Posted on 09/16/2006 3:19:22 PM PDT by Alex Murphy
Seems to me that it is McCain-Feingold that has caused the charge, not what the retired rector said. So far as is reported, he really didn't cross the line, at least in terms of rational law.
That last characterization would exclude McC-F, of course, which is pure totalitarian jackbooted nonsense. I cannot say it is a consolation to see a liberal church hoist with this. For one thing, it's now two years later. Has the IRS been stewing over this since 2004? Or does it simply take this long for the accountants to make up their minds?
Tough call overall, especially in light of what else you say. The black churches have been openly campaigning for years, but are apparently immune to even being mentioned in this connection. Must be nice to have the fix that firmly in. You'd think they'd be nicer than they are, but when you give a bully his way, he just gets worse.
And yes, it is McCain-Feingold "law" causing the problem. Lib-Dem spokesmen only raising their "amen" when it was traditional pro-Bush churches speaking from the pulpit. Lib-Dems plastered the headlines with themselves saying how "wrong it was for political speech like this to be happening in a church".
Traditional Anglican ping, continued in memory of its founder Arlin Adams. Hmmm...I think I need to consider this. You know, what with the Muslim reaction to the Pope and all, perhaps now is the right time to compose a sermon on Just War.
What think you to that, Alia? Shall I pursue that political hot potato?
Only unincorporated churches are automatically tax exempt. Incorporated churches must apply for recognition of Section 501(c)(3) status and meet certain requirements in order to be exempt from federal taxation or to receive tax deductible contributions.
You need the IRS determination letter for exemption from local taxes, income, sales and real property.
An unincorporated church does not need a letter of exemption. They only need to declare that they are a church to the taxing authority and that authority then must make a determination if they are indeed a church. (This varies wildly from state to state). For sales tax and banking and employee income tax purposes an unincorporated church can obtain a Federal ID number after filing a fictitious name application with their Department of State.
You need to get the determination letter from the IRS for Federal purposes when the IRS audits or challenges the status because you are not complying with the conditions for exemption.
There are no conditions for exemption if the church is unincorporated.
According to the Internal Revenue Code, "a church, its integrated auxiliaries, and conventions and associations of the church are excluded from taxation." United States Code, Title 26, § 508(c)(1)(A).
Section 508(c) of the Internal Revenue Code provides that churches are not required to apply for recognition of Section 501(c)(3) status in order to be exempt from federal taxation or to receive tax deductible contributions. Churches are automatically exempt from Federal income tax, and contributions to churches are deductible by donors under section 170.
If you want to engage in political campaigns or lobbying for legislation then refuse the exemption and don't have the financial supporters take the contribution deduction or file for a different status than the 501 (c)(3). . .
It is much simpler to refuse to incorporate.
The state is not taking away our First Amendment rights, we are trading those rights away for a corporate charter.
Boy, that's something you don't read everyday (and have it not be about a conservative church).
I bet most people don't know that any minister can claim every thing he puts into his home as a deduction - such as grass for the yard, any improvement (paint flooring etc) before he has to pay taxes on his income - something the average taxpayer isn't allowed to do. I believe this rule from IRS came about from the time when ministers income was very very low and they lived in parsonages. Now they make just as much money as most people. For instance, in the 5,000 +/- town where we live, the Baptist minister makes $50,000 plus benefits (car, house allowance)
I agree with you.
As an Episcopalian, this makes me very happy.
It is past time for allowing so called no profits to be nothing but Shills and a Shilling place for the left wing Rat Agendas.
"Only unincorporated churches are automatically tax exempt. Incorporated churches must apply for recognition of Section 501(c)(3) status and meet certain requirements in order to be exempt from federal taxation or to receive tax deductible contributions."
Where is that found in the Internal Revenue Code? In all of its literature the automatic exemption is not limited to "unincorporated" church.
An unincorporated church is protected in the first amendment. A church that has incorporated is not a church at all but instead a corporation that must follow state law pertaining to corporations.
A unincorporated church is automatically nontaxable; an incorporated church is a taxable corporation that must meet certain criteria to obtain tax-exempt status.
"A unincorporated church is automatically nontaxable; an incorporated church is a taxable corporation that must meet certain criteria to obtain tax-exempt status."
Where is it found in the Tax Code? I have been representing churches for many years and have never heard of this, so please point out in the Code where unincorporated churches are automatically exempt but incorporated churches are not and must apply. As far as I know both forms of assembly are automatically exempt.
508. Special rules with respect to section 501 (c)(3) organizations (a) New organizations must notify Secretary that they are applying for recognition of section 501 (c)(3) status Except as provided in subsection (c), an organization organized after October 9, 1969, shall not be treated as an organization described in section 501 (c)(3)— (1) unless it has given notice to the Secretary in such manner as the Secretary may by regulations prescribe, that it is applying for recognition of such status, or (2) for any period before the giving of such notice, if such notice is given after the time prescribed by the Secretary by regulations for giving notice under this subsection.
Note that 501 (c)(3) deals only with corporations and charitable organizations. These corporations and charitable organizations must give notice that they are applying for tax exempt status. If they do not, they will be presumed to be a private taxable foundation.
(b) Presumption that organizations are private foundations Except as provided in subsection (c), any organization (including an organization in existence on October 9, 1969) which is described in section 501 (c)(3) and which does not notify the Secretary, at such time and in such manner as the Secretary may by regulations prescribe, that it is not a private foundation shall be presumed to be a private foundation.
In short the incorporated church and any charitable organization must apply for tax exempt status.
There is an exception in the above code found in subsection (c). Let's see what it has to say:
When a church incorporates it is no longer a church in the eyes of the state. It instead has become a religious corporation and must follow the laws and rules that apply to corporations. When a church chooses to incorporate, it chooses freely to give up it's first amendment rights and consents to be ruled by the state through the laws of incorporation.
Where in the Code you have set out does it say the IRS differentiates between incorporated and unincorporated churches? There is no difference. The IRS looks at the organization called "church" without distinguishing corporation from unincorporation. Look at form 1023 the Application for 501 (c)(3) recognition.
I have explained that before in my posts #26 and #34.
508 of the IRS code allows an automatic exception for churches. It doesn't say "exemption," it says, "...churches have a mandatory exception." The exception is from filing a Form 1023 to make application for not for profit status and from filing the annual Form 990. (note a church may voluntarily file these forms but it is not required.)
Incorporated churches because the IRS sees them as tax exempt corporations are not eligible for this exemption. They must file a Form 1023 and the annual Form 990.
The IRS does indeed differentiate between the two.
"Incorporated churches because the IRS sees them as tax exempt corporations are not eligible for this exemption."
You are absolutely wrong on this. A church is a church whether it is incorporated or unincorporated. The Tax Code does not differentiate. All the the incorporation does is give perpetuity to the organization and limits the liability of its members. It is a artificial entity made up of members with a common purpose. Look at what you wrote:
"According to the Internal Revenue Code, "a church, its integrated auxiliaries, and conventions and associations of the church are excluded from taxation." United States Code, Title 26, § 508(c)(1)(A)." There is no differentiation as to incorporated or unincorporated church in that statement.
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