|TAX QUESTION IS ANSWERED FOR CHURCH|
QUESTION IS ANSWERED FOR CHURCH
Can a non profit, tax exempt church operate a restaurant? That is a question to which leaders of the non-profit taxexempt Vine Christian Community Church have, with the help of some friendly lawyers, found an answer
Under section 5 10-C-3 of the Internal Revenue Code, the section by which most churches claim, tax-exempt status, if a church has "unrelated business income, "such as that which might came from operation of a restaurant, it must pay tax on that income.
The Vine Church, however, has skated that problem by establishing a separate corporate entity, T.H.E. Community Apostolic Order, to operate the restaurants. That corporation is also non-profit and tax-exempt, but bases its exemption on section 501 -D of the Internal Revenue Code.
Under that section, a religious organization or "Apostolic Order" which has a common treasury, as does the Vine group, may engage in business "for the common good of members."
The income of the corporation, however, is not entirely tax-exempt Each member of the group must
report his proportionate share of the total corporate income as part of the gross income on his individual
income tax return