Troop incorporates as non-profit, then billed $3K in personal property taxes.

[RememberSchiff]

Arlington, VA:

Local Methodist Church stopped sponsoring its BSA troop, however the troop can still use church facilities. The troop decided to incorporate as a nonprofit.

Unlike locally exempt churches, museums, the YMCA and similar religious groups, the troop didn’t realize was that getting 501(c)(3) status and federal tax-exempt status did not protect it from state tax code or Arlington’s personal property tax - $3000 personal property tax bill on its vans!

A member of the troop , Griffin Crouch ( I believe he is a recent Eagle Scout?) brought to matter to the Arlington County Board

“We have discussed the matter with our Commissioner of Revenue (COR), and although we are prohibited under state law from discussing the details of a particular taxpayer’s liability, the COR has confirmed that as a general matter, personal property belonging to a federally income-tax-exempt 501(c)(3) entity is subject to the personal property tax in Arlington with a few limited exceptions,” Arlington County spokeswoman Jessica Baxter told ARLnow.

“It seems wrong a scout troop has to pay that because it’s being sponsored by a non-religious nonprofit rather than a church,” Crouch said. “We still help the church and it considers us a part of its social justice ministries.”

Board Chair Katie Cristol praised Crouch for demonstrating “the best of the values of scouting: community organization, leadership and critical thinking and analysis.”

...

 

“I think you have done a great job of summarizing how it’s been a complicated series of events to get the troop here,” she said. “I wonder if there may be some opportunities for us to figure out your incorporation status, and if there are ways we can help in that regard.”

Interesting article

https://www.arlnow.com/2022/09/22/how-a-local-scouting-troop-got-saddled-with-3k-in-personal-property-taxes/

 

Edited September 22, 2022 by RememberSchiff

[RememberSchiff]

Update 1/11/23 from Virginia legislature:

Delegate of the 47th District of the Commonwealth of Virginia, Patrick Hope (D-Arlington) has introduced House Joint Resolution 531:

Constitutional amendment (first reference); personal property tax; exemption. Provides that property owned by a chartered organization and used solely for the purpose of supporting one or more scouting units holding a charter issued by the Boy Scouts of America or Girl Scouts of the United States of America shall be exempt from state and local taxation.

Those organizations would join other nonprofits that also enjoy this status, including museums, churches, the YMCA and similar religious groups.

“I know many Scout troops rely on vehicles for camping trips and backpacking adventures across the state and the country,” Hope said. “Many troops, however, cannot afford other means of transportation to these excursions and owning your own van(s) is an economical way to afford these life-changing experiences.”

Sources:

Full Resolution in pdf

https://www.arlnow.com/2023/01/27/del-hope-files-bill-to-exempt-scouting-troops-from-personal-property-taxes/

[Eagle1993]

I don't understand.  Why would religious institutions be exempt from paying personal property tax but other non profits are not exempt?  Even the fix doesn't sound great.  What about 4H or First Robotics teams?  

[scoutldr]

36 minutes ago, Eagle1993 said:

I don't understand.  Why would religious institutions be exempt from paying personal property tax but other non profits are not exempt?  Even the fix doesn't sound great.  What about 4H or First Robotics teams?  

Separation of church and state.

[jcousino]

Church normally do not pay taxes on the worship center and support building and the parsonage. Other church own property can be subject to taxes. 

 

[Eagle1993]

32 minutes ago, scoutldr said:

Separation of church and state.

It seems odd they only allow this for a religious purpose.  It seems like that could be targeted by lawsuits ... like the state is establishing a religion by pushing non-religious institutions with taxes they don't apply to religious ones.  Plus, it isn't just religious institutions ... it is that + museums.  In my state, yes, churches don't pay but most other non profit organizations don't have to pay property tax.  They don't just separate out museums + churches.

The fix is even more odd.  Why not other youth organizations?  Why not other non-profit organizations?

I'm glad I don't run a non-profit in Virginia.  Having to pay property tax when you run a homeless shelter or food pantry seems wrong.

[awanatech]

6 hours ago, Eagle1993 said:

It seems odd they only allow this for a religious purpose.  It seems like that could be targeted by lawsuits ... like the state is establishing a religion by pushing non-religious institutions with taxes they don't apply to religious ones.  Plus, it isn't just religious institutions ... it is that + museums.  In my state, yes, churches don't pay but most other non profit organizations don't have to pay property tax.  They don't just separate out museums + churches.

The fix is even more odd.  Why not other youth organizations?  Why not other non-profit organizations?

I'm glad I don't run a non-profit in Virginia.  Having to pay property tax when you run a homeless shelter or food pantry seems wrong.

The state giving a tax break to religious institutions is far from the state "establishing a religion". There are many different religions and even more denominations broken down within those religions. They can each have very different, sometimes opposing, views on matters of religion. How would be the state be establishing a religion by recognizing so many different ideologies? If the state were to establish a religion, it would give preferential treatment to that particular religion over the over non-established religions. It would not be treating them all the same, regardless of beliefs. Recognizing a religion is very different than establishing one.

[InquisitiveScouter]

On 1/27/2023 at 11:29 PM, awanatech said:

The state giving a tax break to religious institutions is far from the state "establishing a religion". There are many different religions and even more denominations broken down within those religions. They can each have very different, sometimes opposing, views on matters of religion. How would be the state be establishing a religion by recognizing so many different ideologies? If the state were to establish a religion, it would give preferential treatment to that particular religion over the over non-established religions. It would not be treating them all the same, regardless of beliefs. Recognizing a religion is very different than establishing one.

Define religion... you could make a statement that Boy Scouts is your religion, and that you worship Lord B-P.  If the state gives tax breaks to a "religion" but not to other non-profits, then that is a state "establishing a religion"...

 

[Tired_Eagle_Feathers]

Traditionally and historically, churches have been exempt from certain kinds of taxes.