Reclassification (First Payment)
“Because special tax rules apply to churches, it’s important to distinguish churches from other religious organizations. Therefore, when the IRS uses the term “religious organizations,” it isn’t referring to churches or integrated auxiliaries of churches.” – Internal Revenue Service, Publication 1828
The reasons for reclassification among these dozens of popular religious organizations vary but these three reasons are a common thread:
- They want to operate according to their biblical faith as an organization.
- They want exemptions in the federal tax code that apply only to churches or associations of churches such as mandatory exemption from yearly Form 990 tax-return filing and exemptions from paying into public insurance programs that pay for abortion, contraception, or other medical services to which the organization is conscientiously opposed.
- They want to protect the confidentiality of their donors since 501(c)(3) tax-exempt organizations are required to disclose to the IRS the names and addresses of donors giving over a certain amount in the year.