Mormonism in the Internal Revenue Code

taxWhenever possible on April 15, I like to put together a quick post about some Mormon-related trivia from the tax world. This year’s edition: church financial disclosure.

In brief: tax-exempt organizations by definition don’t pay taxes. Prior to 1943, they also didn’t file any tax returns—they were pretty much entirely outside of the tax regime. That changed with the Revenue Act of 1943, which required tax-exempt organizations to file annual information returns. Broadly speaking, those returns lay out the sources of the organization’s income and where it spends that money.[fn1]

The return-filing requirement continues today, in largely (though not entirely) the same form. And, in marked contrast with most tax returns, the law requires tax-exempt organizations’ returns to be made available for public inspection. (If you want to inspect some, sign up for a free account here and have at it.)  [Read more…]

Does Open Stories Foundation Qualify As Tax-Exempt?

Last week, Peggy Fletcher Stack wrote an article about John Delhin’s finances. A couple things leaped out at me, particularly salient, perhaps, because of research I’ve been doing recently, and because they raise difficult-to-see red flags, both for the Open Stories Foundation (“OSF”) and for other Mormons (or, more generally, Americans) who want to start a tax-exempt organization.[fn1]

Tl;dr: OSF looks like it is violating the prohibition against private inurement, which would compromise its tax-exempt status; it should at the very least get a tax practitioner with experience in the tax-exempt area to look closely. Also, anybody who wants to operate a tax-exempt entity needs to get competent legal advice upfront: the tax-exempt area is a minefield of compliance traps. [Read more…]

Merging Religious and Secular News(papers)

deseret_news_private_collecThe Church News is moving. It has just announced that stories from the Church News will be posted on DeseretNews.com, that LDSChurchNews.com will redirect to the DN site, and that eventually the archives will be moved as well.

Which is fine and good, I suppose. Apparently, the Church News was hosted on a platform that couldn’t be supported or upgraded.[fn1] So the consolidation seems to make sense from a technical point of view.  [Read more…]

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