc.

[adrianblaine]

And don't go around selectively enforcing church doctrine to make a political point, for example advocating denial of communion to someone who supports abortion rights but not advocating denial of communion to someone who has been divorced (or eats shellfish, wears mixed fabrics, etc.).

I don't think politics truly play into this scenario, mostly because it seems to me that (religious) people view some "sins" as worse than others. Getting divorced has become a lesser sin as its frequency has increased. When my parents were divorced 15 years ago, my dad was asked not to attend that church anymore. Now, no one bats an eye at the fact that divorce is occurring in the exact same church with many of the exact same people still going there.

Why don't churches pay taxes? They get the same services that everyone else must pay for, police, fire fighters, etc.

It's any non-profit organization, of which churches are probably the majority, but they certainly are not the only one getting benefit of not paying taxes.

[iJohnHenry]

I believe they are in the clear on this, unless and until they start preaching politics from the pulpit.

[EricNau]

So where do we draw the line between political involvement and non-profits?
I absolutely reject the notion that churches are not-for-profit.

Allow churches a tax-free charitable account, i.e. for legitimate charity uses, but the rest is fair game, I say.

The main objective of a church is not to help, rather it is to sell a product: heaven. Yes, many churches commit charitable acts, and money designated solely for such acts should be tax free, but other than that, churches should be taxed like any other business.

[Zombie Acorn]

I absolutely reject the notion that churches are not-for-profit.

Allow churches a tax-free charitable account, i.e. for legitimate charity uses, but the rest is fair game, I say.

The main objective of a church is not to help, rather it is to sell a product: heaven. Yes, many churches commit charitable acts, and money designated solely for such acts should be tax free, but other than that, churches should be taxed like any other business.

Thats a pretty good idea actually, make them prove their charitable contributions make up for their tax free status.

[adrianblaine]

...many churches commit charitable acts, and money designated solely for such acts should be tax free, but other than that, churches should be taxed like any other business.

Most of the money collected from churches (aside from funding charity work) goes to pay people who work for the church, who then pay income taxes. What is left goes to paying utility bills.

With your reasoning, why should churches pay taxes and those running www.atheists.org should not?

Note: I am not against the organization or those who run it. It is purely an example

[Macky-Mac]

Most of the money collected from churches (aside from funding charity work) goes to pay people who work for the church, who then pay income taxes. What is left goes to paying utility bills......

So if most of their income goes to pay wages, how do they pay for all of the real estate that churches own? Some of that property is quite valuable after all. Why shouldn't they pay property taxes just like any other property owner? Property taxes tend to pay for things such as fire protection, road construction and maintenance, police protection and so forth. Churches use these services too so why shouldn't they help pay for them?

[mactastic]

So if most of their income goes to pay wages, how do they pay for all of the real estate that churches own? Some of that property is quite valuable after all. Why shouldn't they pay property taxes just like any other property owner? Property taxes tend to pay for things such as fire protection, road construction and maintenance, police protection and so forth. Churches use these services too so why shouldn't they help pay for them?
Most non-profits own (or rent) property, not just churches.

[Gelfin]

Thats a pretty good idea actually, make them prove their charitable contributions make up for their tax free status.

This is actually what distinguishes a church from other kinds of not-for-profit entities. Not only is a church exempt from taxation, but churches are uniquely exempt from reporting any of their financial dealings to the IRS in the way a normal 503(c) organization must.

[adrianblaine]

So if most of their income goes to pay wages, how do they pay for all of the real estate that churches own? Some of that property is quite valuable after all. Why shouldn't they pay property taxes just like any other property owner? Property taxes tend to pay for things such as fire protection, road construction and maintenance, police protection and so forth. Churches use these services too so why shouldn't they help pay for them?

What about universities, some hospitals and other institutions? They would all need to pay property taxes. Especially properties owned by many universities is extremely valuable and the taxes would be enormous.

[Rodimus Prime]

So if most of their income goes to pay wages, how do they pay for all of the real estate that churches own? Some of that property is quite valuable after all. Why shouldn't they pay property taxes just like any other property owner? Property taxes tend to pay for things such as fire protection, road construction and maintenance, police protection and so forth. Churches use these services too so why shouldn't they help pay for them?
In some states they do have to pay it. That is a state issue not a federal.

What about universities, some hospitals and other institutions? They would all need to pay property taxes. Especially properties owned by many universities is extremely valuable and the taxes would be enormous.

A good point as well.

[Macky-Mac]

What about universities, some hospitals and other institutions? They would all need to pay property taxes. Especially properties owned by many universities is extremely valuable and the taxes would be enormous.

if these private institutions are building wealth and aren't directing that wealth towards the community good, then perhaps they should help pay for the services they consume

[adrianblaine]

if these private institutions are building wealth and aren't directing that wealth towards the community good, then perhaps they should help pay for the services they consume

Of course, but how many are amassing wealth? If they do, it should be investigated and their "not-for-profit" status revoked.

[Sehnsucht]

Of course, but how many are amassing wealth? If they do, it should be investigated and their "not-for-profit" status revoked.

Reminds me of the snake-oil peddler Benny Hinn (http://en.wikipedia.org/wiki/Benny_Hinn), who got his ass chewed big time for taking his audiences on guilt-trips about donating money "for the poor starving African children", and then going on big religious tours and staying in luxury hotels that ran $3,000+ per night. These nutty televangelists always play the "poor starving African children" card so their clueless followers will give them money, which they then spend on huge mansions and cruises and other taxable expenditures. It makes me want to puke. :mad:

[adrianblaine]

Again, I completely agree, though for every Benny Hinn in the world, there are thousands of institutions that are not thieving imbeciles.

[Macky-Mac]

Of course, but how many are amassing wealth? If they do, it should be investigated and their "not-for-profit" status revoked.

well who knows how many.....you're in the Los Angeles area, plus I'm under the impression you're an architect or studied architecture, so perhaps you'll be familiar with some of these potential examples;

1. The Rand Corporation, owns and occupies a huge building complex in downtown Santa Monica (ocean views from some offices!)

2. The Getty, occupies a substantial property located in one of Los Angeles's most desirable areas, plus they have their other location in Malibu!

3. The Skirball Museum and Cultural Center; just up the 405 from the Getty, (Mohse Sadie designed their main building)

4. USC, a private university with a large endowment, it occupies a large and valuable site near downtown Los Angeles

5. The Mormon Temple in Los Angeles, Century City adjacent which is prime real estate in our city

so in your opinion, would any of these qualify as non-profits that are amassing wealth and should perhaps be helping to pay for the tax supported services they consume?

[NoSmokingBandit]

Why don't churches pay taxes? They get the same services that everyone else must pay for, police, fire fighters, etc.

Most non-profit organizations dont pay the same taxes. A church is designed to work almost like a charity by means of community activities for the youth, helping the elderly, food/clothing drives, etc...
Unfortunately most churches dont function the way they are designed so they get the lower taxes without having to do any actual non-profit work.

[adrianblaine]

Do you think USC or the Getty is in it for the money? Organizations such as these need incentive to even operate, especially in LA. If they had to pay property taxes, they would no longer be able to operate, which would be a determinate to our society, more than the loss of tax revenue.

[Macky-Mac]

Do you think USC or the Getty is in it for the money? Organizations such as these need incentive to even operate, especially in LA. If they had to pay property taxes, they would no longer be able to operate, which would be a determinate to our society, more than the loss of tax revenue.

in it for the money or not, they're clearly amassing wealth while consuming services paid for by other people's taxes........and the Getty indeed has such a huge endowment that it could easily pay property tax

I think that perhaps one could make an argument that they do provide the community with a sufficient substitute for taxes though.....USC is as close to a pro football team as we have, and as for the Getty, well, where would you take visitors from out of town without the Getty?? :p

[adrianblaine]

... and as for the Getty, well, where would you take visitors from out of town without the Getty?? :p

That's where I take everyone that visits us down here!

Seriously though, they are making money for different reasons than other companies like Apple, Microsoft etc... Their money comes mostly from donations and do a service for the community that would be unattainable without some kind of tax break. This is the fundamental reason we don't tax institutions like these.

I would rather the Getty spend their money on acquiring new exhibits than spend donated money on paying taxes for the land they are sitting on.

This goes for historical preservation as well. Preserving important historical buildings is important, but it is costly. To own a house that is on the registry of historic significance takes a lot of work and maintenance to keep them up and receive tax breaks in order to actually have someone who wants to do it out of their own pocket. Without that, preservation wouldn't take place.

[Rodimus Prime]

Do you think USC or the Getty is in it for the money? Organizations such as these need incentive to even operate, especially in LA. If they had to pay property taxes, they would no longer be able to operate, which would be a determinate to our society, more than the loss of tax revenue.

You entire argument falls apart in that one little statement....

[adrianblaine]

You entire argument falls apart in that one little statement....

I don't quite follow. Yes, they are in need of money to operate, but that money is not used to the benefit of shareholders. I would imagine there is a lot more money to be made at other places of employment.

Yes, I'm giving the benefit of the doubt to a lot of places at this moment, but my point is that these "non-profit" organizations bring something to the table other than just a revenue stream.

[Rodimus Prime]

I don't quite follow. Yes, they are in need of money to operate, but that money is not used to the benefit of shareholders. I would imagine there is a lot more money to be made at other places of employment.

Yes, I'm giving the benefit of the doubt to a lot of places at this moment, but my point is that these "non-profit" organizations bring something to the table other than just a revenue stream.

Not a good argument.

By your own argument dog walkers should not pay taxes, nor should home repair companies or home cleaning companies. They all bring something to the table other than a revenue stream.

It falls apart right there. Churches for the most part are consider a safe place for the general population and if you need help they general will help you. And before people start yelling about that please note I stated generally. There are expection to the rule.

Most churches do not run a side business. Their only source of income is what people give to them. If they do run anything else it is almost always at cost.
Most churches struggle to get enough to pay all the bills. Big time when times are bad. A lot of them are struggling to pay the bills. Some churches had to lay off some of their staff because giving had dropped.

[adrianblaine]

I never said I was against churches getting tax breaks, I'm simply defending why we have tax breaks. Dog walkers (other than those donating their time) are trying to make money. People generally do not start churches, museums or universities in order to make a profit. They all rely heavily on donations and the tax breaks that make it possible for them to exist

[Rodimus Prime]

I never said I was against churches getting tax breaks, I'm simply defending why we have tax breaks. Dog walkers (other than those donating their time) are trying to make money. People generally do not start churches, museums or universities in order to make a profit. They all rely heavily on donations and the tax breaks that make it possible for them to exist


Ok that makes more sense just you where using very flawed logic in your defense.

If people attack churches that is one thing. There are legal cases dealing with churches and there not for profit status. Namely one with the catholic church and it renting out apartments and under cutting everyone else because they did not have to pay property tax. The other owner argue it was unfair and the church argue tax exampt.

it went to the supreme court who stated that it was fine to tax churches as long as there was not excessive legal entanglements. It is those legal entanglements is why most states do deal with it. They have to separate out what is the church not for profit stuff from profit stuff. Most of the time it is a very clear that they are not for profit. Very few if any ever rent out property to others. If so they must pay taxes on that property and any income. Now lets face it most states are not going to mess with the very few that do have things for profit until some one bring it to their attention then they are required to get involved.

Now if you want some motivation behind the states and cities not wanting to tax the property churches are built on well churches being built in an area general RAISE property values in the surrounding areas so the loss they do not get on the land from the church they make up and then some from the raised property values of the property around that area. In the end the government gets more it would get just taxing the land the church is on and it encourages them to not tax it so they are built there.

[mactastic]

Most churches do not run a side business. Their only source of income is what people give to them. If they do run anything else it is almost always at cost.
You do realize the Getty doesn't charge admission, right? Sure they charge for parking, but I'm sure that's just "at cost".

[Rodimus Prime]

You do realize the Getty doesn't charge admission, right? Sure they charge for parking, but I'm sure that's just "at cost".

Key word was MOST..... I know there are exception to that. I was wondering how long until some one would start posting individual expections instead which what I posted already allowed for the expectation to the rule.

Even those things then you have to look over there billing and see if they are still using that income just to cover other expense and not for profit. Also look at it original reason for that parking lot.

[mactastic]

Even those things then you have to look over there billing and see if they are still using that income just to cover other expense and not for profit. Also look at it original reason for that parking lot.
Well, in that case, wouldn't we also have to look over church billings ans see if they are using that income just to cover expenses, and not for profit as well? And also look at the original reason for that new nave?

[Rodimus Prime]

Well, in that case, wouldn't we also have to look over church billings ans see if they are using that income just to cover expenses, and not for profit as well? And also look at the original reason for that new nave?

I can think of some churches where I went to near the college campus when I was there that would sell year long parking pass for 30 bucks. Their reasoning (and right so) was to be able to limit the number of students who park in their lots. Other wise it would be a mad house. Mostly students who went to that church bought them. And when you compare the prices that was cheap compared to the 150 something I was paying parking going to school and the sad part is some of the students walk even less distance that I did to a few of there classes.

But it takes looking at why the charge and how they use the money. Not for profit means they can not be in it for profit. I can think of other things that most people do not release do not pay a dime in taxes. For example credit unions and there are some HUGE credit unions out there and they are all non-profit.

Churches for the most part are not shady compared to some of the other non profit organizations out there.

Also please note each state can decide if they want non-profits to pay taxes or not.

[mactastic]

Churches for the most part are not shady compared to some of the other non profit organizations out there.
I disagree. I suspect rates of "shady" churches and "shady" non-profits are similar. And I would further submit that allowing churches to avoid the level of scrutiny given to other non-profits will simply encourage the shady folks to "flock" to the religious non-profit scene.

Treat them all the same. I don't understand why that's such a controversial idea. :confused:

[Rodimus Prime]

I disagree. I suspect rates of "shady" churches and "shady" non-profits are similar. And I would further submit that allowing churches to avoid the level of scrutiny given to other non-profits will simply encourage the shady folks to "flock" to the religious non-profit scene.

Treat them all the same. I don't understand why that's such a controversial idea. :confused:

While that is true. My consern is the media would have a feild day trashing them and trying to point out that they are robbing people by point out that easy for most churches 60-70% is pure overhead cost and other 10% of what they take in is given to the next level in the churches structure.

that and they would go right after the pastor salary in that is easy push to exceed 50k/ year. *Please note pastors have a college degree and as such that is a understandable number for one with experiences.

They will play on the fact that a vast majority of people do not have a college degree and as such there max income level on average is lower compared to those who do have one.

[mactastic]

While that is true. My consern is the media would have a feild day trashing them and trying to point out that they are robbing people by point out that easy for most churches 60-70% is pure overhead cost and other 10% of what they take in is given to the next level in the churches structure.
How is that different from any non-profit? The definition of a non-profit is that any "profits" get "given to the next level" in the non-profit's "structure".

that and they would go right after the pastor salary in that is easy push to exceed 50k/ year. *Please note pastors have a college degree and as such that is a understandable number for one with experiences.
Uh huh... yet you're not worried that certain elements in the media would go right after such things as a teacher's salary? Please note that teachers have a college degree and as such $50k is an understandable number for one with experiences.

They will play on the fact that a vast majority of people do not have a college degree and as such there max income level on average is lower compared to those who do have one.
How is it fair to hold churches to a different tax standard than other non-profits? Conservatives run around demanding absolute fairness in the income tax structure, yet here you are advocating lower levels of scrutiny for one segment of non-profits over another. Won't that take the incentive away from non-church non-profits? Isn't that unfair to other non-profits that play by all the rules?

And really, why are you worried so much about a public relations fallout here? Do you really think TPTB are so anti-Christian that they will really go after churches? Are Christians such an oppressed majority in this country that they need to worry about some bad press? And wouldn't the same people who would be willing to spread bad press about churches already doing it? Are you suggesting that there would be a massive increase in bad press for churches if their finances were made more transparent? :confused:

[Desertrat]

Hey, mac, reading your Post #5, we agree on something! :)

I've thought about the issue of churches and taxes from time to time. I don't object to tax-free physical facilities, but I'm definitely uncomfortable with the idea that all investment-type real property is not taxed for ad valorem purposes. Further, I'm not really sure I'm comfortable with how churches aren't taxed on profitable returns from investments.

[Rodimus Prime]

Hey, mac, reading your Post #5, we agree on something! :)

I've thought about the issue of churches and taxes from time to time. I don't object to tax-free physical facilities, but I'm definitely uncomfortable with the idea that all investment-type real property is not taxed for ad valorem purposes. Further, I'm not really sure I'm comfortable with how churches aren't taxed on profitable returns from investments.

While I agree with Mac that they should be held to turn over the records. I do also think that those same records should not be public records but I am not sure if any non profit has to turn over public records. I do not really think that they should for any

As for Desertrat post. There are not any non-profits that are taxed on profitable returns from investments. Credit unions are non-profit and they make profitiable returns on their investments all the time (aka loans and many do play in the stock market) so requiring churches to do that would never hold up in court because other non-profits are not required to pay taxes and you can be damn sure credit unions dont.

[mactastic]

While I agree with Mac that they should be held to turn over the records. I do also think that those same records should not be public records but I am not sure if any non profit has to turn over public records. I do not really think that they should for any
AFAIK, no one has to make their tax info public; with the exception of politicians in a limited form. Non-profits, like the rest of us, share their tax info with the government, and that's it. The government only really comes snooping through your tax records if they suspect that you are up to some hanky-panky. Or if they don't like your politics, but that's another subject.

As for Desertrat post. There are not any non-profits that are taxed on profitable returns from investments. Credit unions are non-profit and they make profitiable returns on their investments all the time (aka loans and many do play in the stock market) so requiring churches to do that would never hold up in court because other non-profits are not required to pay taxes and you can be damn sure credit unions dont.
Again, AFAIK, credit unions use the profits they make to make more money available to borrowers. They don't keep it as profit. In fact, that's the very definition of a non-profit. That's why you give organizations like that a tax break, so that they have an incentive to make available finances that otherwise would be kept as profit, or paid to the taxman.

[Rodimus Prime]

Again, AFAIK, credit unions use the profits they make to make more money available to borrowers. They don't keep it as profit. In fact, that's the very definition of a non-profit. That's why you give organizations like that a tax break, so that they have an incentive to make available finances that otherwise would be kept as profit, or paid to the taxman.

I was point it out. The flaw in trying to make churchs pay taxes on their property where the church is or other investment is you run the risk of taxing a non profit when you do not tax others. Church general save the surplus just like credit unions do. I just used them as example. Like for example my credit union does give back part of the surplus every year but a good part of it goes into there own long term savings. My credit union has a pretty good size chunk in it own savings that does not include a penny of what is in the account holders. Every bit of that was from the suplus. Just figure i would point that out.

Yes churches I feel should be treated like other non profits. I agree they should have to report things.