Should the church be taxed?

Ryan_m_b

As I understand it in the UK there is a difference in the tax-exemption between charities and non-profits. For example Value Added Tax is exempt on all charitable purchases which a non-profit may benefit from but not necessarily.

Jack21222

And how are we supposed to know that there's no profit to tax unless they have to file paperwork? Right now, they are exempt from even filing. I think that's the big issue not being addressed in this thread.

What you say is correct. If there is no profit to be taxed, then there is nothing to tax when somebody says "churches should be taxed." However, as I stated in my previous post, they're not even required to file. A church could be making a TREMENDOUS profit but they don't even have to file.

SixNein

Churches are now getting federal and state money through the so called "Faith Based Initiatives." (On a side note, this is one of my great criticisms against Obama) And as others have pointed out, there exists zero accountability. Here is a very rare view inside Catholic books:

http://www.economist.com/node/21560536

In effect, we might as well say that we have a religious tax in America. Where the government transfers the collected tax money to religions of its choice.

In addition, we are also giving them tax exemption. So they don't contribute anything to our society, they are taking from society, and in many cases, they try to influence our political system.


IMO, religious people are being very successful in tearing down the wall between church and state.

SunnyBoyNY

Yet both presidential candidates openly say "God bless America". Seriously, why would you want to tax an organization whole sole purpose is to unite and help people and spread the word?

While acknowledging that the church itself might have hoarded lost of money, the priests and nuns hardly live a lavish life. A lot of money is redistributed back in the society. Also, when I donate money to a local charity, I do not wish to have the money be taxed so further cover expenditures of our ever war-mongering government.

Ryan_m_b

You do realise that not everyone agrees with religious beliefs and does not want to see more people converted into them? In addition many people (including those who share your religious beliefs) would rather live in a secular society where religion and government was firmly separate.
Whether or not the priests or nuns live lavish lives is immaterial, that's like any other organisation be it for or not for profit arguing it shouldn't pay tax on all it's money because it doesn't give much to it's workers. You'be also touched on the running point of this thread in that many people do not think that religions should be counted as charities as the aim of spreading one's religion is not in of itself a charitable one and charities by definition can have no non-charitable aims.

Curious3141

Quite the reverse, really. This story pertains to a mosque in Chicago, but the principle holds:

http://littlealexinwonderland.wordpr...hicago-mosque/

Jack21222

It turns out that the IRS isn't even enforcing rules that tax-exempt churches not get involved in politics:

http://wtop.com/628/3105426/IRS-not-...s-and-politics
Some pastors even directly challenged the IRS to taking them to court, by breaking the law and sending them proof that they did it, but the IRS didn't respond:

mathwonk

I attended churches for about 40 or more years. In my experience they were not primarily charitable. They were like tax free social clubs and business groups, where one went to find business opportunities. In my last church we had an extremely minimal charity budget if any, and there was a stink when the latest minister wanted to increase it.

Rather it seems to be argued that simply having people sit in pews and be preached at is worthy of a tax break.

Our church also flirted with a philosophy of racial segregation. We had a speaker come in and explain to us how to increase our membership, one method being to become more uniracial in our composition, because as he put it, most people are uncomfortable worshipping in a diverse setting. This hostility to diversity extended to overt attempts to strong arm members to oppose equal rights for non heterosexuals. One Sunday we were asked to physically stand up in church if we opposed such equality. I was quite uncomfortable and conspicuous sitting as almost the entire congregation stood.

In my opinion, there is very minimal if any charitable benefit to exempting churches from real estate taxes on the enormous buildings and land they occupy in my town, although there is one huge local church that does make its buildings available for an annual book festival, most of the others use them exclusively for the benefit of members events.

Even in the case of members there are often minimal services. E.g. when my mother who lived 300 miles away from me, and was a member of the same church for over 50 years, became unable to drive in her 90's, the church had no program and was uninterested in providing any for assisting its elderly members in everyday activities like shopping.

I have similar reservations about so called non profit institutions. In Boston and Cambridge Mass, e.g., Harvard University owns vast real estate holdings and is one of the wealthiest entities in Boston, but all that real estate they and other universities hold, is a dead loss to the city tax base.

The Mormon church and the Catholic church are also extremely wealthy, and when I lived in Salt Lake it was said the Mormons controlled United airlines. It just seems to me to be another example of tax breaks for the wealthy, with a few trickle down charitable benefits.

There is also the political side. In my state there are some churches where the pastors are explicitly exhorting their congregations to vote for one specific candidate for president, although that is prohibited by the law under which they are tax exempt, as Jack21222 said.

the definition of what constitutes a "profit" is also quite arguable. An entity that has so much excess money it can buy businesses and expensive real estate and pay high salaries, arguably is showing a huge profit. recall that even hollywood movies with enormous grosses are often technically said not to show any "profit" after everyone concerned has received a large payout from the proceeds. it is quite correct that not showing a profit goes hand in hand with not paying tax, but doing that is often a matter of accounting for the great sums of money generated in other ways than calling them "profit".

the tax exemption for churches can also be transferred into a tax deferment for individuals. Governor Romney has a trust set up that ostensibly is to provide a gift to the Mormon church on his death, but in the meantime has the ability to increase on investment income tax free, while it pays him and his wife a steady income, with taxes accruing only on that portion which they withdraw. The principal in the trust is well below what current law would require, and the future trend is such that in fact "next to nothing" will actually be left for the charitable donation according to one expert, after the Romneys have received and spent their withdrawals. Thus in this case, and it is common among high income individuals, the tax exemption of the church functions primarily as a tax deferment scheme for wealthy church members.

BobG

Why would the IRS respond? In spite of the extra publicity created by giving it a special name on a special day, it's not incredibly rare. In one sense, it would be advantageous to evangelicals to have the issue get a little more visibility.

Pew Research Survey

Jack21222

Because it's their job to enforce the rules.

BobG

They did enforce the rules once - in 1995. You still aren't satisfied?

Church at Pierce Creek

Of course, they placed a full page ad in the Washington Times and in USA Today. Interestingly, the church cited the numerous times other pastors/preachers/etc talked about political candidates from the pulpit and the numerous times politicians talked to congregations from the pulpit (Reverend Jesse Jackson, Senators Al Gore, Charles Robb, Frank Lautenberg and Tom Harkin, Senate candidates Oliver North and Harvey Gantt, Governors Bill Clinton, Mario Cuomo and Douglas Wilder, gubernatorial candidates James Gilmore, III and Don Beyers, Jr., Mayors Marion Barry, Kurt Schmoke and Rudolph Giuliani, and numerous others). That defense didn't help them.

The IRS just doesn't care what's said inside of churches. They only care what churches say outside of church. And... there's a certain logic to that.

BobG

Members of the Unification Church donate all of their income to their church. Their church's leader, the Reverend Sun Myung Moon, owned a fishery and paid his workers well. But he only hired members of the Unification Church, who donated all of their money to the Unification Church, who supported the Reverend Sun Myung Moon to a lavish lifestyle.

He actually did wind up getting in trouble with the IRS. Cute scam, but a little too over the top to actually get away with.

Ben Niehoff

Haven't read most of the thread. But I think we should tax churches AND allow them to preach politics as much as they want (provided that they are taxed).

The "charity" status of churches was mentioned, which is a point on which I have many doubts. Missionaries are not charity work; they are religious promulgation. I think a church should be welcome to open a genuine charity company separate from the church (i.e., create a separate account). Consequently, such a company should provide real charity, without proselytization.

russ_watters

I don't think it is reasonable to dis-allow a charity from doing marketing. We'd never do that to the Red Cross or United Way.

Jack21222

Luckily we're not talking about charities, we're talking about churches.

Containment

Wouldn't it be a form of double taxation?

russ_watters

Who is "we"? Looks to me like about half of the posts in the thread are talking about the connection.

But there is so much shooting from the hip in here, so little connection to reality. Here's the law on churches as non profits: http://en.m.wikipedia.org/wiki/501(c)_organization#section_1

Now, if we revoke the tax exempt status of churches because they don't do enough charity, what does that say for the other organizations on that list?