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The Business Of Religion

RollsSantaMonica.jpg

How about if you're free to practice your religion if I'm free not to pay for it? Go ahead, buy yourself a private jet on your congregation's donations. Gold toilet seats? No, heated gold toilet seats...you go, guy! What I object to is the fact that it's all tax deductible. Jenny Jarville writes for the LA Times:

Creflo A. Dollar, senior pastor of World Changers Church International, preaches that God will reward the faithful with material riches. It is a gospel that has won the flamboyant preacher a 25,000-strong congregation -- and a Rolls-Royce, a multimillion-dollar mansion and a private Gulfstream III jet.

Now a Senate committee is investigating whether Dollar and leaders of several other mega-churches have illegally used donations to fund opulent lifestyles.

In a move that some contend could violate the separation of church and state, Sen. Charles E. Grassley (R-Iowa), ranking member of the Senate Finance Committee, has sent letters to six high-profile mega-churches, including Dollar's in College Park, Ga., requesting that they hand over records of salaries, expense accounts, credit cards, cars and airplanes.

"Jesus came into the city of Jerusalem on a donkey," Grassley said in a telephone interview. "Do these ministers really need Bentleys and Rolls-Royces to spread the Gospel?"

Grassley has some specific concerns. For example, he wants Paula and Randy White, pastors of the Without Walls International Church in Tampa, Fla., to document any tax-exempt cosmetic surgery. And he wants Joyce Meyer, who runs Joyce Meyer Ministries from Fenton, Mo., to explain the tax-exempt purpose of a $23,000 "commode with marble top."

..."I have a constitutional responsibility to see that taxes are being enforced," Grassley said. "Churches are no different to other nonprofit groups -- they have to abide by tax rules."

Part of the difficulty, observers say, is that tax rules have not caught up with the fact that many ministries across the U.S. now operate as corporations. Mega-church pastors run multimillion-dollar enterprises, selling not just Bibles, DVDs and paintings, but gym memberships, nutrition classes and the use of banquet facilities. Some refer to themselves not just as pastors but as CEOs.

"They are taking market principles, setting themselves up as corporations, and yet they don't want to be taxed -- they don't want to have accountability," said Fredrick Harris, a professor of political science at Columbia University. "They are blurring the line between profit and nonprofit."

Though most nonprofits have to file IRS 990 forms detailing salary and expenses, religious organizations are exempt. The Internal Revenue Service requires that ministers' compensation be "reasonable" -- that pastors do not gain excessive compensation from tax-exempt work.

Mega-church followers say those who criticize their pastors' perks do not understand their symbolic value.

"Yes, a minister turns heads when he drives a Bentley," said Democratic state Rep. Randal Mangham, a member of New Birth Missionary Baptist Church in Lithonia, Ga., one of the ministries being investigated. "But that's good. It's important for kids to see you don't have to sell drugs to drive a nice car."

Connie Cotton, 41, a longtime member of World Changers, said, "We give to our pastor because he's a true man of God. He needs a jet to go around the world and preach the Gospel."

...At a bus stop across the highway, homemaker Carrie Roberts, 29, said she had no problem with her pastor driving a Rolls-Royce.

"He's a businessman," she shrugged.

Indeed he is. And we haven't even gotten into all the property taxes all these churches aren't paying.

Here's the IRS on charitable organizations. As opposed to "charitable" ones.

Posted by aalkon at November 18, 2007 11:25 AM

Comments

If they are not paying tax, then it is legal to pull them to court.Why do u have to comment on their life styles?It is just an baseless allegation.

2000 years back donkeys are worth of owning a jet today. Can you imagine what will be the value of rolls-royce after 1000 years or say hundred years from now?

Dont think, you have bit of idea, how their churches are changing people's lives in the third world. Why dont you criticize about the plight of women in the middle east or try criticizing islam?

Posted by: pras at November 18, 2007 2:46 AM

pras,

The lifestyles are the point. It's not that these people are getting paid a $20M salary and not paying taxes on it - it's that they are claiming a $20,000 salary and living a $20M lifestyle, but claiming that all the rest of that spending is church spending that isn't taxable. Can you imagine if Donald Trump (without changing his lifestyle) suddenly announced that the vast majority of his income was tax-exempt, because all of his business profits are really donations to the Church of Trumpery?

And don't you think that FAR more could be done to improve the plight of people in the Third World if some of these "ministers" bought $2,000 toilet seats rather than $25,000 ones, and used the remaining $23,000 to actually HELP PEOPLE?

Posted by: jenl1625 at November 18, 2007 5:56 AM

Funny how taxes themselves don't come in for any criticism. Just sayin'. People are spending their money on what they want, the Bentley and Gold Hopper Seat industries are moving product, what's the hassle?

Where does this notion come from that anyone who finds a nickel is obligated to run turn it in at the nearest IRS branch to make sure someone else doesn't "need" it more? Yes, a certain level of taxation is necessary to society and the wealthy have an obligation to the poor (but it is a moral obligation, not necessarily a legally enforceable one) but in general, profits are good, taxes are bad.

Posted by: martin at November 18, 2007 6:57 AM

Funny how taxes themselves don't come in for any criticism.

I'm for small government, and fewer taxes (for example, all but the dirt-poor should pay for their children to go to school, and NPR should not be paid for with tax dollars), but if my income is taxed, causing me to be able to afford fewer gold toilet seats, people in the business of religion should be taxed, too.

Posted by: Amy Alkon at November 18, 2007 8:00 AM

Why dont you criticize about the plight of women in the middle east or try criticizing islam

Uh...I do. Uh...constantly.

For example, yesterday's post:

http://www.advicegoddess.com/archives/2007/11/dont_get_gangra.html

Pras, you throw around assumptions like the Mets in spring training throw around baseballs.

Suggestion: read and think before you post.

Posted by: Amy Alkon at November 18, 2007 8:04 AM

The thing that is most interesting to me about the leaders of these mega churches is that they can get away with damn near any scam or impropriety and be forgiven by the parishioners who fund their lavish heated golden toilet seats or meth-addled hotel room trysts with gay hookers, as long as they do they teary-eyed public mea culpa. Suckers.

Grassley is right to go after these people. Churches get all sorts of special treatment from the government. Even here in godless, liberal San Francisco, they get special street parking on Sundays, blocking driving lanes of major streets for blocks (My religion requires morning surfing sessions? Can I be excused from work, please?). Churches need to justify their special status by doing good works; if they're going to be run like businesses, they should be treated like businesses.

Posted by: justin case at November 18, 2007 10:12 AM

Creflo A. Dollar

Names as destiny.

Posted by: justin case at November 18, 2007 10:17 AM

Even here in godless, liberal San Francisco, they get special street parking on Sundays, blocking driving lanes of major streets for blocks

Then there are prohibitions against liquor sales on Sundays.

Posted by: Amy Alkon at November 18, 2007 10:27 AM

I'm glad Sen. Grassley is finally addressing this, but wonder what took him so long.

Posted by: Doobie at November 18, 2007 11:42 AM

Lenny Bruce had a great series of commentaries about this same situation 40 years ago, mostly centered around the vast wealth of the Catholic church.

Or how about the great scene with Max Von Sydow in the Woody Allen film Hannah and Her Sisters? "... and the televangelists! It's always the money, the money, the money. If Jesus came down today and saw what was going on in his name, He would never stop throwing up."

I think there should be tax exempt organizations, but their detailed books (including the balance sheet) should be open to public scrutiny.

Posted by: eric at November 18, 2007 1:49 PM

"If Jesus came down today and saw what was going on in his name, He would never stop throwing up."

Too funny!

I can't believe I actually agree with a Republican lawmaker! I'm willing to go even further. I think non-profits claiming exemption as a religion should be held to a higher standard, because "religion" can be so subjective. If an organization is going to claim special exemption as a religion, they should be held to more scrutiny to ensure abuse of our tax laws is not taking place.

Posted by: fft5305 at November 18, 2007 7:03 PM

> their detailed books (including
> the balance sheet) should be
>open to public scrutiny

That's a brilliant idea. A fair trade for tax exemption: What are you doing with the money?

Posted by: Crid at November 18, 2007 7:12 PM

I should have added to my comment above that I don't really care whether they're buying $25,000 toilet seats (haven't used one, so as far as I know they could be worth it . . . .).

And I do think that taxes should be far lower.

But I also think that taxes *could* be lower if people who ought to be paying a lot of taxes weren't able to dodge those taxes through a phony tax exemption.

Sure, it would be better if our government spent less and therefore taxed all of us less. In the meantime, why should my honestly-paid taxes be higher than necessary because a guy with $25,000 toilet seats has managed to weasel out of paying his?

Posted by: jenl1625 at November 19, 2007 5:29 AM

In the meantime, why should my honestly-paid taxes be higher than necessary because a guy with $25,000 toilet seats has managed to weasel out of paying his?

Exactly!!!

Posted by: Flynne at November 19, 2007 5:55 AM

If an organization is going to claim special exemption as a religion, they should be held to more scrutiny to ensure abuse of our tax laws is not taking place.

I'm with you on this, too. The rest of us shouldn't be forced to pay, but if we are, we deserve to see what we're getting -- and what they are, and to judge whether the church business has mainly become conspicuous consumption.

Posted by: Amy Alkon at November 19, 2007 7:03 AM

The laws of Economics are always available and there is hardly ever a line. If you want less of something, tax it. It just might be that asking churches, of whatever form, to pay taxes on their transactions would reduce some of the negative aspects of organized religion and I'd be onboard with that, except:

This zero sum notion that if churches had to pay taxes, the rest of us might get to pay less is, sorry, laughable. Government has an insatiable appetite for tax revenues. If the historically tax-exempt component of the classical "estates" (church, nobles, commons)were to become liable for fealty to the IRS (Inland Revenue etc.) then watch for two things:
First, there would be less of what the church arguably does do well in giving people a place to offer financial or in-kind charity close to home or at least where they can see the recipients. Those who willingly attend church just might be delusional etc. but they know they get to shelter some of their money from the taxman by giving it to the church and if they can personally stand that, who are we to say they are stupider than the guy who blows it at the casino?
Secondly,(this is a dynamic thing so stay with me) the gubmint, will have to pick up whatever efforts the churches no longer take care of; the tidal wave of currency expected from taxing churches will be more of a ripple since the chumps in the pews were only buying gold toilet seats because they liked their pastor better than the taxman; and the IRS/IR etc. will have to ask the smart people who worship BradGelina or their Pomeranian to produce the difference. Oops.

Wealth, follow this, ONLY comes from productivity. The guy who made the Bentley or the toilet seat created something of value (I guess.) Whether their goods are bought by a "real" CEO or an obnoxious TV preacher or a guy who forged 300 credit card applications doesn't matter at all.

Posted by: martin at November 19, 2007 7:47 AM

Martin, I'm not talking about taxing the church. I'm talking about the "pastor"/CEO evading his personal income taxes.

If a pastor/CEO is claiming only $50K in salary (just as an example) and not declaring as income the fact that the church has provided him with a home, a vacation home, a car, and a private jet, there's a valid question of whether he personally is evading his income taxes. But when the question is raised, the defense is that it's a church providing the compensation - so what? Whether it's a church or a zoo or an S&M club, the issue is whether the employee is reporting taxes.

The other part of the equation is that churchs themselves get tax exemptions because (as you pointed out) the power to tax is the power to destroy. But there are rules around that tax exemption. Get up there and preach all you want about anything you want - but when your "sermon" is "vote for McCain", then you're engaging in politics, not religion. And when you start trying to sweep the profits from your church-owned store, gym, and video arcade under the religious tax exemption, it's entirely fair to examine the financial records and see whether the rules were followed.

And yes, in the real world, these people properly paying their taxes wouldn't make a substantial difference in my annual return. So what? That does not make it okay for a *pastor* to engage in criminal tax evasion. That doesn't make it okay for a *church* to engage in morally ambiguous accounting tricks in order to save itself a few bucks.

Posted by: jenl1625 at November 19, 2007 9:26 AM

"Pras, you throw around assumptions like the Mets in spring training throw around baseballs."

Holy shit! A sports metaphor from the Goddess! Truly the End of Days are upon us.

Some clarifications needed here - while its true that Churches aren't required to file typical tax returns, they ARE required to file returns that document employee salaries and income produced by non-charitable businesses under church control (technical term is "Unrelated Business Income"). So the church IS providing a record relating to most of the abuses described above that can be questioned. Also, most state attorney generals are in charge of monitoring non-profit organizations and ensuring they adhere to their stated goals. The problem is simply too many bad guys, not enough auditors.

The truth is, this article might just as well be about your neighbor who operates the cash-only locksmith business and has a $1.5 million home in Bel Air. Yes, its frustrating when bad people get away with stuff - but these churches are just one species of tax cheat.

Posted by: snakeman99 at November 19, 2007 9:26 AM

> Whether their goods are bought
> by a "real" CEO or an obnoxious
> TV preacher or a guy who forged
> 300 credit card applications
> doesn't matter

I'm pretty sure that's true, and that it can be carried a little further (or farther, I've never know the difference)... It's very hard to tell whether wealth has been created when matters of taste are involved. I think country music is tragic assault on the human spirit, but some people make money from it.

> the church IS providing a
> record relating to most of
> the abuses described above
> that can be questioned.

Good to know, but Eric said "open to public scrutiny ." To me that means taxpayers (who toil on your behalf) should be able to walk in and sniff around as they see fit, not just the regulatory agencies. If you get a free ride, you have to travel around with your tits out.

Posted by: Crid at November 19, 2007 10:27 AM

"To me that means taxpayers (who toil on your behalf) should be able to walk in and sniff around as they see fit, not just the regulatory agencies."

Try guidestar.com. Free account sign-up entitles you to view IRS Forms 990 for any tax-exempt organization that files them. Admittedly, it won't have any for those churches who claim exemption, but you will often find returns for their related organizations. For example a search for "World Changers" does confirm that "World Changers Church International" does not file Forms 990, however several variants with similar names turn up that do. Not sure how (or if) any of these are related structurally, but its a good place to start any investigation of any tax-exempt organization.

Posted by: snakeman99 at November 19, 2007 10:56 AM

"while its true that Churches aren't required to file typical tax returns, they ARE required to file returns that document employee salaries and income produced by non-charitable businesses under church control"

Are these documents sufficient to figure out whether the pastor and other church employees are reporting ALL of their compensation or merely what's labeled as salary? If the pastor has a home (or multiple homes) paid for by the church, and has a car paid for by the church, and has a jet paid for by the church, and can have the church pay for a home remodel or redecorate, then the value of all of those things should be included as part of the stated compensation, and taxes must be paid on all of it.

If I did still attend church, I'd be VERY disturbed if I thought my pastor were evading his taxes. (Render unto Caesar, anyone?) Then again, some of these congregations seem entirely willing to forgive their pastors for anything, up to and including sexual assault.

Posted by: jenl1625 at November 19, 2007 11:32 AM

"If the pastor has a home (or multiple homes) paid for by the church, and has a car paid for by the church, and has a jet paid for by the church, and can have the church pay for a home remodel or redecorate, then the value of all of those things should be included as part of the stated compensation, and taxes must be paid on all of it."

Jen, these facts would all go to the "(un)reasonableness" of the pastor's salary, which, as you note, should be taxable if discovered. Sadly, this problem is not limited to churches. This is just another version of the vanilla corporate fraud that occurs in the for-profit world. In fact, because most tax returns are protected from discovery in civil litigation, the (non-church) non-profits are actually more transparent. Again, this gets back to the question of why churches are treated preferentially as opposed to other non-profits. To that, I have no answer.

Posted by: snakeman99 at November 19, 2007 11:48 AM

Reading this post made me think of a comic I saw the other day over at "The Pain". Let me know what you think

Jesus Vs. JEEZUS!

http://www.thepaincomics.com/

Posted by: RedPretzel in LA at November 19, 2007 1:56 PM

Posted by: RedPretzel in LA at November 19, 2007 1:58 PM

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