Are religions and church’s tax-exempt every where or just in the U.S.
In many countries in Europe, some churches are tax-supported.
To be tax-exempt in the UK, a church/religion has to be registered as a charity. Some so called religions like Scientology are not charities here. They do have some tax breaks though as a not-for-profit organisation.
Title edited to indicate subject.
Colibri
General Quesitons Moderator
It’s helpful to note what kind of taxes they are exempt from, which is state sales tax and local real estate tax for land in use. And Churches are exempt from corporate income tax (the donations they receive are not taxed). And this is mostly because the government treats Churches as a non-profit corporation. The same rules apply for charities.
Churches must pay all the employer taxes mandated by law for their employees, and the proper withholding for their employees (the overwhelming majority of clergy pay income and social security tax… some exemptions are made for those in a monastery or religious orders who receive no pay per se). Churches must pay tax on unused land.
As moriah said, define tax-exempt. In Spain for example there is an amount of our income tax which gets distributed either to the RCC or to other charitative organizations (the ratio gets determined by the taxpayers’ choice), but neither a Church nor any other charitative organization is exempt from paying VAT or its employees’ Social Security.
Are parishioner’s weekly offerings tax deductible?
Yes, under certain circumstances. It’s considered a charitable contribution and there’s some arcane formula to figure out if you can itemize it as a deductible.
I’d imagine there are a number of ways in which you can document that. Some churches set up a pledge program, and could be asked to provide a verification letter for the IRS. Checks can, of course, be verified. And while it’s likely frowned upon, you could probably ask the church for an end-of-year receipt for an estimated amount of cash offerings.
I doubt such an estimate would satisfy the IRS. Best way is to give in an envelope. Even a check isn’t proof - IRS found that people were paying for a week of church camp for their kids and counting that as a contribution. Most churches routinely send a year-end statement that this was a gift, not buying something. (IRS called a priest - did Jack actually give this much money? - No, but he will!)
Sure. But I’m guessing in many cases that letter would not be presented as “an estimate”, and the IRS wouldn’t be checking up on its validity unless it meets a certain threshold.
To the contrary, if you pay on a designated pledge, you usually get a statement from the parish treasurer at the end of the year documenting its fulfillment (provided, of course, that you have fulfilled the pledge). It is not estimated, the treasurer records the exact amount given (e.g., in my case, what was recieved in Pledge Envelope(s) No. 46) over the year and then sends you a report.
Isn’t that exactly what I said? “Some churches set up a pledge program, and could be asked to provide a verification letter for the IRS.”
I think you’re confusing the three portions of my post. The first deals with pledges. The second deals with checks. The third deals with cash offerings.
Oh, OK. In the case of otherwise unmarked cash as plate offerings, I don’t think many churches would jeopardize their tax-exemption status by estimating those unrecorded amounts.
If one called up and said, “I gave you $5 a week each Sunday, and I’d like a letter attesting to my charitable contribution,” the treasurer would say, “Well, unfortunately we can’t do that. But you can pledge $5 a week going forward and then next year, you’ll have a letter!” Both the IRS (because it produces better documentation) and the parish (because it facilitates financial planning) prefers givers to give in the form of pledges. So if one thinks, “Of course a church will favor a congregant to the IRS and provide a bogus estimate letter,” I think, on reflection, the church’s interest better aligns with denying such an estimate.
Absolutely - that’s most likely what regularly happens. However, I think the church would be being overly cautious (though completely correct in doing so) - since the IRS doesn’t do shit regarding policing churches on complying with 501©(3) regs.
That’s a good point. The IRS considers contributions as something freely given, not something given in return for an item or service of value.
So, if you go to a charitable dinner, whether for your church or local firehouse, you have to deduct a reasonable cost of the dinner from the declared contribution. So, if you paid $100 for a lobster meal, you should knock about $30 from that and only declare $70 in charitable giving.