Should Christian Non-profits Consider Giving up their Tax Exempt 501(c)3 Status?
|November 16, 2009||Posted by Anthony under Blog, Christianity and Culture, General, Holocaust, human rights, morality, politics, theology|
The keyword in the title is consider.
I don’t want anyone thinking that I believe in every case it would be desirable or necessary. I do think, however, that accepting the status quo without persistent reflection is dangerous in general. Just because it has ‘always’ been this way doesn’t mean it should continue to be that way. After all, the whole notion of the 501(c)3 didn’t come until the 1950′s. There were many centuries prior to that when things were not ‘always done this way.’
For the record, the ministry of this website, Athanatos Christian Ministries, is a registered non-profit but is not tax exempt. I envision it always being that way but would not rule out obtaining that status in the future: more evidence I am not categorically condemning tax exemption.
There are two general reasons why I think organizations should consider giving up their tax exemption. The first is the most obvious. Tax exemption currently comes with some strings attached. Essentially, while you can speak about issues, your organization is supposed to refrain from overt endorsements of specific individuals. Failure to abide by this means the lifting of your tax exemption status.
It is true that this is very rare, but that is only because many churches try to abide by the law on this point. The Government helps by keeping the financial carrot close by; the stick is rarely necessary.
The main question we need to ask is whether or not, and to what degree, should the Christian Church ever adjust its message for anything, let alone the Government.
But surely it will be pointed out that Jesus said “render unto Caesar what is Caesar’s and to God what is God’s.” Yes, there is no question that God has appointed the government to handle certain duties (Romans 13) and there is no warrant anywhere for the Church to take those on. Indeed, we Christians are to submit to these authorities. It does not follow, however, that the Church can ever subvert its mission and message, even if the authorities say you must. Moreover, Matthew 22 (the passage alluded to above) explicitly states that people of faith ought to pay taxes if Caesar so requires it.
So, one day Caesar gets the idea that he won’t require people of faith to pay taxes if only they will follow certain rules…
Christians went for it.
But surely the Church has no business messing with politics? Surely one can believe anything they want on ‘spiritual’ matters and vote however they please on ‘political’ matters? Surely the Christian is permitted to break his being up into little compartments and act differently depending on which compartment he is in? I think not.
It is a dangerous fallacy to assert that the Gospel has no bearing on what happens in society. At worst, it is a form of gnosticism, reducing the Gospel to ‘spiritual’ topics of esoteric importance as though the physical world is unreal and unimportant. The Incarnation is proof otherwise.
It may be argued that the tax exemption limitations are not unreasonable, because it still allows Christian organizations to faithfully speak out on issues- there is no need to single out individuals or overtly align with ‘political’ platforms.
Maybe. What if it was Hitler? Does ‘Render unto Caesar’ still apply?
Some Christians will still say ‘yes.’ Citing Romans 13, they would insist that we should always submit to the Government- until the point ‘spiritual’ affairs are infringed, of course- and never resist. One hopes that even if they wouldn’t physically oppose the likes of Hitler, they would at least preach out against him. But even doing that shows that yes, indeed, there is a point where we can rightly single out individuals.
If an appeal to common morality weren’t enough, we do have the witness of Scriptures, where it is abundantly clear that ‘Render unto Caesar’ definitely does not mean ‘Never speak badly of individuals.’ For example, the prophet Nathan confronted David face to face. In the New Testament, we see John the Baptist openly condemn Herod.
I’m asking, simply, for churches to consider if their mission is being dampened by Caesar’s restrictions. If it was, I am convinced many churches would make changed… if they even bothered to examine that matter, which is all I’m proposing.
While I don’t know if tax exemption is even the main reason, I think that the Christian Church in America has definitely been soft for several generations at least. It may be that the Gospel has been promoted without compromise, but only in the narrowest sense of the term. Fear that the Church might lose substantial funds if they don’t ‘mind their own business’ I think is part of that, one way or the other. That isn’t necessarily tied to tax exemption. I think also Congregations have shied away from tough topics out of fear that people will walk away- with their dollars.
The second reason I think organizations should consider abandoning their tax exemption status relates to the ‘compartmentalization’/gnosticism issue.
A church, like many organizations, exhibits many of the characteristics of ‘businesses.’ We often think of a non-profit as ‘not being about profit’ but in fact the only difference is that the profit goes to the furtherance of the mission rather than to shareholders. Regardless, money comes in and money goes out, and as such obeys laws of economic reality.
However, by being exempted from taxes- an economic reality for most individuals and all businesses, the church is allowed (encouraged, even) to become distant from the impact of economic decisions in the real world.
To help make the point, consider the recent case of the government trying to force nurses in New York to get the swine flu vaccine. Now, if the government was telling you that you had to get the vaccine or else, wouldn’t you be outraged? You’d say something, I bet! In fact, the people who made the most noise were the nurses. Heck, I was outraged by it but you didn’t even hear it from me on this blog! You see, until it affects you, just by human nature, you don’t tend to think about it.
By not paying taxes like everyone else, churches and charitable organizations don’t think about the impact of economic policies that are affecting other folks, in particular business owners, companies, and employers. (The pressures related to rising costs in health care are a rare example where there was a shared understanding of the problem.)
Now, of course the impact is recognized at some level. When giving is down, for example, churches notice. Giving goes down when jobs are lost and wealthier individuals have less to share. But what is missed is the righteous indignation that these people have when the Government considers the public as their personal bank account. Since tax exempt non-profits do not pay taxes, they do not share in the righteous indignation.
At the same time, we recognize the intuitive right of the one affected- the tax payer- to complain about his tax burden (if he so desires). He has a right to lay claim on policy makers as a ‘tax payer.’ Tax exempt non-profits do not have this inherent right, and, sensing that, they stay out of it.
In this way, so many churches that are so quick to jump on ‘injustices’ are unable- just by the nature of things- to recognize other forms of injustices that may be going on all around them. And why not? It isn’t like THEY have to pay taxes, right?
You see what I mean?
You might think of ‘tax exemption’ like a piece of technology. All technology has an effect. It always has an impact of some kind. Likewise, paying taxes has an effect and impact. We do not live in a compartmentalized world, but one effect of tax exemption is to perpetuate the idea that we do…
For these reasons and more, Christian non-profit tax exemptions should consider giving up their tax exempt status. (I’d go into the more, but at 1300 words my readers are sure to complain if I did)