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Nonprofit Law/Non profit service fees

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QUESTION: I am the founding pastor of a church that was open for 20 years.  The church is now closing. We have a mortgage on the building. I want to carry on a wedding/funeral/hospital visitation/crisis prayer and support ministry from the building.  Must we legally close the church down and start a new ministry or can I run the new ministry under the auspice of the existing church.  Also the weddings and funerals will have facility rental fees and officiating fees associated with them while the visitation and crisis services will be free.  Please advise if the new ministry will now been a taxable entity or a non profit entity.  My income will come directly from the service fees.  Thanks!

ANSWER: You will not be having a church in the future because the IRS classification for church is only for an organization that has a regular congregation of non-family members which has regular worship services. The question, then is whether your operation would be qualified as another type of 501(c)(3) organization, one that has exclusively charitable, religious or educational activities. From what you wrote, it is possible that you could have such a qualification, as long as your main activities of the wedding/funeral/hospital visitation/crisis prayer and support activities can be distinguished from regular for-profit business, such as regular for-profit wedding services. From what you wrote I would not be able to give you my opinion and that would depend on how much religious content and religious use in solicitations for your business, among other factors. I have in my profile in my forum at http://bit.ly/NonprofitLaw the free service that I offer is only for general questions directly related to IRS exempt purpose issues of 501(c)(3) organizations.

Your issues are beyond that and require specific analysis and I would need to spend a substantial amount of time.  If you want to hire me, send me an email directly to my email address below and I will quote you my fees.

Harvey Mechanic
Attorney at Law
Harvey108@hotmail.com

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.

---------- FOLLOW-UP ----------

QUESTION: You wrote, "my opinion and that would depend on how much religious content and religious use in solicitations for your business, among other factors."
My content and use of religious content would be actually upfront, abundant and the stated purpose for all the services that I would offer...ie. the the mission of the ministry would be to bring Jesus Christ into the important stages of life like marriage and death and health/crisis situations with the purpose of receiving spiritual comfort, guidance and blessing in each situation...we will have a statement of faith and invitation to believe the Gospel and an offer for follow-up Bible studies for those who would like to know more about following Christ in their lives...the Bible study would also be held at the church building.

Answer
Ok, that is favorable. The IRS looks at other factors also, for example, how much the business will depend upon donations and public control of your board to insure that you would not be receiving personally more than reasonable compensation for your services rendered.

Harvey Mechanic
Attorney at Law
Harvey108@hotmail.com

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.

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Harvey Mechanic

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I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at Harvey108@hotmail.com I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "site:allexperts.com/q/nonprofit" without the quotes and then add your search terms before hitting enter.

Experience

I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.

Education/Credentials

B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.


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