Saturday, February 10, 2018

Rationales for Nonprofit Tax Exemption

 
In this article, the historical, tax base definition, sovereignty, and subsidiary rationales for why nonprofits are exempt from taxation are examined. The historical rationale explains that one reason nonprofits do not have to pay certain taxes is because its tradition. Dating all the way back to ancient Babylon churches were exempt from paying property taxes. The tax base definition rationale explains that because nonprofits use their income for charitable purposes they must be exempt from taxation. This rationale explains that the tax base does not include religious, educational, and charitable activities meaning that nonprofits should not be taxed. The subsidy rationale explains that because nonprofits have a charitable purpose they lessen the burden of the government. This burden reduction qualifies nonprofits to receive a tax exemption. To learn more about the rationales for why nonprofits are tax exempt, click here: https://www.wagenmakerlaw.com/blog/rationales-nonprofit-tax-exemption
 
 
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http://lawprofessors.typepad.com/nonprofit/2018/02/rationales-for-nonprofit-tax-exemption.html

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