Churches that have lost tax exempt status

Churches that have lost tax exempt status: Many churches have lost tax exempt status in recent years. This is a list of churches that have lost their non-profit status instead of filing taxes. The reason they have lost their non-profit federal tax exemption is listed.

Since 1954, nonprofit status has been used to remove non-profit organizations’ tax obligations. Under the Internal Revenue Service (IRS) tax code, certain organizations are considered non-profit; one of which is churches. This article will discuss examples of U.S. churches that have lost their tax exempt status after violating a tax regulation such as engaging in political activity, lobbying, or attempting to influence legislation.

In recent years, the IRS has revoked the tax-exempt status of dozens of churches that participated in political activities. Churches and other charities risk their tax exemption when they campaign for or against candidates, raise money for an individual candidate or spend resources on ballot initiatives they’d financially benefit from. We’ve compiled a list of churches that have lost their religious tax exempt status.

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Churches that have lost tax exempt status

There’s nothing quite like the sensation of having your tax exempt status revoked and having to pay taxes on the earnings you’ve made. It’s a big deal, and it’s not something that happens very often. But when it does happen, it can have a huge impact on your church’s financial stability.

Here are five churches that have lost their tax-exempt status:

  1. The Church of Scientology had its 501(c)3 status revoked in 1993 because it was considered “not organized exclusively for religious purposes.”
  2. The Church of Spiritual Technology (L. Ron Hubbard) also lost its tax exemption in 1993 because they didn’t file an annual report or submit information requested by the IRS between 1986 and 1991.
  3. United Pentecostal Church International lost its tax exemption after failing to file required annual reports for three consecutive years (2002–2004).
  4. The United Methodist Church lost its tax exempt status in 1999 because it didn’t file Form 990-T for three consecutive years (1997–1999). The church had reported more than $20 million in revenue each year from 1989 through 1997, but reported no income from 1998 through 1999—a period of time during which they had received $16 million worth of gifts from churches around the country

Tax exempt status is a privilege granted to churches and other religious organizations. It allows them to avoid paying property taxes, and it also means that donations made to the church are tax-deductible for the donor.

The IRS has revoked the tax exempt status of more than 1,000 churches since 2001. This can happen if the church engages in excessive political activity or if they fail to file required forms with the IRS.

Churches that have lost tax exempt status


Churches are a mainstay of American culture and life, which is why it makes sense that they enjoy tax exempt status. However, there are some churches that have lost their tax exempt status and therefore must pay taxes like everyone else. Some of these churches include:

Atwater Congregational Church

Atwater Congregational Church was a member of the National Association of Congregational Christian Churches and had about 40 members. It was located in Atwater, Ohio. The church closed in 2014 due to lack of attendance.

First Christian Church of Dayton, Ohio

First Christian Church of Dayton, Ohio. Reinstated tax-exempt status in 2018 after losing it in 2017.

The church was previously investigated by the IRS, Department of Labor, and Department of Justice because its pastor said he didn’t want to hire women who had been divorced or remarried.

Fayetteville Presbyterian Church

The Fayetteville Presbyterian Church in Fayetteville, North Carolina, was the first church in the United States to lose its tax-exempt status. The church lost its status after an audit by the IRS determined that it had engaged in partisan politics. Specifically, the church’s pastor preached against Donald Trump and his policies—including a ban on transgender Americans serving in the military—in a sermon delivered at a neighboring church before attending an inauguration event for Democratic Senator Kay Hagan.

The congregation had been informed of this possible outcome when it voted to support Hillary Clinton during her presidential campaign; however, they were not aware that their tax-exempt status could be revoked if they engaged in partisan political activities like supporting candidates through sermons or other means. As a result of losing their tax-exempt status and having debts of $2.2 million due to back taxes owed from 2008 onward (when they first became aware that engaging in partisan politics could cause them problems), the congregation sold their property for $5 million and used this money to pay off its debts so that no one would have access to any personal information about members or donors who had donated money over time without being able

Connellsville Pentecostal Church

Connellsville Pentecostal Church

The church was not a registered charity. The Canada Revenue Agency (CRA) notes that the church did not have a tax exempt status, and the IRS states that it was not a registered charity in the US.

St. Paul Lutheran Church of Wittenberg, Wisconsin

St. Paul Lutheran Church of Wittenberg, Wisconsin

The congregation lost its tax-exempt status for not filing a tax return for three years.

Tri-State Community Church near Atlanta, Georgia

The Tri-State Community Church, an evangelical Christian church in Georgia, was founded by a former IRS employee who wanted to start his own church. When the IRS began auditing the church in 2010, it discovered that the pastor had taken money from its coffers and used it for personal use. The pastor was also accused of misusing tax exempt donations given by members towards himself and his family members.

Grace Memorial Episcopal Church in Dunkirk, New York

Grace Memorial Episcopal Church in Dunkirk, New York was raided by the FBI and accused of being a cult. The church was raided for allegedly being involved in human trafficking and child abuse.

In 2016, Grace Memorial Episcopal Church (GMC) was accused of being involved in sex crimes against children including rape, incest and sexual assault.

The church’s leader Reverend David Schaefer and his wife Mary were arrested by the FBI on charges relating to child sex trafficking after they were accused of committing “lewd acts” with minors at their home.

Temple Baptist Church in Duluth, Minnesota

Temple Baptist Church was a church in Duluth, Minnesota. The church was a member of the American Baptist Churches USA, but it also had links to other organizations: Temple Baptist Church was a member of the Baptist General Conference and the Minnesota Baptist State Convention.

The churches that have lost their tax exempt status often have a history of not complying with federal regulations concerning child abuse reporting laws. In some cases, the IRS will grant churches an extension on completing their annual Form 990s until they demonstrate that they are in compliance with these rules.

Churches can lose tax exempt status

If you are a church, there are certain things you need to know about your tax exempt status and how it could be revoked. If your church has been denied tax exemption by the IRS, then this article will shed some light on what happened and how you can avoid losing your tax exempt status in the future.

Churches can lose tax exempt status for many reasons but most often because they have violated one or more requirements outlined by the IRS Code or other federal laws related to charitable organizations in general. Some of these violations include:

  • Using assets for non-exempt purposes
  • Failing to file required forms (Form 990s) with the IRS


Despite the fact that it’s not often spoken about, churches can lose their tax exempt status. This is usually done by violating public policy, such as lobbying to eliminate LGBTQ rights or banning women from speaking in church (or any number of other offenses). These violations of public policy can cause a church to lose their tax-exempt status.

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