Tax Guide for Churches & Religious Organizations

Tax-Exempt Status
Churches and religious organizations, like many other charitable organizations,
qualify for exemption from federal income tax under IRC Section 501(c)(3) and are
generally eligible to receive tax-deductible contributions. To qualify for tax-exempt
status, the organization must meet the following requirements (covered in greater
detail throughout this publication):
n the organization must be organized and operated exclusively for religious,
educational, scientific or other charitable purposes;
n net earnings may not inure to the benefit of any private individual or shareholder;
n no substantial part of its activity may be attempting to influence legislation;
n the organization may not intervene in political campaigns; and
n the organization’s purposes and activities may not be illegal or violate
fundamental public policy.
Recognition of Tax-Exempt Status
Automatic Exemption for Churches
Churches that meet the requirements of IRC Section 501(c)(3) are automatically
considered tax exempt and are not required to apply for and obtain recognition of
tax-exempt status from the IRS.
Although there is no requirement to do so, many churches seek recognition of
tax-exempt status from the IRS because this recognition assures church leaders,
members and contributors that the church is recognized as exempt and qualifies
for related tax benefits. For example, contributors to a church that has been
recognized as tax exempt would know that their contributions generally are


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