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Author Topic: Tax advantages given to schools with religious foundings?  (Read 1170 times)

contrarian

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Tax advantages given to schools with religious foundings?
« on: April 01, 2009, 11:28:16 PM »
This is something that's been bothering me for a while, I'm hoping one of you accounting/tax-nerds might have an answer.

Are there any tax-advantages given to schools that have religious foundations over those who do not?  Since churches are tax exempt, whereas private organizations are typically not unless given charitable tax-exempt status,  does this extend to private educational institutions? Or are secular private schools also given tax-exempt status?  For instance, Chicago has six law schools: Loyola, DePaul, NW, UofC, Kent, & JMLS.  The first two both have Roman Catholic affiliations, whereas the latter four have no religious affiliations.  Does this status provide DePaul/Loyola any sort of tax advantage over the other four? Or is it the case that although the latter (and even former) schools are private, they are also given non-profit charitable status due to their educational objective so that they have the same tax status regardless of any religious affiliations.

And I'm not referring to tax-advantages to the consumer/students, but rather to the organization itself in terms of having to pay taxes on property owned, monies received, or 'profits' earned. 

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Re: Tax advantages given to schools with religious foundings?
« Reply #1 on: April 01, 2009, 11:36:48 PM »
If they're non-profit organizations, they're exempt... right?

zachanson

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Re: Tax advantages given to schools with religious foundings?
« Reply #2 on: April 02, 2009, 02:21:19 AM »
why? does it matter  ::)

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Re: Tax advantages given to schools with religious foundings?
« Reply #3 on: April 02, 2009, 09:15:49 AM »
why? does it matter  ::)

Do you really not think that this is an interesting question?
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SamE397

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Re: Tax advantages given to schools with religious foundings?
« Reply #4 on: April 02, 2009, 02:32:37 PM »
I imagine that some religious schools do have tax breaks but the tax breaks would have to do with non-profit status not the fact that they're religious organizations perse. You could definitely have a for profit religious organization. Also, there could definitely be a non-profit private university even though I think most private schools are for profit. I get where you're going but it's a bad question. The question should be is it easier for a religious school to attain non-profit status? My guess would be yes it is easier for them to obtain non-profit status but I'm not sure. Our tax code does benefit religious organizations and those who work for them substantially. I imagine some people may view that as being contradictory to the goal of a secular democracy. I personally don't really care one way or the other. 

 

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Re: Tax advantages given to schools with religious foundings?
« Reply #5 on: April 02, 2009, 02:40:54 PM »
Very few private schools are for profit.

SamE397

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Re: Tax advantages given to schools with religious foundings?
« Reply #6 on: April 02, 2009, 02:58:50 PM »
Very few private schools are for profit.
I'm sure you're right. I'm not an expert on the subject I just know about the few schools I'm personally familiar with.

nealric

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Re: Tax advantages given to schools with religious foundings?
« Reply #7 on: April 02, 2009, 04:18:08 PM »
Universities are usually tax-exempt organizations just the same as religious organizations.

Some of the more whacked out religious organizations (i.e. Bob Jones U.) have lost tax-exempt status due to their ideology.
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contrarian

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Re: Tax advantages given to schools with religious foundings?
« Reply #8 on: April 02, 2009, 06:46:30 PM »
why? does it matter  ::)

It matters because, as an atheist who abhors that religious organizations are tax-exempt, it would be an issue of principal to me if one school was given a financial advantage over another because of its foundations in a mythology.  I'm not, however, entirely disinclined to attend a religious affiliated school so long as they don't infuse their mythology and morality into the curriculum, and that they have a diverse faculty and student body. 

Doing some research, it appears the that universities (at least the ones I looked at) are given tax-exempt status however.


nealric

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Re: Tax advantages given to schools with religious foundings?
« Reply #9 on: April 02, 2009, 07:16:55 PM »
Quote

It matters because, as an atheist who abhors that religious organizations are tax-exempt

I think there are good tax-policy reasons why religious organizations are tax-exempt independent of their status as religions. There are many, many, tax exempt organizations out there with often contradictory policy objectives. I think if you make the policy decision that one non-profit org is tax exempt, you need to apply that status to all of them. The income tax is fundamentally a tax on profits- a group that has none wouldn't pay much tax anyways. You would also into a ton of problems RE business expense deductions if you tried to tax religious orgs. For example, IRC Section 162 sets forth a deduction for "ordinary and necessary" business expenses. You would end up with constitutionally dubious cases where the government had to decide if buying things like holy water are "ordinary and necessary" to the functioning of the church. Therefore, those who support a separation between church and state should support tax-exempt status for religions.

Note that there is a difference between merely tax-exempt organizations and tax-exempt organizations that you get a tax-deduction for donating to. They actually fall under different provisions of the tax code. I think there are better arguments for why religious groups should not receive that status.

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