is a church ? What is NOT a church
[7.8.3] 2.2.4 (03-30-1999)
Definition of a 'Church' --Administrative Guidance
[7.8.3] 2.2.1 (03-30-1999)
Relationship of IRC 170(b)(1)(A)(i) to IRC 501(c)(3)--Religious Purposes
Churches are a subset of 501(c)(3) organizations organized and operated for religious purposes. See, e.g., De La Salle Institute v. United States , 195 F.Supp. 891 (N.D. Cal. 1961); Chapman v. Commissioner , 43 T.C. 358, 363 (1967).
[7.8.3] 2.2.2 (03-30-1999)
Churches are not exempt from the substantive requirements for exemption under IRC 501(c)(3)--an organization's religious beliefs or practices cannot serve as an excuse.
Thus, a church's organizing document must comply with the organizational test. [EV's Articles of Incorporation?]
[7.8.3] 2.2.4 (03-30-1999)
Definition of a 'Church' --Administrative Guidance
The current regulations under IRC 170 do not define a 'church.'
An organization qualifies as a church only if its principal purpose or function is that of a church. See Rev. Rul. 56-262, 1956-1 C.B. 131.
Of course, to determine whether certain purposes or functions are those of a church, one must know what a church is.
The Service considers all the facts and circumstances in determining whether an organization is a church, including whether the organization has the following characteristics:
a distinct legal existence
The above list of 14 church characteristics (first published by the Service in 1978 as a news release, IR-1930) is not exclusive--any other facts and circumstances that may bear upon the organization's claim for church status must also be considered.
An organization need not have all of the characteristics (few churches do, and newly-created churches cannot be expected to); thus, no single characteristic is controlling.
Some of the characteristics may be given more weight than others in a given case.
[7.8.3] 2.2.5 (03-30-1999)
Definition of a 'Church' --Judicial Guidelines
Court opinions provide most of the guidance on the meaning of 'church.'
The courts have generally supported the principle of Rev. Rul. 56-262 that 'the tail cannot be permitted to wag the dog' (as the court put it in De La Salle Institute , 195 F.Supp. at 901).
[These following were found NOT to be churches]
- De La Salle Institute (corporation organized under the auspices of the Roman Catholic Church, whose members were the members of a religious order, and that operated (1) a novitiate that trained men for the order, (2) Catholic schools for youth, (3) homes for the members of the order, and (4) a winery and distillery, in addition to chapels at the schools and novitiate, was not a church)
Lack of a recognized creed or exclusive membership were deemed significant in Chapman v. Commissioner , 48 T.C. 358 (1967), which held that an organization of dentist missionaries formed to spread the Gospel and improve dental care in foreign countries was not a church, where the organization was not affiliated with any church, drew its members from various Christian denominations, and did not attempt to promote membership in any particular Christian denomination.
The court reasoned that Congress used the term 'church' in the sense of a denomination or sect rather than the generic or universal sense.
Judge Tannenwald's influential concurring opinion reasoned that the organization was not a church, due not to its failure to ascribe to a particular denomination of Christianity, but rather to its failure to bring people together as the principal means of accomplishing its religious purpose--the dentist missionaries operated largely on an individual basis, although they held some religious services.
Courts have frequently applied the 14 criteria in determining whether an organization is a church, the first being American Guidance Foundation, Inc. v. United States , 490 F. Supp. 304 (D.D.C. 1980), affirmed in unpublished opinion (D.C. Cir. 1981), which noted that while some of the 14 criteria are relatively minor, others (e.g., the existence of an established congregation served by an organized ministry, the provision of regular religious services and religious education for the young, and the dissemination of a doctrinal code) are of central importance.
The court reasoned that, at a minimum, a church includes a body of believers that assembles regularly to worship and that is reasonably available to the public in its conduct of worship, educational instruction, and promulgation of doctrine.
The court also noted that superficially responsive documentation for each of the 14 church characteristics is not sufficient to establish church status.
The court held that a 501(c)(3) religious organization composed of a few family members who attended worship services at a relative's apartment and that made no real effort to extend its membership beyond the family was not a church.
Universal Bible Church. Inc. v. Commissioner , T.C.M. 1986-170 (organization was not a church where it failed to establish a distinct religious history, a membership beyond the trustees (2-50 people attended services, held in the homes of the trustees), or religious instruction for children, and its primary means for promoting its beliefs was to be through radio, t.v. and other media)
First Church of In Theo v. Commissioner , T.C.M. 1989-16 (organization was not a church where its principal activity was publishing religious literature and it had no plans for membership (although it conducted some religious services), no formal creed (other than the Bible and a belief that God dwells in all people), no sacerdotal functions, no membership unassociated with other churches, no regular congregations or services, no established place of worship, no organized ministry for ministering to congregations, and no youth instruction)
Spiritual Outreach Society v. Commissioner , 927 F.2d 335 (8th Cir. 1991) (organization that held bimonthly outdoor gospel music events and retreats with people of different religions for purposes of meditation and study was not a church where it had no established congregation of members who claimed the organization as their church, no organization of ministers other than guest ministers from other churches, and no religious education of the young)
VIA v. Commissioner , T.C.M. 1994-349 (organization formed to promote the 'wellness' and spiritual growth of its members through use of the latest discoveries in exercise, nutrition, and stress management and that held meetings at the members' houses (which involved group meditation, exchange of information on wellness, monitoring of the members' physical fitness, and designing of individual wellness programs), trained mentors to conduct such activities, published a newsletter sold at grocery stores, sold a nutritional food supplement, and planned to broadcast a wellness news program was held not a church--the court reasoned that the organization did not have any of the 14 church characteristics other than a distinct legal existence and literature of its own, and that its meetings, even if viewed as a form of worship, were incidental to its other activities)
The bottom line is, EV would not stand up as a church if properly challenged, and that being the case, would be classified probably as a Private Foundation (Tax Reform Act of 1969) and liable for all sorts of embarrassing restrictions and disclosures.
EV's relationship with all its 'approximately 50 independent Elan Vitals in different countries around the world' (sic; EV website Press Kit and EV's websites).
You may have noted that its Affiliation Code was listed as
'3 - Independent - This code is used if the organization is an independent organization or an independent auxiliary (i.e., not affiliated with a National, Regional, or Geographic grouping of organizations)'
(Elan Vital, incorporated in 1971 in the US, is a charitable organization that sponsors events and conferences throughout the US at which Maharaji is invited to speak.
Elan Vital cooperates with organizations which have similar objectives in more than 45 countries around the world.
A number of organizations around the world with objectives similar to Elan Vital are developing their own websites. We will provide links to these sites as they go online.
Elan Vital UK
Time to review their status?
.. Well I'm sure there are all kinds of possibilities for 'creative accounting' given their admitted international relationships.
they need to be a Church !
Extract from 26 USC 6033
(a) Organizations required to file
(1) In general
Except as provided in paragraph (2), every organization exempt`from taxation under section 501(a) shall file an annual return, stating specifically the items of gross income, receipts, and disbursements, and such other information for the purpose of carrying out the internal revenue laws as the Secretary may by forms or regulations prescribe, and shall keep such records, render under oath such statements, make such other returns, and comply with such rules and regulations as the Secretary may from time to time prescribe; except that, in the discretion of the Secretary, any organization described in section 401(a) may be relieved from stating in its return any information which is reported in returns filed by the employer which established such organization.
(2) Exceptions from filing
(A) Mandatory exceptions
Paragraph (1) shall not apply to -
(i) churches, their integrated auxiliaries, and conventions or associations of churches,
(ii) any organization (other than a private foundation, as defined in section 509(a)) described in subparagraph (C), the gross receipts of which in each taxable year are normally not more than $5,000, or
(iii) the exclusively religious activities of any religious order.
(b) Certain organizations described in section 501(c)(3)
Every organization described in section 501(c)(3) which is subject to the requirements of subsection (a) shall furnish annually information, at such time and in such manner as the Secretary may by forms or regulations prescribe, setting forth -
(1) its gross income for the year,
The list goes on. The point is, had they not declared themselves to be a church, this information (with certain exceptions) would be available to any individual requesting it. Which would be useful for any person considering making charitable donations, especially large ones, wishing to be sure the money is properly spent.
Organizations Technical Guidelines
Any religious organization, including a church, must satisfy the statutory requirements to be exempt under IRC 501(c)(3). As explained by the court in Christian Echos National Ministry. Inc. v. United States , 470 F.2d 849 (10th Cir. 1972), cert . den ., 414 U.S. 864 (1973)
Exemption from state or local taxation is neither conclusive nor relevant to the determination whether an organization is operated exclusively for religious purposes under federal tax law. Universal Life Church v. U.S. , 721 USTC 9467 (E.D. Cal. 1972).
[7.8.2] 3.4.2 (02-23-1999)
Public v. Private Purposes
Reg. 1.501(c)(3)-1(d)(l)(ii) provide that to meet the operational test, an organization must be engaged in activities furthering 'public' purposes rather than private interests. It must not be operated for the benefit of designated individuals or the persons who created it.
[Could it be argued that helping to fulfil M's. 'purpose' in spreading K. to the world is a 'private' rather than 'public' interest? Hmm.]
Numerous court cases have held that, in situations similar to that described in Rev. Rul. 81-94, an organization that serves the private interests of a designated individual rather than a public interest does not qualify for exemption under IRC 501(c)(3). See , for example, Basic Bible Church v. Commissioner , 74 T.C. 846 (1980); Church of the Transfiguring Spirit, Inc. v. Commissioner , 76 T.C. 1 (1981); People of God Community v. Commissioner , 75 T.C. 127 (1980); The Southern Church of Universal Brotherhood Assembled, Inc. v. Commissioner , 74 T.C. 1223 (1980); Bubbling Well Church of Universal Love v. Commissioner , 74 T.C. 531 (1980); and Unitary Mission Church of Long Island v. Commissioner , 74 T.C. 507 (1980); aff'd , 647 F. 2d 163 (2d Cir. 1981).
[Next: did EV include ashrams as part of its 'charitable status'?]
In Beth-El Ministries. Inc. v. United States , 79-2 USTC S9412, an organization whose members donated all their possessions and, if employed outside the organization, their salaries, to the organization, and which provided its members benefits in the form of food, clothing, shelter, medical care, recreational facilities, and educational services, was held not to be exempt as a religious organization. The court concluded that private benefits inured to the organization's members because the organization paid their living expenses.
If anyone has any questions or concerns so far, here is where to send them:
EXEMPT ORGANIZATION INFORMATION AVAILABLE THROUGH THE STATISTICS OF INCOME(SOI) 'TAX STATS' INTERNET WEB SITE
This document provides information to organizations and individuals who desire information on exempt organizations from the Internal Revenue Service's Business Master File (BMF) through the SOI 'Tax Stats' Internet Web Site. If you have any questions about the tax exempt organizations, the data fields, or the contents of the file, please contact Betty Crawford, Fields Systems Branch, OP:E:FS, at (202) 622-8001.