Expert: Ed Buckner - 9/3/2007

Question
Are megachurches exempt from paying taxes?  Do pastors not have to take a vow of poverty?  And how is it that someone like Joel Osteen can run a church, take people's money by telling them there's an invisible man in the sky and not be charged with fraud.

Bruce Clark

Answer
Mr. Clark,

I am in wholehearted agreement with what I take to be the implications of your question (and I apologize for not answering it promptly--I was out of town and neglected to put my All Experts status "on vacation").

My understanding--though I am an outsider when it comes to churches and religions--is that most pastors probably do not take any literal "vow of poverty" but are expected to be modest to conservative in their lifestyles by their churches. Many--most?--obviously do not meet any such expectations; some--including, IMNSHO, Joel Osteen, flagrantly violate any such standards.

Freedom of religion and the First Amendment mean that governments cannot determine what constitutes religious truth, so "invisible man in the sky" doctrines, though apparently fraud to people like you (and me) are in fact protected in the name of religious liberty.

Because I believe religious liberty is important and therefore want to keep government out of the business of regulating religious beliefs, I would not personally approve of declaring such ideas fraudulent--but I do strongly believe that religious organizations should have to account for their income and expenses to exactly the same extent as any other non-profit organization (they are now wholly exempt from any such accountability under IRS regulations). In some locales, churches do have to pay property taxes, while in many others state or local laws exempt them. In my not so humble opinion, any organization--including churches, temples, and mosques--that wants and gets fire and police protection, paved roads in front of their buildings, etc., *should* pay property taxes.

Thanks for your excellent questions.

Regards,

Ed B.