Last month a United States District Court for the Northern District of Georgia (Atlanta Division) declared a state sales exemption for the Holy Bible unconstitutional. See, Budlong v. Commissioner of Georgia State Revenue (February 6, 2006). One can view this case as raising two clashing constitutional principles. On the one hand, the power to tax is the power to destroy. Consequently, one might argue that taxing sales of the Holy Bible provides the government with the potential to inhibit the free exercise of religious belief. On the other hand…
| Join our very own Jack Siegel in San Fransico on June 7 through 9, 2006 at the annual CAPLAW National Training Conference. Jack spoke at this conference last June when it was held in Chicago. He was quite impressed with the quality of the sessions. All nonprofits certainly would benefit by sending representatives, but the conference will have special appeal to social services agencies. Sessions will cover employment law, governance, audit committees, property tax exemption, issues specifically relating to Head Start Programs and community action agencies, politics and lobbying, federal tax issues, and a host of other topics. The instructors are top notch, including several from highly respected professional service organizations. Jack will be leading three sessions. Two will focus on fiscal matters. The first is specifically directed to the numbers-phoebic mission person, with an introduction to how to read nonprofit financial statements. This tried and tested presentation steers entirely clear of debits and credits, but it gets the job done. Jack will take a close look at how end users can get a lot of useful information out of financial statements. In the second session, Jack will focus on issues that confront those who are responsible for preparing financial statements and maintaining accounting systems. This session will cover much of the same ground that Jack covered in June 2005, but CAPLAW has given Jack much more time to develop his major themes. In the third session, Jack will explore record retention policies for nonprofits. There is great demand for this topic. Jack has spent a fair amount of time exploring this area in an effort to develop a model record retention policy for nonprofits. That policy still does not exist, but Jack has gained many insights into record retention and will pass those along. He will also focus on e-mail policies. It should be a lively session. All work and no play makes our Jack a very dull boy. San Francisco certainly will offer both Jack and you many diversions. There are great museums, galleries, restaurants, and great scenery. BART makes much of the Bay Area very accessible. Golden Gate Park will bring back the Summer of Love. Be sure to visit the famous tea house. Bring the family, stay a few days extra, and take a scenic drive up the California coast line. For a brochure and registration information, click here. |
granting an exemption for sales of the Holy Bible ties a taxing exemption to an evaluation of content by the state. In other words, the state is showing a preference for certain content over other content. That raises freedom of speech concerns. Somewhat surprisingly, the court never focused on the first policy concern, probably because the sales tax statute, sans the exemption for the Holy Bible, would be applied on a neutral basis, affecting all content, including religious content, equally.
The case is interesting as a constitutional matter, but it holds a larger lesson for all nonprofits. Exemption from sales taxes is a matter of legislative grace. Before assuming sales by a Section 501(c)(3) organization or sales of particular types of goods and services are exempt from state sales tax, the organization must bring itself within an exemption from the general rule that retail sales are subject to tax.
Internal Revenue Service - Circular 230 Disclosure: As provided for in
Treasury regulations, any advice (but none is intended) relating to
federal taxes that is contained in this communication is not intended
or written to be used, and cannot be used, for the purpose of (1)
avoiding penalties under the Internal Revenue Code or (2) promoting,
marketing or recommending to another party any plan or arrangement
addressed herein.
If you liked this post, please visit http://www.charitygovernance.com
for a description of our Guide/Tutorial for non-profit directors and
officers entitled “Avoiding Trouble While Doing Good: A Guide for the
Non-Profit Director and Officer.” Copyright 2006, Auto Didactix LLC. All Rights Reserved. You may not
copy any portion of this post to a computer "clipboard" for re-posting
anywhere or e-mailing, or otherwise reproduce this post. If you want
others to review this post, you may provide them with a link to this
web blog. Any use of the material or ideas in this post by reporters or
other publishers shall make reference to Jack Siegel, author of
"Avoiding Trouble While Doing Good, A Guide for the Non-Profit Director
and Officer" and this web blog. For additional information call 773-325-2124
THE
FOREGOING IS NOT AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. IF LEGAL
ADVICE IS REQUIRED, THE NON-PROFIT OR OTHER PARTY IN QUESTION SHOULD
SEEK THE ADVICE OF QUALIFIED LEGAL COUNSEL.
