Thanks, Nodack, for the ridiculously long post that I'm about to make longer.
Note: I am not a Supreme Court Justice (go figure) or a lawyer. I only speak to what I think about these arguments.
http://churchesandtaxes.procon.org
PRO Tax Exemption for Churches
Exempting churches from taxation upholds the separation of church and state embodied by the Establishment Clause of the First Amendment of the US Constitution. The US Supreme Court, in a majority opinion written by Chief Justice Warren E. Burger in Walz v. Tax Commission of the City of New York, decided May 4, 1970, stated: "The exemption creates only a minimal and remote involvement between church and state, and far less than taxation of churches. It restricts the fiscal relationship between church and state, and tends to complement and reinforce the desired separation insulating each from the other." [5]
It does not uphold the separation of church and state. Even a minimal and remote (and I would say it is neither) relationship violates the First Amendment, unless anyone can declare themselves a clergyman and get the same subsidies. It does in no way complement or reinforce that separation.
Requiring churches to pay taxes would endanger the free expression of religion and violate the Free Exercise Clause of the First Amendment of the US Constitution. By taxing churches, the government would be empowered to penalize or shut them down if they default on their payments. [12] The US Supreme Court confirmed this in McCulloch v. Maryland (1819) when it stated: "the power to tax involves the power to destroy." [13]
A church is a building, at least where taxation is concerned. The word "church" can also be used to describe a group of like-minded people who gather to share and celebrate their religion. In the latter sense, a "church" can meet anywhere they want. These are not the churches that would be taxed. The tax is on the land, not the people.
Churches earn their tax exemption by contributing to the public good. [14] Churches offer numerous social services to people in need, including soup kitchens, homeless shelters, afterschool programs for poor families, assistance to victims of domestic violence, etc. [15] These efforts relieve government of doing work it would otherwise be obliged to undertake.
Well, the government would not be OBLIGATED, but otherwise, I agree that for many churches, this is true. Most churches, however, are quite small, and are not themselves the site of the soup kitchen or shelters. But I'm willing to mostly concede this one.
Taxing churches would place government above religion. The Biblical book of Judges says that those who rule society are appointed directly by God. [2] Evangelist and former USA Today columnist Don Boys, PhD, asked "will any Bible believer maintain that government is over the Church of the Living God? I thought Christ was preeminent over all." [16]
IN NO POSSIBLE WAY IS TAKING A PASSAGE FROM THE BIBLE AS DEFENSE OF A LEGAL POLICY NOT A DIRECT VIOLATION OF THE FIRST AMENDMENT. I mean, that's a really f***ing stupid argument in a legal debate.
A tax exemption for churches is not a subsidy to religion, and is therefore constitutional. As stated by US Supreme Court Chief Justice Warren E. Burger in his majority opinion in Walz v. Tax Commission of the City of New York (1970), "The grant of a tax exemption is not sponsorship, since the government does not transfer part of its revenue to churches, but simply abstains from demanding that the church support the state. No one has ever suggested that tax exemption has converted libraries, art galleries, or hospitals into arms of the state or put employees 'on the public payroll.' There is no genuine nexus between tax exemption and establishment of religion." [5]
It is precisely a subsidy in any meaningful sense of the word. This is a silly semantic argument; if the accountants come out with the same number whether the subsidy was direct or indirect, it's a subsidy.
Taxing churches, on the other hand, is not asking the church to subsidize the state. Building owners pay property tax on their land and structures. This is the basic cost of doing business.
Poor and disadvantaged people relying on assistance from their local churches would suffer if churches were to lose their tax-exempt status. According to Vincent Becker, Monsignor of the Immaculate Conception Church in Wellsville, NY, the food and clothing programs his church offers would be threatened by a tax burden: "All of a sudden, we would be hit with something we haven't had to face in the past… We base all the things that we do on the fact that we do not have to pay taxes on the buildings." [17] Crucial services would either be eliminated or relegated to cash-strapped local governments if churches were to lose their tax exemptions.
LIkely not. Some churches may struggle for a time, but they would be able to balance things out. Also, the idea that the activities of the church can't exist without government support in the form of tax breaks seems to directly support the Con side of the argument.
US churches have been tax-exempt for over 200 years, yet there are no signs that America has become a theocracy. If the tax exemption were a serious threat to the separation of church and state, the US government would have succumbed to religious rule long ago. As the Supreme Court ruled in Walz v. Tax Commission of the City of New York (1970), "freedom from taxation for two centuries has not led to an established church or religion, and, on the contrary, has helped to guarantee the free exercise of all forms of religious belief." [18]
The US government is not a theocracy, but it is overwhelmingly pro-Christian. Also, this is a moot point, as the concept of separation of church and state is entirely different than the concept of establishing a theocracy.
Taxing churches when their members receive no monetary gain would amount to double taxation. The late Rev. Dean M. Kelley, a leading proponent of religious freedom, explained that church members are already taxed on their individual incomes, so "to tax them again for participation in voluntary organizations from which they derive no monetary gain would be 'double taxation' indeed, and would effectively serve to discourage them from devoting time, money, and energy to organizations which contribute to the up building of the fabric of democracy." [19]
Same with any business owner? This is ridiculous.
The only constitutionally valid way of taxing churches would be to tax all nonprofits, which would place undue financial pressure on the 960,000 public charities that aid and enrich US society. If only churches were taxed, government would be treating churches differently, purely because of their religious nature. [20] [21]
No, because of their business nature.
Small churches, already struggling to survive, would be further endangered by a new tax burden. A 2010 survey by the Hartford Institute for Religion Research found that congregations facing financial strain more than doubled to almost 20% in the past decade, with 5% of congregations unlikely to recover. [22] If these churches were obliged to pay taxes, their existence would be threatened and government would thus be impeding religious expression. [20]
In no way does the government NOT subsidizing a religion equal impeding religious expression. If it's that important, and your megachurch closes down, you can meet in a park. The tax is on the land, not the people who worship there.
The vast majority of churches refrain from political campaigning and should not be punished for the actions of the few that are political. The Internal Revenue Code (IRC) gives churches the freedom to either accept a tax benefit and refrain from political campaigning like all other nonprofit charities, or reject the exemption and speak freely about political candidates. [1] [23] There are 450,000 churches in the US, yet only 500 pastors made political statements as part of Pulpit Freedom Sunday on Oct. 2, 2011. [35] [58] The tax exemption should remain in place to benefit the vast majority of churches.
Those 500 should be immediately stripped of their status, but that has only happened a handful of times, and it doesn't change the basic point that tax-exempt status is in and of itself providing support to the church.
Withdrawing the "parsonage exemption" on ministers' housing would cost American clergy members $2.3 billion over five years, [60] which would be a major blow to modestly paid men and women who dedicate their lives to helping people in need. According to the National Association of Church Business Administration (NACBA), the average American pastor with a congregation of 300 people earns less than $28,000 per year. The NACBA also states that one in five pastors takes on a second job to earn extra income, and that only 5% of pastors earn more than $50,000. [59] As stated by D. August Boto, Executive Vice President and General Counsel of the Executive Committee of the Southern Baptist Convention, "the housing allowance is critically important for making ends meet—it is not a luxury." [62]
OK, it would be hard on them, and that sucks, but the goal isn't to make them suffer. Also, there are probably hundreds of thousands of volunteers in America who work a job but dedicate their actual life to improving the lives of others. Do hospice workers get a parsonage exemption? What about the guy who devotes his life to running an AA group, or the Forest Service crew who sit in a lonely tower for hours each day trying to spot fires and prevent towns from being destroyed? None of them are getting rich, but they provide a vital service that in my mind is far greater.
CON Tax Exemption for Churches
Tax exemptions for churches violate the separation of church and state enshrined in the Establishment Clause of the First Amendment of the US Constitution. By providing a financial benefit to religious institutions, government is supporting religion. Associate Justice of the US Supreme court, William O. Douglas, in his dissenting opinion in Walz v. Tax Commission of the City of New York, decided May 4, 1970, stated: "If believers are entitled to public financial support, so are nonbelievers. A believer and nonbeliever under the present law are treated differently because of the articles of their faith… I conclude that this tax exemption is unconstitutional." [24]
Yes, exactly. I don't even feel the need to respond to the rest of the Pro-points. But, you know me.
A tax exemption is a privilege, not a right. Governments have traditionally granted this privilege to churches because of the positive contribution they are presumed to make to the community, but there is no such provision in the US Constitution. [25]
And it wasn't even a law until a 1894...certainly not in the Constitution, or more accurately, an Amendment modifying the First Amendment.
Churches receive special treatment from the IRS beyond what other nonprofits receive, and such favoritism is unconstitutional. While secular charities are compelled to report their income and financial structure to the IRS using Form 990 (Return of Organization Exempt From Income Tax), churches are granted automatic exemption from federal income tax without having to file a tax return. [1]
So, not only exemption, but no time spent on paperwork...so an added benefit. Why can't I call myself a church? I have a fairly unique set of beliefs.
A tax break for churches forces all American taxpayers to support religion, even if they oppose some or all religious doctrines. As Mark Twain argued: "no church property is taxed and so the infidel and the atheist and the man without religion are taxed to make up the deficit in the public income thus caused." [26]
Yep.
A tax exemption is a form of subsidy, and the Constitution bars government from subsidizing religion. William H. Rehnquist, then-Chief Justice of the US Supreme Court, declared on behalf of a unanimous court in Regan v. Taxation with Representation (1983): "Both tax exemptions and tax deductibility are a form of subsidy that is administered through the tax system. A tax exemption has much the same effect as a cash grant to the organization of the amount of tax it would have to pay on its income." [27]
Precisely.
The tax code makes no distinction between authentic religions and fraudulent startup "faiths," which benefit at taxpayers' expense. In spring 2010, Oklahoma awarded tax exempt status to Satanist group The Church of the IV Majesties. [8] In Mar. 2004, the IRS warned of an increase in schemes that "exploit legitimate laws to establish sham one-person, nonprofit religious corporations" charging $1,000 or more per person to attend "seminars." [28] The Church of Scientology, which TIME Magazine described in May 1991 as a "thriving cult of greed and power" and "a hugely profitable global racket," [29] was granted federal income tax exemption in Oct. 1993. The New York Times reported that this "saved the church tens of millions of dollars in taxes." [30]
With the laws as they are and belief being what it is, I actually have no problem with this. Do Catholic, Baptist, Methodist, Lutheran, Quaker, or any other religion have to PROVE their faith in order to qualify? If the answer is no, then there is no way of determining which faiths are real or not.
Churches serve a religious purpose that does not aid the government, so their tax exemptions are not justified. Tax exemptions to secular nonprofits like hospitals and homeless shelters are justified because such organizations do work that would otherwise fall to government. Churches, while they may undertake charitable work, exist primarily for religious worship and instruction, which the US government is constitutionally prevented from performing. [31]
Also true. I'm OK with supporting their charitable acts, though.
Exempting churches from taxation costs the government billions of dollars in lost revenue, which it cannot afford, especially in tough economic times. According to former White House senior policy analyst Jeff Schweitzer, PhD, US churches own $300-$500 billion in untaxed property. [9] New York's nonpartisan Independent Budget Office determined in July 2011 that New York City alone loses $627 million in property tax revenue. [11] Lakewood Church, a "megachurch" in Houston, TX, earns $75 million in annual untaxed revenue, and the Church of Scientology's annual income exceeds $500 million. [32] [33]
Yep, math doesn't lie.
Despite the 1954 law banning political campaigning by tax-exempt groups, many churches are clearly political and therefore should not be receiving tax exemptions. [9] [34] Every fall, the Alliance Defense Fund, a Christian legal group, organizes "Pulpit Freedom Sunday," encouraging pastors to defy IRS rules by endorsing candidates from the pulpit. More than 500 pastors participated in Oct. 2011, yet none lost their churches' exemption status. [35] In Oct. 2010, Minnesota pastor Brad Brandon of Berean Bible Baptist Church endorsed several Republican candidates and dared the "liberal media" to file complaints with the IRS. Brandon later announced on his radio program: "I'm going to explain to you what happened… Nothing happened." [35]
This should be a moot point, since the exemption shouldn't be there at all (at least in its current form), but hell yes. They explicitly and defiantly violated the rules -- and celebrated that fact, and yet, nothing happened.
American taxpayers are supporting the extravagant lifestyles of wealthy pastors, whose lavish "megachurches" accumulate millions of tax-free dollars every year. US Senator Chuck Grassley, MA (R-IA) launched an investigation into these groups in Nov. 2007 after receiving complaints of church revenue being used to buy pastors private jets, Rolls Royce cars, multimillion-dollar homes, trips to Hawaii and Fiji, and in one case, a $23,000, marble-topped chest of drawers installed in the 150,000 square foot headquarters of Joyce Meyer Ministries in Fenton, Missouri. [36]
They are in the minority, but this is undeniable.
The tax break given to churches restricts their freedom of speech because it deters pastors from speaking out for or against political candidates. [1] As argued by Rev. Carl Gregg, pastor of Maryland's Broadview Church, "when Christians speak, we shouldn't have to worry about whether we are biting the hand that feeds us because we shouldn't be fed from Caesar/Uncle Sam in the first place." [37]
This is a really fascinating argument. And it's completely true. I am going to think about this and may post more later. I really never thought about it in this way, mostly because of the Pulpit-Free robbers mentioned above.
The "parsonage exemption" on ministers' homes makes already-wealthy pastors even richer at taxpayers' expense. The average annual salary for senior pastors with congregations of 2,000 or more is $147,000, with some earning up to $400,000. [61] In addition to the federal exemption on housing expenses enjoyed by these ministers, they often pay zero dollars in state property tax. Church leaders Creflo and Taffi Dollar of World Changers Church International had three tax-free parsonages: a million-dollar mansion in Atlanta, GA, a two-million-dollar mansion in Fayetteville, GA, [63] and a $2.5 million Manhattan apartment. [64] Kenneth and Gloria Copeland, leaders of Kenneth Copeland Ministries in Fort Worth, TX, live in a church-owned, tax-free $6.2 million lakefront parsonage. [62]
I don't like making the case about the most affluent of pastors, but this is also undeniably true.
