[Grizzly]

<p>Speaking with some friends in Maine last night.  We mentioned that we rent a hall from a local church to hold our dances in.  Apparently renting space in churches is not allowed in the States because it would ruin the tax exempt status?  They get to use them for free, with a donation from time to time.  Huh?<br><br>
The church here is not for profit, and their books are subject to review, but if they charge for use of their hall it is usually put towards heating and upkeep.  What is wrong with that?  Can a US tax maven help me out here?</p>

 

[jcumming]

<p>Not a tax maven, just a Maven follower </p>
<p> </p>
<p>I know of a few churches in the US where there is a "suggested donation amount" and if you don't agree to the "suggested donation" then they have "another booking" for that time period.</p>

 

[GaReb770]

<p>We permit outside groups to rent the church for meetings, non-member marriages and funerals.  There is a suggested donation at the Pastor's discretion.  It's not a whole lot of money - maybe a couple of thousand each year we take in.  The funds go toward church operations and ministries.</p>

 

[Hairy Trotter]

<br><br><div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>Grizzly</strong> <a href="/forum/thread/72092/tax-exempt-status-for-churches#post_1975545"><img alt="View Post" class="inlineimg" src="/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p><br>
Speaking with some friends in Maine last night.  We mentioned that we rent a hall from a local church to hold our dances in.  Apparently renting space in churches is not allowed in the States because it would ruin the tax exempt status?  They get to use them for free, with a donation from time to time.  Huh?<br><br><br><br>
The church here is not for profit, and their books are subject to review, but if they charge for use of their hall it is usually put towards heating and upkeep.  What is wrong with that?  Can a US tax maven help me out here?</p>
<br></div>
</div>
<br><br><p> </p>
You friends aren't right. Tax-exempt non-profits can rent out their space and such without losing tax-exempt status. Depending on circumstances, they might have to pay tax on that income (it's called the Unrelated Business Income Tax at the federal level). And the hassle involved with reporting that income and paying the tax is probably why some churches say "fuck it" & take the free w/donation approach.

 

[Grizzly]

<p>'s what I thought.  Not as heavy handed bureacratic wise here, but same thing applies.</p>

 

[airehead]

<p>Sounds like a church I would go to.  <br>
 </p>
<p> </p>
<p>Sometimes they loan them out, too, to be a good neighbor.  No cost/donation at all.</p>
<p> </p>
<div class="quote-container"><span>Quote:</span>
<div class="quote-block">Originally Posted by <strong>Hairy Trotter</strong> <a href="/forum/thread/72092/tax-exempt-status-for-churches#post_1975589"><img alt="View Post" class="inlineimg" src="/img/forum/go_quote.gif" style="border:0px solid;"></a><br><br><p>A<br>
 </p>
<br><br><p> </p>
You friends aren't right. Tax-exempt non-profits can rent out their space and such without losing tax-exempt status. Depending on circumstances, they might have to pay tax on that income (it's called the Unrelated Business Income Tax at the federal level). And the hassle involved with reporting that income and paying the tax is probably <strong>why some churches say "fuck it"</strong> & take the free w/donation approach.</div>
</div>
<br><br>

 

[jenna]

<p>Pretty much as long as they're granted 501 3(c) status, and don't do anything stupid with their money, they can keep non-profit status.   If there are tax implications, they just GL the income as Miscellaneous donation income and scoot around the laws. </p>

 

[Grizzly]

<p>Jenna, see, that's the way it is here too.  Different tax codes and numbers, but "don't do anything stooopid".</p>