Are You Tax Exempt?

Tax exemption is accorded to church organizations that fulfill the criteria of the Internal Revenue Code. Income tax exemption will be available to churches, and associations of churches under IRC §501(c)(3). The church must  follow the complex IRS rules and the activities as a whole must be:

1. religious,
2. not for the profit of their members, and
3. not be prohibited political activities.
   

Churches, and religious organizations need legal advice from a nonprofit lawyer to obtain and protect not-for-profit status.

Advantages of Tax Exemption

Gifts to churches are deductible by the taxpayer donor. This is a big incentive for church members and others to generously contribute to your church.

Churches are exempt from Federal and State Gift Tax and Estate Tax. This enables members to leave gifts for the church upon their passing.

State and Municipal property tax and sales, gift and inheritance tax exemptions are given to  churches. This saves money in operating the church particularly in high tax states and cities.

Advantages for Pastors

Ministers may be exempt from Self-Employment (Social Security) Tax.

Use of the Parsonage and expenses may be excluded from the pastor’s income.

Ronald J. Cappuccio, J.D., LL.M.(Tax)
Counsellor at Law
1800 Chapel Avenue West
Suite 128
Cherry Hill, NJ 08002
856-665-2121