Thursday, January 27, 2011

More on IRS Ecclesiology

Discussion continues at Scott Wells' blog about churches and IRS status, in light of the agency's ruling that stripped a virtual organization of its church status.

As I noted in the update to my earlier post spinning off of Scott's, another commenter points out the possibility that churches could be simply lumped with all nonprofits, avoiding the separate classification.

So why is there a separate category for churches from other nonprofits? Forget my earlier suggestion about taxing churches; why isn't it sufficient simply to treat all nonprofits the same, including churches?

Two tentative answers I can imagine are that

1) Churches would then have to file form 990 reports on revenues and expenses, including the top 5 highest-paid employees, which they don't now.

So what? (Other than political backlash.)

2) They might have to justify other kinds of expenses -- yet I'm not so sure that's true.

But in fact, I'm asking this question in genuine ignorance.



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