Should Churches Remain Tax-Exempt?

[Thumpalumpacus]

The first amendment that the church has been ignoring by getting involved in education and politics? It is supposed to go both ways, you know.

People don't lose their rights to educate others or engage in politics simply because they come together to worship.

Section 501(c)3 says differently:

(3) Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation (except as otherwise provided in subsection (h)), and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.

[Emphasis added -- Parks]

And the above-mentioned subsection (h):

(h) Expenditures by public charities to influence legislation

(1) General rule
In the case of an organization to which this subsection applies, exemption from taxation under subsection (a) shall be denied because a substantial part of the activities of such organization consists of carrying on propaganda, or otherwise attempting, to influence legislation, but only if such organization normally—

(A) makes lobbying expenditures in excess of the lobbying ceiling amount for such organization for each taxable year, or

(B) makes grass roots expenditures in excess of the grass roots ceiling amount for such organization for each taxable year.

Both passages can be found here.

The lobbying allowances are actually very generous, but I'd bet my right arm that the Catholic Church and Southern Baptist Convention exceed them. I know for a fact that in the battle over Proposition 8 in California, the Mormons blew those limits away -- and preached voting positions from the pulpit, as did AME ministers in Los Angeles.

Yet they didn't lose their tax exemption.

Now, under your favorite President, Dubya, the IRS did threaten a church with removal of exempt status:

The Internal Revenue Service has warned one of Southern California's largest and most liberal churches that it is at risk of losing its tax-exempt status because of an antiwar sermon two days before the 2004 presidential election.

Rector J. Edwin Bacon of All Saints Episcopal Church in Pasadena told many congregants during morning services Sunday that a guest sermon by the church's former rector, the Rev. George F. Regas, on Oct. 31, 2004, had prompted a letter from the IRS.

In his sermon, Regas, who from the pulpit opposed both the Vietnam War and 1991's Gulf War, imagined Jesus participating in a political debate with then-candidates George W. Bush and John Kerry. Regas said that "good people of profound faith" could vote for either man, and did not tell parishioners whom to support.

But he criticized the war in Iraq, saying that Jesus would have told Bush, "Mr. President, your doctrine of preemptive war is a failed doctrine. Forcibly changing the regime of an enemy that posed no imminent threat has led to disaster."


On June 9, the church received a letter from the IRS stating that "a reasonable belief exists that you may not be tax-exempt as a church ... " The federal tax code prohibits tax-exempt organizations, including churches, from intervening in political campaigns and elections.

http://articles.latimes.com/2005/nov/07/...allsaints7

[Emphasis added -- Parks]

Bush might be a religious man, but the message is clearly to not to fuck with his political opportunities. Living in SoCal at the time, I was surprised, to say the least, by the silence of the small-government Republicans in the face of this obvious abuse of executive power ... but I think that point belongs in another thread, so I'll leave it at that.

[Tonus]

Will not god provide?

That's a good point-- though it could just as easily be said that it is god's will that churches remain tax exempt. But it would be interesting to see that used as a reason for taxing them; if it is god's will that your church make enough to get by, then you're not worried about a tax. Or even point out that it's just another trial that they must bear before receiving their reward. Heck,many religions promote the idea of giving away wealth and depending on god. Taxing churches should not be a hardship, just another way to serve him.

[robvalue]

I think Christians read the first amendment to be, "The government shall not interfere with our special treatment. Christians that is. Other religions can fuck off."

I mean, say I start my own religion. Do I get a building to spout my drivel out of? Or do I have to make do with not praying in public like the hypocrites?

[Minimalist]

Will not god provide?

Apparently not.




Fuck him.

[Thumpalumpacus]

In Los Angeles, the cathedral which opened in 2002 cost $190 million dollars. Amongst the expenditures:

$5 million was budgeted for the altar, the main bronze doors cost $3 million, $2 million was budgeted for the wooden ambo (lectern) and $1 million for the tabernacle. $1 million was budgeted for the cathedra (bishop's chair), $250,000 for the presider's chair, $250,000 for each deacon's chair, and $150,000 for each visiting bishops' chair, while pews cost an average of $50,000 each. The cantor's stand cost $100,000 while each bronze chandelier/speaker cost $150,000.[12]

http://en.wikipedia.org/wiki/Cathedral_o...ls#History

All with money that was tax-free because this organization is presumed to be charitable.

Man, I just can't put my finger on it, but there's something about a camel and the eye of a needle that's just on the tip of my tongue.

[Nope]

I am not an accountant so maybe I am wrong on this. Don't business get to deduct the cost of running their business from the amount that they earn when they pay taxes?(Hopefully, that made sense) I still don't see how taxing churches would run them out of business. There might be a few less mega churches but they would probably be replaced by smaller churches. Perhaps the church would pay pastors a lower salary or get more involved in helping the poor so they can become a nonprofit.

Besides, those on the far right are always going on about how competition weeds out those who can't compete. Why shouldn't the same process apply to churches?

[Tonus]

How much did they budget for payoffs when they have to buy the silence of all the kids that get buggered in there?

---

I still don't see how taxing churches would run them out of business.

Property taxes could be a burden on small churches. Unless they send someone to go fish up a trout and find a check to cover the taxes in its mouth. That's what Jesus did, after all.

[robvalue]

If I don't get given my own building, that's interfering with my right to do my religious stuff. Even if its just me. Look at how many churches Christians have got! Why am I being oppressed?

I remember hearing something about the government deciding what is and isn't a religion, and having a minimum number of followers. That's some bullshit, I'm being oppressed again.

[Minimalist]

Man, I just can't put my finger on it, but there's something about a camel and the eye of a needle that's just on the tip of my tongue.

[Thumpalumpacus]

I am not an accountant so maybe I am wrong on this. Don't business get to deduct the cost of running their business from the amount that they earn when they pay taxes?(Hopefully, that made sense)

Some, but not all, expenses are deductible. Payroll, insurance benefits for employees, rent or lease payments on your business space, those things are deductible. Expenses such as storage are not. Some of the COGS is exempt, some must be capitalized, and some is taxed regularly.

Long answer short, not all expenses are write-offs, but some are.