Should churches have tax exempt status?

[MichaeltheGreat]

Originally posted by Rufus T. Firefly


You win; that's the dumbest analogy I've ever seen on Poly. Your trophy's in the mail.

Here's a proper analogy, just so you can tell the difference. Suppose, as a private citizen, I own a strip mall in suburban Chicago; suppose I donate all the money I make from the mall -- beyond what's required to feed and clothe my family -- to charity. (1) Is the strip-mall itself exempt from property taxes? (Answer: No). (2) Should it be?

This example misses the legal point entirely. If you donate the money you make from the mall in one year, that's nice and deductible, but it doesn't mean (a) you HAVE to do that every year, or (b) that the strip mall is OPERATED solely for that purpose. IF you formed a qualified 501(c)(3) organization that owned that strip mall, then you'd have no discretion as to how you distributed the "profits" (technically earnings in excess of cost), you would generally be exempt from most forms of taxation in most jurisdictions. Filing for property tax exemption on previously non-exempt property varies from taxing jurisdiction to taxing jurisdiction, but in most jurisdictions, it can be done.

This still misses the point that the Establishment Clause is intended to completely bar government jurisdiction over religious activity. It's not that the government chooses to tax one, and not the other, it's that the jurisdiction of government ends at the church property line for a vast number of purposes. (Land use and public safety being the almost exclusive exceptions, because the laws in those areas are based primarily on off-site impacts.)

[MichaeltheGreat]

Originally posted by Wernazuma III
Then tax them, otherwise it's just a legal hole for all kinds of unscrupulous "businessmen".

If it was, you'd have tons of them, instead of just a few nuts. You can form your own religion here, but it is rather constraining to go through the accounting hoopla. There's more money to be made in regular business without those constraints.

[Rufus T. Firefly]

MtG - I take you point and agree completely; I was not responding to the legal point, but to PLATO's assertion that tax-exemption is deserved just because an organization "does good."

BTW, your characterization of how church-owned property is taxed actually differes from state to state -- not surprisingly, since property taxes aren't federal. But I take your overall point.

[PLATO]

Originally posted by Rufus T. Firefly


You win; that's the dumbest analogy I've ever seen on Poly. Your trophy's in the mail.

Then you apparently don't pay attention.

You were talking about tax subsidy, correct? It exists in many forms (One of which I pointed out in the example that was apparently beyond your comprehension (Sorry-will try to keep it simple)). These exemptions exist because government has determined (through the voice of the people) that certain activities are worthwhile. Weather or not it is relieving the burden on lower income people or relieving the burden on charitable organizations is irrelevant.

The problem comes in when people disagree on what is worthwhile. Many would agree that EIC is wrong just as many would agree that tax-exempt status is wrong fro charities. The determination that government must make is weather or not the benefit to society outweighs the cost. Given the investment in people from both a pysical and moral perspective it would be very hard to argue that Churches do not benefit society. I don't agree with the teaching of Islam, but i support a mosque's tax exempt status because of the benefit that having that mosque provides for society. Hope I didn't get to complicated there. I will forward the trophy that you posses back to you upon reciept...apparently already in the hands of the rightful owner.

[MichaeltheGreat]

Play nicely now, guys.

[Dr Strangelove]

Originally posted by PLATO


I have no problem with synagogues, mosques, etc.. having tax exempt status. In fact, they should have.

I'm prety sure that they do.

[Ben Kenobi]

There has been a little bit of talk about churches having their tax-exempt status taken away. I'm not prepared to support this yet, but it is decent idea. And a new way to generate revenue for the goverment.

The proposal would backfire. Churches take a fair amount of the government's burden due to the social programs they provide. By taxing the churches, people would be much less likely to give if they know a portion of the money goes directly to the government. Ergo, the church has to cut back on the programs, and the government takes up the slack.

The Catholics (and not only them) own firms, banks, estates and other economic institutions, hold back large amounts of capital etc. etc.

I don't see a problem if the profits are plowed back into charitable works, as many of these institutions do, and not profits for the owners.

[monolith94]

"Only if synagogues, mosques, etc etc get the same status. Ideally, none of them should, they are businesses like any other, and don't do any DIRECT charitable work."

What the hell??? My church is NOT a business!!! We make barely enough money in offerings and member support to scrape by every year, with any extra going to fund causes in the Boston area, plus we run a thrift store so that people can get clothes for extremely little money, etc... What planet are you from???

[MichaeltheGreat]

Originally posted by CorpusScorpius
Does anyone know if the pastors,reverends,priests, ministers pay any taxes if they work exclusively for the church?

Yes, they do. There are some special deduction issues (which often get abused by scammers in the "ordain yourself and declare your home your church" school of BS) relating to church-provided housing, and some other areas of employee business expenses and benefits taxation, but in general, employees of religious organizations are subject to all standard employment taxes.

IRS Tax Topic 417 - Earnings for Clergy

[Kaak]

Originally posted by Rufus T. Firefly


True of churches themselves, but what of, say, income-producing property (office buildings, for example) owned by a Catholic diocese? The income is plowed back into the diocese, which then spends it in ways that allow it to be "non-profit"; but the property itself has absolutely no status as religious.

Almost all Not For Profit organizations own property and offices.

(2) Not taxing churches is in effect a government subsidy of religion. Think about it. The big church down the street is not paying taxes on its property. Any other operation would be paying property tax - ergo, the city is losing the revenue that property taxes would be generating. That is a classic subsidy.

It doesn't have anything to do with religion. It is a NON PROFIT, therefore it is not taxable, just like any humanitarian group, etc. To take away their tax exempt status while they meet all NON PROFIT requirements would be a direct attempt to quell religion, and that cannot be argued. Some of you are trying to add religion to this, when religion doesn't have anything to do with whether or not non-profit organizations are taxed.

[Imran Siddiqui]

Very good points. I never thought of it as churches being non-profit organizations. I guess it makes sense, but I hadn't seen that argument raised. Of course, then, they shouldn't be taxed.

And other non-profit organizations can back political candidates, so I don't see why churches shouldn't.

[MichaeltheGreat]

There are tax law distinctions between not-for-profit organizations, non-profit and charitable organizations, non-profit religious organizations.

Depending on the nature of the organization, promotion, fundraising and other forms of support for political candidates, as well as some types of lobbying of officeholders, can result in loss of tax exempt status.

[SlowwHand]

Why don't you just go to a KKK meeting and ask if Black's should have equal rights?

Would be about as smart as coming into an Atheist refuge like this, and asking such a dumbass question.

[Wernazuma III]

Originally posted by obiwan18
I don't see a problem if the profits are plowed back into charitable works, as many of these institutions do, and not profits for the owners.

Sure Every organization will claim that. You only have to follow the stream of the profits of firm x around 10 corners and you'll see how charitable it actually is! The main aim of a religion is redemption, salvation etc. and only if you accept that one should give them tax exemption. If not, free those parts from the institutions from taxes, which are actually occupied with charity. Again against catholics (actually I like protestants even less, but Austria is so predominately catholic that I know better about them), most of the money is simply pumped into restauration of culturally important buildings, i.e. churches (maybe make a tax exemption for that, not a bad idea) and part goes to Rome, from where it's pumped to spread the faith around the world and pay the fines the church has to pay for lawsuits against pedophile priests. Sure, exempt that from taxes...

[Sava]

If they wish to participate in government, they should be taxed like everyone else. If they want to shut up and practice their religion privately, fine. Then they shouldn't be taxed.