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JLeslie's avatar

Is it true that if churches paid taxes Americans would only have to pay 3% income tax?

Asked by JLeslie (65564points) July 19th, 2018 from iPhone

I just saw this going around on Facebook.

What if it is true?

What do you think would happen if churches had to pay taxes? What would change?

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26 Answers

MrGrimm888's avatar

What would change, if churches paid taxes?
They would actually deserve having the fire department risk their lives, for putting out church fires…

elbanditoroso's avatar

If churches had to pay taxes, 90% of them would close. (not necessarily a bad thing).

Most of them don’t have enough income (contributions, gift shop sales, rental for weddings) to pay the bills as it is today. Many churches are closing because they can’t pay their mortgage or their power bill. So if you throw taxes on top of that, they’re bankrupt.

Except for the 20,000 member mega-churches which are rolling in dough.

chyna's avatar

Everything you read on Facebook is not true.

Tropical_Willie's avatar

Here’s the math for taxing churches @JLeslie

I second the “don’t believe what you see on FB.”

Call_Me_Jay's avatar

Ask the people who make the claim. Let them back up their beliefs, tell them to do their homework.

stanleybmanly's avatar

the claim is preposterous.

Dutchess_III's avatar

I doubt it.

KNOWITALL's avatar

In my area, it’s very possible that it would be a SIGNIFICANT reduction for us, if they paid their share. I heard around $71 billion a year is the estimated total subsidy.

In case you’re curious why:
There is said to be an old Arabian proverb: “If the camel once gets his nose in the tent, his body will soon follow.” This expression is especially pertinent in the tax exemption context. Churches are tax exempt under the principle that there is no surer way to destroy the free exercise of religion than to tax it. If the government is allowed to tax churches (or to condition a tax exemption on a church refraining from the free exercise of religion), the camel’s nose is under the tent, and its body is sure to follow. But that’s not just my opinion; it’s the understanding of the U.S. Supreme Court.

notnotnotnot's avatar

Here is a response to the meme.

“To sum up — no, taxing churches would not mean you’d only have to pay 3% taxes. If a law were somehow drafted that separated churches from nonprofits, and no churches were able to figure out a way to claim nonprofit status, AND many churches didn’t go bankrupt from the new tax rules, AND people kept giving to churches in the same amount once their donations were no longer deductible… everyone would still pay pretty much the same amount they do today.”

Dutchess_III's avatar

Taxing them would destroy the free exercise of religion? Why?

imrainmaker's avatar

I think this is too much exaggeration. I don’t see why they can’t be taxed though if they’re making good money and contribute to the society? Those who aren’t doing good financially can be spared.

Dutchess_III's avatar

I agree. The mega churches making millions should be taxed.

The problem, though, does that give them a say in our government policy?

stanleybmanly's avatar

I bet it isnt so much the income tax as the property tax situation where churches offload the burden to the general public. The real estate holdings of the Catholic church in any major city in this country must be enormous. Yet I don’t think it’s a good idea to tax the churches, particularly since we live in an era of such a marked decline in church attendance.

elbanditoroso's avatar

In my upper-middle class neighborhood, there are 9 churches within a one-mile radius, and one under construction. None of them are megachurches. Each of them has at least 2–3 acres of land; a couple of them far more than that – 6–7 acres or more.

One of them is an older brick church that has been around for 60 years. The others (except for the one being built) : One is two years old, and the rest are between 9–12 years old. At least three of them are Baptist, one methodist, one Lutheran, one Church of Christ, and a couple that I am not sure of.

Let’s say that combined, they are around 40 acres of land. Around here, land in the burbs is selling for approximately $10000/acre, depending on specifics. Add the improvements (i.e. the buildings and you’re talking, collectively, about probably $30–35 million for the improved property and land.

They don’t pay a cent in tax. Yet they have street frontage, police and fire protection, etc. (they do pay their own water and sewage bills).

If there is a fire at the Church of Blah Blah, it gets put out, of course. But who pays county tax for fire services? I do. Not them.

I think that the proper thing to do is have churches pay taxes for the county and city services that they receive.

Dutchess_III's avatar

I’m sure they have utility bills they have to pay and such.

elbanditoroso's avatar

@Dutchess_III sure, but those are to private companies, not the county.

Dutchess_III's avatar

Well…not here. We pay to the city. But you may well be right for other areas.
Isn’t that what property tax is for? To pay for the county services?

elbanditoroso's avatar

Here, property tax pays for
-roads, maintenance, traffic lights
-police and sheriff (different departments)
-snow removal (which in Georgia is rare)
-schools (most if it)
-Public health department
-County Jail

Water, electricity, trash, natural gas – are all private companies

Dutchess_III's avatar

Road and bridge
Seems like when I lived in Wichita we paid a private company for our trash removal.

MrGrimm888's avatar

Well. Will wonders never cease. I am going to back religion here…

@KNOWITALL . You brought up a point I had not considered. I wouldn’t be a fan of a sudden high tax on organized religions. Our government often taxes things it realizes are necessary, or habitual.

I do think that churches should have their donations audited, and have a percentage taken though. Like I said about fire departments. They *churches/religious structures, * get the benefits of a tax paying citizen, without paying for it.
One could say that religion is on welfare.

JLeslie's avatar

I’m on the fence about taxing church income or property. I’ve always thought it would be great to start a religion and live tax free.

Do churches have to report their income and expenditures like a business? I’m guessing not. I would want to know the financials of the church I was going to. How much the clergy are paid, etc.

MrGrimm888's avatar

The NFL doesn’t pay taxes. It makes billions of dollars….

MollyMcGuire's avatar

No. You can pretty much assume anything “going around Facebook” is not true.

JLeslie's avatar

@MrGrimm888 The NFL doesn’t pay taxes? Is it nonprofit? Taxes are paid via the income the players make and salaries for those who work there. Is there no property taxes paid for the stadiums? Plus, sales tax is paid in items sold in the stadiums.

MrGrimm888's avatar

I’m not an accountant. But the league doesn’t pay taxes on it’s revenue. It’s from when the league was very young, and wasn’t very profitable.
This last year, I thing revenue was over $8 billion.

MollyMcGuire's avatar

Property tax is a state/local tax and exemptions differ among the states and localities.

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