Must churches obtain official 501(c)(3) status from the Internal Revenue Service to be exempt from taxation?
No, churches are automatically exempt from taxation, according to attorney Marcus Owens, Washington, D.C., a former head of the IRS’ tax-exempt division, now defending a California church against the IRS (see related story on right).
Must churches be 501(c)(3) for their members’ tithes, donations, and gifts to be tax-deductible?
Again, no, according to Owens and to IRS regulations readily accessible to the public.
But even if a church chooses not to be recognized as a 501(c)(3) tax-exempt organization, Owens said, provisions of the federal tax laws prohibiting “intervention in a political campaign” still apply to all churches. If the IRS finds that a church has violated this prohibition, the activities that constituted the violation are subject to an excise tax, according to the IRS.
“A church needs no ruling from the IRS to be exempt