Don't Mess With Taxes

Do you know who owns the shopping center where you spent part of Black Friday? It might be a church.

A story in today's New York Times notes that Megachurches Add Local Economy to Their Mission:

"An analysis by The New York Times of the online public records of just over 1,300 of these giant churches shows that their business interests are as varied as basketball schools, aviation subsidiaries, investment partnerships and a limousine service.

At least 10 own and operate shopping centers, and some financially formidable congregations are adding residential developments to their holdings. …

But the entrepreneurial activities of churches pose questions for their communities that do not arise with secular development."

Rendering unto Caesar or not: One of the key questions is taxation.

As the story points out, "Mixed-use projects, like shopping centers that also include church buildings, can make it difficult to determine what constitutes tax-exempt ministry work, which is granted exemptions from property and unemployment taxes, and what is taxable commerce."

The reporters talked to the business manager of a Charlotte, N.C., church that formed a for-profit property management unit for its commercial holdings. But he admits there still is some imprecision in deciding where tax-exempt church work ends and taxable commerce begins, or vice versa.

"What’s a poor tax assessor to do?" asks the story.

The equity issue: In an earlier post on this topic (Holy taxation!), I opined that a church-affiliated operation shouldn't get a tax break that an identical nonreligious one doesn't. A church's nonreligious endeavors should be treated like any other business, taxes and all.

I'll reiterate it here. Using the church as a flimsy facade for commercial gain is basically tax evasion.

Collecting taxes on church-owned enterprises that are in reality secular programs is only fair. And it in no way impedes a religious group's Constitutional right of worshiping its chosen deity in truly spiritual, and appropriately tax-exempt, ways.

You can read the full NYT story on church businesses here. The tax issues are examined on page 2. And be sure to check out the graphic showing where the country's 1,300+ megachurches are located.